Plus Therapeutics, Inc. (PSTV) Q1 2021 Earnings Report, Transcript and Summary

Good afternoon, ladies and gentlemen. Welcome to the Plus Therapeutics First Quarter 2021 Results Call. At this time, all participants have been placed in a listen-only mode, and the floor will be opened for your questions following the presentation. [Operator Instructions] Before we begin, we would like to advise you that over the course of the call and question-and-answer session, forward-looking statements will be made regarding events, trends, business prospects and financial performance, which may affect Plus Therapeutics' future operating results and financial position. All such statements are subject to risk and uncertainties, including the risk and uncertainties described under the Risk Factors section included in Plus Therapeutics' annual reports on Form 10-K and quarterly reports on Form 10-Q filed with the Securities and Exchange Commission from time to time. Plus Therapeutics advises you to review these risk factors in considering such statements. Plus Therapeutics assumes no responsibility to update or revise any forward-looking statements to reflect events, trends or circumstances after the date they are made. It is now my pleasure to turn the floor over to Dr. Marc Hedrick, Plus Therapeutics' President and Chief Executive Officer. Sir, you may begin.

Good afternoon, ladies and gentlemen. Welcome to the Plus Thera[indiscernible]peutics Fourth Quarter and Full year 2020 Results Call. At this time, all participants have been placed in a listen-only mode, and the floor will be opened for your questions following the presentation. [Operator Instructions] Before we begin, we would like to advise you that over the course of the call and question-and-answer session, forward-looking statements will be made regarding events, trends, business prospects and financial performance, which may affect Plus Therapeutics' future operating results and financial position. All such statements are subject to risk and uncertainties, including the risk and uncertainties described under the Risk Factors section included in Plus Therapeutics' annual reports on Form 10-K and quarterly reports on Form 10-Q filed with the Securities and Exchange Commission from time to time. Plus Therapeutics advises you to review these risk factors in considering such statements. Plus Therapeutics assumes no responsibility to update or revise any forward-looking statements to reflect events, trends or circumstances after the date they are made. It is now my pleasure to turn the floor over to Dr. Marc Hedrick, Plus Therapeutics' President and Chief Executive Officer. Sir, you may begin.

Great. Thank you, Catherine. Good afternoon, everyone and thank you for taking the time to join us today as we provide an overview of recent business highlights and discuss our 2021 first quarter results. Joining me on the call today is Mr. Andrew Sims, our Chief Financial Officer. Before Andrew provides a summary of our financial performance, I would like to provide an update on the company's business activities since our last earnings call. For those of you new to the company Plus develops complex, innovative therapeutics for rare and difficult to treat cancers such as cancers of the central nervous system. Our aspiration from a drug development perspective is to leverage our expertise in drug formulation, nanoparticles drug design, drug manufacturing and scale up and expertise and novel delivery technologies to provide better tumor targeting and killing a greater safety profile and ultimately better clinical outcomes. Toward that goal, in 2020 we broadened our expertise and technology platform to include the use of radionuclides in our drug formulations. Our lead drug is RNL, Rhenium Nanoliposomes, which is a proprietary liposomal encapsulated radium nuclei. The active agent is the radium 186 isotope, which is a dual energy inliter with recent blood cancer killing beta particles and gamma particles. which are useful for imaging. Our initial indication for RNL is recurring glioblastoma which affects approximately 12,000 patients in US and about the same number of patients in the EU. It is the most common and lethal form of brain cancer and the treatment of this devastating disease remain a significant medical challenge. Published studies indicate that external beam radiation provides the best incremental improvement in survival of all therapies currently used for glioblastoma and it remains an essential component of multimodal therapy for both glioblastoma and in fact many other cancers. In theory though, glioblastoma and indeed any tumor can be fundamentally controlled with a sufficient dose of radiation can be delivered to that tumor. With RNL it may be possible to deliver radiation dose only to the tumor that is perhaps 20 times higher than can be given with external beam radiation therapy and despite the super high doses of radiation delivered by RNL and precisely because of its inherent tumor targeting capability, unwanted radiation exposure to nearby healthy tissue is actually reduced. This compares favorably to the most commonly used chemotherapy as well as external beam radiation which is associated with significant side effects that occur due to their deleterious effects on normal tissues. Pre clinically in animals RNL has shown the ability to deliver almost 2000 gray, substantially prolonging survival and ablating brain tumors, since the cancer cells cannot be observed in the microscope. So RNL product is currently under evaluation in the US respect trial which is a dual phase 1, II multicenter sequential cohort open label volume and dose escalation study of the safety, tolerability and distribution of 186 RNL administered by convection enhance delivery to patients with recurrent or progressive malignant glioma after standard surgical radiation and/or chemotherapy treatment. The study uses a modified 3+3 dose escalation scheme followed by an expansion [indiscernible] tolerated dose to determine efficacy. In addition the trial is funded to a significant degree by the US National Cancer Institute. And in short the trial is progressing nicely. In November 2020 we provided an interim analysis from the first 15 patients enrolled in respect specifically going fifth cohort and can be found on our website. In this interim look at [indiscernible] RNL can successfully deliver approximately 15 times the absorbed dose of radiation that can be administered by standard external beam radiation therapy without significant toxicity. RNL was well tolerated with no dose limiting toxicity observed despite markedly higher absorb dozens of radiation compared to EBRT. Most recently in March of this year and in a Europe corporate presentation it can also be found on our website. We provided an interim update through Cohort Six. In summary we found that it's feasible to deliver 8.8 CCs of RNL loaded with 22 mCi of radiation, safely without treatment related serious adverse events. In fact most adverse events were causally unrelated to RNL except scalp discomfort considered related to the surgical procedure itself but not the drug. High absorbed doses were delivered to the brain nearly 600 gray [ph] but only with very limited systemic radiation outside the brain. In fact approximately 3,000 full difference between radiation to the brain versus the body is the absence of systemic effects of the radiation. There are two long-term survivors greater than 30 months and in terms of overall survival, median and mean survival duration in subjects with tumor coverage greater than 75% was at the time 8.3 months and 12.9 months respectively with six patients still alive. Median survival duration with tumor coverage less than 60% which was largely the failure patients was 4.9 months with one patient still alive. Rather than escalate the Cohort Seven after Cohort Seven, DMS the Data Monitoring Safety Board elected to treat an additional three patients at the Cohort Six dosing volume but increase the convection rate to 20 microliters per minute. Based on the physics of convection the presumption is that enhanced RNL distribution in the brain will be observed and therefore better coverage of the residual nonenhancing tumor cells achieved and in theory ultimately better patient outcomes. Our experience thus far two to three planned additional patients at 20 mCi per minute have been successfully treated with others in screening. Thereafter the SMB will evaluate the data and discuss and make recommendation. Potential next steps assuming no emergent dose from the intoxicates are observed include but not limited to escalating the dose in Cohort Seven, enrolling additional patients of the current levels with further changes in the delivery parameters or simply moving directly to the Phase 2 expansion cohort at the recommended Phase 2 dose. As an aside and running in parallel to the phase 1 and outside the direct clinical objectives of the trial also being developed in conjunction with academic collaborators is a mathematical model to better predict the spatial and temporal distribution of RNL delivered by convection. Data collected by the Phase 1 by imaging when interpreted and analyzed will upgrade and mechanism-based model of delivery and hopefully facilitate the increasingly more accurate delivery of RNL in the Phase 2 expansion component of the trial and therefore maximize the clinical outcomes. Regarding additional clinical development programs for RNL, a priority for us in 2021 as we've explained previously has been to begin development clinically with RNL in additional indications. To that endm we submitted two RNL pre-IND meeting briefing packages to the FDA, one for leptomeningeal metastases, the other for pediatric brain cancers including [indiscernible] We plan to conduct these pre IND meetings with the FDA for both indications in 2021, understanding the gaps that may exist in the preclinical data show those as needed and initiate those trials as soon as 2021. Both indications represent significant unmet medical needs and for example [indiscernible] about 110,000 patients in the US that has no clear standard of care and these patients die very rapidly despite the care is currently provided to them. As for pediatric brain cancers go much rare, they carry an equally poor prognosis. In the treatment approach we envision for pediatric brain cancer with near our approach in adults with glioblastoma using the direct targeting of the tumor convection enhanced delivery. Now regarding our manufacturing and supply chain development, which has been a key focus of our team of late. In the first quarter this year, we entered we entered into a Master Services Agreement with Piramal Pharma Solutions for the development, manufacturing supply of RNL immediate drug product drug. Product essentially they'll make the liposome force for the long-term. We anticipated that this will lead to clinical and commercial supply agreements for the drug product at the appropriate future stage of development and we're working on those and we're on track in terms of our development. Now this point, I'll turn the call over to Andrew for a brief review of our first quarter financial results, Andrew?

Thank you, Mark and good afternoon, everyone. Please refer to our press release issued earlier today for a summary of our financial results for the first quarter ended March 31, 2021. As of March 31, 2021, cash and cash equivalents were $14.4 million compared to $8.3 million as of December 31, 2020. Cash used in operations for the first quarter 2021 was approximately $3 million compared to $1.5 million in 2020. This difference is mainly due to timing differences on certain accounts payable and accrued expenses were paid in 2020 and in particular related to BARDA and professional fees. Revenues in the first quarter of 2021 as compared to approximately $118,000 in the same period last year. This decrease was due to the close out of the BARDA contract as previously disclosed. Research and development expenses were $1.1 million for the first quarter 2021 as compared to $0.9 million for 2020. The increase was primarily due to the additional RNL development costs. G&A expense was $1.12 million for the first quarter of 2021 as compared to $1.6 million for 2020. The decrease was primarily driven by a reduction in professional fees and recruiting expenses. Interest expense decreased in the first quarter of 2021 to approximately $247,000 from approximately $349,000 for the same period in 2020 reflecting the principal paydown in 2020. Net loss for the first quarter 2021 was $2.7 million as compared to a net loss of $1.1 million for the first quarter 2020. The net loss was consistent year on year when excluding the book gains on the warrants reported in the first quarter of 2020. This required booked transaction was eliminated in second quarter of 2020 when the series new warrants were amended. I'll now turn it back to you Marc.

So let me just summarize the forthcoming milestones and then we'll move to Q&A. So we intend to complete enrollment of the respect phase 1 study in the current glioblastoma as soon as we get through recommended phase 2 dose and then proceed with the trial. We plan to complete the pivotal trial planning with the FDA in parallel for RNL for recurring glioblastoma and then complete the key CMC activities as I mentioned before. We plan to complete the PID meetings as mentioned with the FDA, execute any IND enabling studies and move into clinical trials for our RNL indications leptomeningeal cancer in pediatric brain cancer. We also plan to continue develop and evaluate additional external and internal drug development candidates to RNL, DocePLUS and generic DoxoPLUS. And with that, those are prepared remarks. I'll turn it back over to you Catherine for Q&A.

[Operator instructions] And your first question is coming from Xiomi [ph].with Raymond

My first question is on the Respect study, so you mentioned that the FDI has decided to do a Cohort Six instead of going to Cohort Seven, so should we take that the doses used in court six was likely going to be the ones used in the next phase.

Shaun it could be. I presented what I through were the most likely outcomes in the script and so where we did not see dose limiting toxicity in the six cohort and typically that would be the reason to stop there and take that dose forward, but we're using the phase 1 not only get the recommended phase 2 dose but also to ensure that we go into the next trial with the appropriate delivery parameters and so I think we're maybe getting a little bit greedy here but we're delivering so much radiation that we can essentially how many times can you kill the same cancer cell. So part of what we're trying to do is to get that microscopic disease that's not enhancing on the scans and then and we do that effectively by increasing the flow rate which is increasing the pressure and pushing that the leading edge of the radiation into that microscopic disease. So it may be that this current dose of 22.3 mCi at about almost 19 [indiscernible] is what we take forward, but I think we'll just have to see, we could conceivably go to a cohort seven as well, but with this increase flow rate.

Got itm when you think you'll be able to get the next update of Cohort Six?

We actually the [indiscernible] in Texas at the end of February because all three of our sites in Texas actually into February and March light months. So things are covered in April and a lot of patients in screening as I mentioned we've got, we've treated two out of the three patients. So I think we remain maybe the next earnings call or if we make a decision prior to that we may just put that that news out at that time. So either before or likely the next earnings call.

Our next question is on the CMC side, so with [indiscernible] what should we expect the timeline on that? Then when do you expect to have the ready drug for the like for example pivotal study?

We're on track on from a timeline perspective. So we said we're want to have a drug ready for registration trial by around the end of 2021 and so we're on track to do that phase 2 drug supply which we contemplate expansion cohort with Phase 1. That we'll be ready for that as well, but that's a different supply chain if you will for that. So we're on track for both of those with the end of 2021 early 2022 is the timeline to have that drug available.

I see. My last question is on the next initial clinic study. So what are your thoughts on the designs about the study? Would you be looking to go at it with a traditional randomized -- randomized phase 3 or adapt phase 2, 3 with an adaptive design or would look participating for the other studies that are going on [indiscernible].

Yeah, so it's a looks to me – it's actually in terms of the phase 1,2, that trial is fairly locked in at 55 patients estimated 21 to get to the maximum tolerated dose in – upto another 34 patients at the recommended phase 2, so that's fairly well locked in and see me as likely to make many changes in terms of phase 3 and I think what I could say is we're likely to look at overall survival as a primary point. The number of patients is going to be based on what we see in the combination of the phase 1, phase 2 at the recommended phase 2 dose. I anticipate one uses synthetic control arm, in that will also be patients that are very likely that had no more than one occurrence in their -- patients as you know that those two were poorly and they don’t contact very we'll, so I don't see it's kind of randomizing 1 to 1 against [indiscernible]PRC as using potentially a synthetic control arm or more participating in an agile control.

I see, thanks for the additional color on that I have.

Thank you Sean.

Your next questions comes from the line of Edward Woo with Ascendiant Capital.

Thank you for taking my questions. I had a question more on the three sites that you have running I know you mentioned that those of the [indiscernible] and the delayed -- but is everything back on track? Any Covid issues and also have you thought about potentially expanding the sites?

Hey Ed, yeah it was really just maybe 4 or 5 -- we typically screen patients every week, so just patients can travel all of our sites till Texas. Texas got it really bad so we are back to normal we are screening multiple patients. We now, so things are going well with a lot of work to get the world out of after trial -- that's helping us, somewhere looking at some of the ways to do that and into your point about trial expansion, so yes, we absolutely are talking to additional sites probably not that thinking as much about the phase 1 as is an expansion cohort at the recommended phase 2 dose so that when net decisions made will be ready to get the sites on board and trained in the sites open label going to registration trials so when we get there used connection enhanced delivery there that we know through the high-volume sites are and will be going to the sites early on in that process to be we have launched them already.

Great and then you mentioned at phase 2 it's no indication that you have – to file an IND?

Edward, you are [indiscernible]

Sorry, can you hear me now?

Yeah, that maybe if Edward maybe can call back in a jump back in the be great, may be if somebody else in the queue, we could get him?

And there are no further questions at this time. I would like to turn the call back to you Dr. Hedrick for the additional and closing remarks.

Okay great thank you Captain, sorry about the -- just want to thank everyone who joined us on the call and also in participating in the call and also just like to say thank you to our employees, who work so hard and so dedicated to try to find a solution for the -- and other rare cancers and then also like to specifically thank the patients and the doctors and hospital staff, who we spend a lot of time with, and they a helpfully support and make a clinical trial -- So thanks again and please have a good evening.

Thank you, this concludes today's conference call [Operator Instructions]