BioAtla Q3 2023 Earnings Call Transcript

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November 7, 2023

There are 8 speakers on the call.

Operator

Good afternoon, ladies and gentlemen, and welcome to the BioAtla Third Quarter 2023 Earnings Call. At this time, all lines are in a listen only mode. Following the presentation, we will conduct a question and answer session. Please be advised that today's call is being recorded on Tuesday, November 7, 2023. I would now like to turn the conference over to Bruce Mackle of LifeSci Advisors.

Operator

Please go ahead.

Speaker 1

Thank you, operator, and good afternoon, everyone. With me today on the phone from BioAla are Doctor. Jay Short, Chairman, CEO and Co Founder and Rick Waldron, Chief Financial Officer. Following today's call, Doctor. Eric Sievers, Chief Medical Officer and Sherry Lydic, Chief Commercial Officer, will join Jay and Rick for a short Q and A.

Speaker 1

Earlier this afternoon, Bio Atlas released Results and a business update for the Q3 ended September 30, 2023. A copy of the press release and corporate presentation are available on the company's website. Before we begin, I'd like to remind everyone that statements made during this conference call will include forward looking statements, Including, but not limited to, statements regarding Bio Atlas' business plans and prospects and whether its Clinical trials will support registration, plans to form collaborations and other strategic partnerships for selected assets, Results, conduct, progress and timing of its research and development programs in clinical trials Expectations with respect to enrollment and dosing in its clinical trials, plans and expectations regarding future data updates, clinical trials, regulatory meetings and regulatory submissions, the potential regulatory approval path for its product candidates, Expectations about the deficiency of its cash and cash equivalents, plans to prioritize and focus development on selected sets and indications and expected R and D and G and A expenses. These statements are subject to various risks, Assumptions and uncertainties that can cause actual results to differ materially and are described in the filings made with the SEC, including the most recent quarterly report on Form 10 Q.

Speaker 1

You are cautioned not to place undue reliance on these forward looking Statements which speak only as of today, November 7, 2023, and Bio Atlas disclaims any obligation to update Such statements to reflect future information, events or circumstances except as required by law. With that, I'd like to turn the call over to Jay Short. Jay?

Speaker 2

Thank you, Bruce, and thanks to everyone for joining us for our Q3 2023 BioAtlas earnings call. BioAtlas is the inventor and leader in The development of novel therapies using a proprietary conditionally active biologics, CABs platform with improved selectivity for attacking tumor cells, while avoiding healthy cells, thereby addressing critical unmet needs in oncology to improve patients' lives. As we approach the end of 2023, we have obtained data to support several value inflection points across our CAB portfolio and continue to focus on further advancing the development of our prioritized CAB programs. We believe that forming 1 or more strategic collaboration with major pharmaceutical partners can accelerate development of selected assets and maximize their market opportunities. We also believe that our more focused and strategic approach better positions us to enhance value for shareholders.

Speaker 2

Additional details related to what I'm going to provide are available in today's press release and our revised company presentation, both of which are available on our website. I will now provide some new updates since our Q2 call in August, Beginning with our cab axial ADC BA3011. Regarding our BA3011 Phase 2 study in non We have consistently observed multiple clinical responses in axel positive treatment refractory lung cancer populations. Among patients receiving BA-three thousand and eleven monotherapy who previously experienced BD-one treatment failure and were evaluable for efficacy at 12 weeks, The observed objective response rate was 27.8 percent. In patients with eGFR Wild type non squamous lung cancer who previously experienced PD-one treatment failure, 33.3% of the patients had a partial response to BA 3011 monotherapy.

Speaker 2

Of note, axial expression in lung cancer defines a particularly poor prognostic group. Also these patients had experienced the failure of a median of 3 prior lines of therapy. So we believe that observing multiple responses in this treatment refractory poor We continue to observe clinical benefit in patients including multiple PRs at a TMPS score of 1%. We are exploring the potential clinical benefits in actual TMPS negative patients, which is important for understanding the market potential of BA3011 in lung cancer. Earlier this quarter, we also received verbal FDA feedback that we believe is supportive of a registrational path forward for BA-three thousand and eleven in lung cancer.

Speaker 2

Receiving formal written feedback later this month and plan to share more details and interim Phase 2 data to be presented at the ISLA conference and our KOL event in early December. Our Phase 2 potentially registrational study for undifferentiated pleomorphic sarcoma or UPS is ongoing and we continue to enroll the 2q3w dosing regimen for up to 20 patients. We have decided not to further advance the 3q4w dosing regimen across any cohorts in either the BA3011 or the BA-three thousand and twenty one studies due to suboptimal compliance with this dosing regimen, which is consistent with the lack of meaningful difference in efficacy observed with BA-three thousand and eleven in leiomyosarcoma. In regards to other bone and soft tissue sarcoma cohorts, we are pleased to have hit our internal for several sarcoma subtypes including synovial sarcoma, liposarcoma and osteosarcoma. As a reminder, our internal go criteria is defined as achieving greater than or equal to 1 complete response slash Partial response or a progression free survival rate of greater than or equal to 40% at 12 weeks.

Speaker 2

All cohorts are now completed and we plan to submit available data to a medical meeting in 2024. As previously communicated, our highest priority is to deliver innovative life changing therapies to cancer patients with Significant unmet medical needs. We have now observed multiple clinical responses in several treatment refractory solid tumor populations with our cabaxle ADC asset BA3011. We have also recently received feedback from the FDA on The BA-three thousand and eleven lung cancer registrational study design. Taken together, we continue to believe that BA-three thousand and eleven is an active agent in treatment refractory tumors and has the potential to become a 1st in class treatment for a significant number of patients who experience the failure of at least one prior line of therapy.

Speaker 2

Now turning to our 2nd CAB ADC asset BA-three thousand and twenty one, a CAB or 2 ADC. For our ongoing Phase II trials, we have completed enrollment of approximately 20 patients at the Q2W dosing regimen in both lung cancer and melanoma and anticipate to complete enrollment of up to 20 patients at the 2Q3W dosing regimen in head and neck cancer before year end. In treatment refractory patient populations, there are encouraging early responses in the Phase 2 melanoma study at the Q2W dosing regimen that are consistent with our Phase 1 expansion study. In particular, among the 8 evaluable monotherapy patients To date, with reported first scan across Phase 1 and Phase 2 clinical studies, we have observed 4 responses, 2 stable disease, one of which was a 17% tumor volume reduction in uveal melanoma and 2 with progressive disease. Notably, we have now observed a PR in a ROAR-two TNPS negative patient, which is likely to expand the applicable patient populations.

Speaker 2

We are continuing to collect data in the ongoing study and the remainder of patients in the targeted melanoma cohort will have had the opportunity to have first scan by year end. There are also encouraging early responses in head and neck cancer at 2Q3W. Also with a new PR observed in the WROR 2 TMPS negative patient, which makes 2 out of 2 responses at the 2q3w dose across Phase 1 and Phase 2. We are on track to complete all dosing regimens enrollment by year end and we'll continue to collect data in the ongoing study. The ROAR-two melanoma indication recruitment has been assisted by enrolling target agnostic patients followed by a retrospective target expression analysis, both of which resulted in quicker enrollment and the opportunity to target a larger melanoma patient population.

Speaker 2

In the case of head and neck cancer, VAR2 is expressed in a significant portion of these patients and therefore is also not anticipated to benefit from a biomarker assay, particularly in view of the observed 2Q3 WPR in a WROR-two TNPS negative patient, which maximize the potential applicable patient population. EURORDII positive lung cancer patients at Q2W, While we observe clinical benefit in terms of substantial stable disease and tumor volume reduction, there are no responses to date and thus we did not meet our internal criteria for advancing at this desk. Further, in view of these results and our supportive AXA lung cancer data, we currently do not plan to internally explore the more frequent 2q3w dose for this indication. Regarding the ovarian IIT, interim analysis of 10 patients in each of the BA3011 and BA3011 Q2W cohorts demonstrated modest disease control, but did not meet our internal criteria for advancing at this dose. We currently do not plan to internally explore additional dosing regimens at this time for this indication.

Speaker 2

Now on to our other promising CAB assets. Beginning with our CABC-two forty four antibody BA3071, which is applicable in areas of high unmet need and treatment refractory patients, represents a sizable commercial opportunity. We have encouraging Phase 1 observations to date and we continue to follow these patients' progress. In contrast to approved and earlier stage CTLA-four blocking antibodies, BA-three thousand and seventy one is designed to be conditionally Reversibly active in the tumor microenvironment. We believe this unique design enables our CAV C24 antibody to have the potential to deliver efficacy with a manageable safety and tolerability profile.

Speaker 2

In particular, a safety profile with less immune related adverse events across Multiple tumor types may allow patients to stay on therapy for longer and achieve clinical benefit from this important immunotherapy. The Phase onetwo trial is being conducted in tumors known to be responsive to CTLA for treatment and we are continuing to evaluate safety ability of BA3071 in monotherapy and in combination with nivolumab. As part of today's brief update, I'm happy to report that we have initiated the Phase 2 expansion cohort enrollment and remain on track for the Phase 1 data readout, which will be highlighted in our upcoming R and D Day on December 13. Next on to our potentially 1st in class Dual CAB bispecific T cell engager antibody CAB, FKAM, CAB CD3 or BA3,182. We previously announced FDA clearance of our IND for the treatment of advanced adenov carcinoma.

Speaker 2

And last quarter, we announced that the Phase 1 study was actively enrolling patients. That is progressing nicely through the dose escalation part of the Phase 1 study And we anticipate completion of the Phase 1 study with a full data readout remaining on track for next year. We believe that our dual cab design has potential to address Tremendous unmet need across multiple tumor types with the most common subtypes of adenocarcinoma, including colon, lung, breast, pancreas and prostate.

Speaker 3

I'd like

Speaker 2

to round out today's talk with a corporate update. 1st, in addition to our leadership team, Recently, Doctor. Ben Zheng joined BioAtlas as Senior Vice President, Head of Clinical Development and Operations. Ben brings over 20 years of experience in clinical practice, early and late stage drug development and asset management with a focus on oncology drug development. Prior to joining Biola, he held leadership roles with increasing responsibilities, including at Bristol Myers Squibb, Ipsen Bioscience and most recently a Senior Vice President, Head of Clinical Development at Pyxus Oncology, We oversaw clinical development activities of all oncology assets.

Speaker 2

His regulatory interaction experience coupled with his known track record of leading cross functional And finally, I'm pleased to report our progress with the medical and scientific communities with an additional abstract on BA3011 Alone or in combination with nivolumab in patients with lung cancer, which was accepted for presentation at the upcoming ISLAC conference this December. We also look forward to sharing these data and additional details around our cab axle ADC asset at our upcoming KOL event on December 4. Moreover, we will present our Phase 1 CAF CTLA-four BA3071 study data at our upcoming R and D day on December 13. With that, I would now like to turn the call over to Rick to review the Q3 2023 financials. Rick?

Speaker 3

Thank you, Jane. Cash and cash equivalents as of September 30, 2023 were $141,300,000 compared to $215,500,000 as of December 31, 2022. We now expect current cash and cash equivalents will be sufficient to fund planned operations, including prioritized CAB programs into the second half of twenty twenty five. Research and development expenses were $28,400,000 for the quarter ended September 30, 2023 compared to $19,800,000 for the same period in 2022. The increase of $8,600,000 was primarily driven by a 6 $300,000 increase in our clinical product development expenses primarily related to the launch and additional product development expenses.

Speaker 3

We expect our R and D expenses to remain variable from quarter to quarter As we continue to advance our clinical programs, then decreasing after we complete enrollment and focus development on selected High potential indication. General and administrative expenses were 6 $600,000 for the quarter ended September 30, 2023 compared to $6,300,000 for the Same quarter in 2022. The $300,000 change was attributable to an increase in professional services and consulting expenses for the 2023 period. We expect our G and A expenses remained flat to moderately increasing to support development of our prioritized cab programs. Net loss for the Q3 ended September 30, 2023 was $33,300,000 compared to a net loss of $25,800,000 for the same quarter in 2022.

Speaker 3

Net cash used in operating activities for the 9 months ended September 30, 2023 was $74,100,000 compared to net cash used in operating activities of $66,100,000 For the same period in 2022, the increase in net cash used in operating activities for the 1st 9 months of 2023 is primarily due to an increase in research and development expenses related to our program development efforts as compared to the 1st 9 months of 2022. And now back to Jay.

Speaker 2

Thank you, Rick. BioAtl is dedicated to delivering innovative life changing therapies to cancer patients. We observed that the CAB platform continues to demonstrate compelling clinical efficacy and safety across multiple therapeutic targets and formats in the most challenging cancer cases. As a result, we believe that there are mutually compelling opportunities for We will continue to advance selected cab assets that can address significant unmet medical needs in order to maximize shareholder value. With that, we will turn it back to the operator to take your questions.

Operator

Thank you. And ladies and gentlemen, we will now begin the question and answer session. One moment please for your first question. Your first question comes from the line of Brian Sheng from JPMorgan, your line is open.

Speaker 4

Hey, guys. Thanks for taking my question this afternoon. Given the responses that you I'm Saul here now for Axle in EGFR wild type and PD-one treatment failure patients. To the extent that you can, Can you give us a sense of the verbal feedback that you received on the registration of Path Forward from the agency? And what are the expectations that we could get in terms of the path forward at the December event?

Speaker 2

I'll start, maybe Eric could add if he has anything to add. So they gave us some very clear and Actionable items, both either in second and or third line therapies. And so we're just waiting for the written confirmation of the verbal Communication, and as soon as we have that, we expect that a little later this month and we'll be communicating that in far more detail in December. But hopefully, that's helpful and We think it's very promising.

Speaker 4

Okay. And then related to the IASLC The conference presentation next month, can you talk about just what we should expect in terms of The level of details regarding to response and can you also comment on the durability of the response that you've seen so

Speaker 2

Eric, do you want to lead off on this one? Sure. I think we'll be having a pretty standard poster presentation of the data sets, including spider plots, Swimmers plots and so you can anticipate that. Jay? Also, I would add, we'll also have Well, monotherapy obviously is our focus.

Speaker 2

We will provide the data on the combo, the updated data on the combination therapy and also our Maybe more and we'll see how that goes in the next few weeks. And we'll also remember the day after have a KOL event With an expert in lung cancer and also has been treating patients with some of their direct experience.

Speaker 4

Great. Thank you for taking my questions.

Operator

And your next question comes from the line of Kavir Palman from BTIG. Your line is open. Thank

Speaker 5

you for taking my question. So for non small cell lung cancer, Xadelphi has a Phase 3 EVOCO-one trial ongoing. And in their most recent press release, Cision also announced That they will be initiating a Phase 3 trial for their integrin beta-six targeting ABC. So I was just wondering if you could tell us how you're thinking about the competition here and what level of target expression overlap do you expect to see between TROPE-two, Beta-six and Axle?

Speaker 2

I'll start off and then maybe Eric or Sherry can add to this. So first off, I think You can look at both pieces of data. We've seen now multiple responses at 1% TNTS level. We're not seeing a strong correlation and responses and stable disease to the level of AXA expression. And this is, I think, observed by a number of different ADC cgroups at least in groups with ADCs studying lung cancer.

Speaker 2

We're also reporting responses in WORD-two as well from were 2 negative patients. So we're in the process right now of evaluating the frequency in the Axle negative patients based on IHC assay. And I think I'll just remind everyone that IHC assay has its own sensitivity. Just because you don't see actual by that kind of assay doesn't mean you have no actual expression, it's just at a much lower level. So we think that this has a Broadening the actual market opportunity here.

Speaker 2

It also because of the actual being a poor Prognostic indicator, meaning the patients have a very difficult time and these may be some of the most difficult patients to treat, remembering that all Our entire study, all the patients had a median of 3 prior lines of treatment and they were axial positive. So there's a real There is some significant likelihood that we're going to see responses below the 1% and we're going to find that out and add that to the datasets, Which could have a substantial impact on the market opportunity of our drug. So, we think a cross trial comparison is a little difficult When you when the others haven't gone into an axial positive data set and so we're going to look more broadly and I think we'll have more data on that as we go forward. Sherry or Eric want to add or clarify anything? If not, Krishna, I hope that answers your question.

Speaker 2

Yes. Jay, I think you characterize that very well. Thank you.

Speaker 5

Okay. Thank you. And just if you could provide any more details about the assay you're using for Assessment and how are you thinking about its use? Sorry, how are you thinking about its use like when moving from early stage to pivotal trials?

Speaker 2

Well, I think it's an immunohistochemical assay using an antibody against actual. It's not our therapeutic antibody, but it's one that was Specifically selected for detecting actual expression on cancer cells. And of course, we've been looking A lot of people are used to the h score where you look at the level or the amount of expression on each cell versus the number of cells that have expression on the And so it has an inherent sensitivity. So the fact that we're seeing Responses at such a low axle expression level is hinting that Axel may well be behaving like we're seeing and were too and that others are seeing with some of their ADC. So It's quite possible that and we'll let the data speak for itself, but it's quite possible that we won't need a companion diagnostic going forward.

Speaker 2

And but as of this moment, we believe we validated at the level of 1% or Greater with the TMPS score in these patients, refractory patients with 3 prior lines of therapy And show that we have a path forward here with these and that's in 3rd line. So we think we'll do even better in second line. But For the moment, we're going to look to see if we can have similar or even potentially greater impact in ones that are less than 1 Given that poor prognostic indication of actual expression with actual expression. So what's nice about The recruitment now is uncoupled from having to require at least to finish off this analysis. We can admit all patients to our study and do a retrospective analysis.

Speaker 2

This allows us to Those patients with less than 1% as well as some a few additional ones with 1% or greater. I'm going to add that data very quickly to our current data sets and as we go forward with some of our partnering discussions.

Speaker 5

Thank you. That's very helpful.

Operator

And your next question comes from the line of Kelly Hsieh from Jefferies. Your line is open. Hello? Kelly Shi, you might be on mute.

Speaker 6

Hello. Can you hear me?

Speaker 2

Now we can.

Speaker 4

Hi. This is Dave

Speaker 6

on for Kelly. And I have a question on 3,021. Do you plan to share a non small cell lung cancer data that you generated? And If you can share an insight that you can draw from the data such as patient baseline or expression, which contributed to Low responses. Also for CTLA-four, can you set the expectation on data details such as patient number or dose level we should expect at R&D Day?

Speaker 6

Thank you.

Speaker 2

Yes. We will definitely share the data on Non small cell lung cancer data, we're going to link that to a meeting. We may also include data from the more frequent dosing Some of the other indications like head and neck cancer and melanomas, we'll be looking for an upcoming meeting on that. It's still quite Possible that because we saw responses in lung, I'll remind everyone in Phase 1, but what we've basically shown that we're not driving responses Q2W level. We're also seeing responses with 2Q3W in head and back, but we So we think that there's potential to go to a higher dose.

Speaker 2

But as part of our prioritization process, which is It has to factor in a very encouraging data out of the AXA Lung data and we decided that it was best Prioritize Axle lung for that particular indication while we continue to advance melanoma in head and neck, especially given the very high Unmet need and those are particular indications. So we will get it, and we'll have quite a bit more data that we'll be putting together For that release. With respect to CTLA-four, we will we're on track To give quite a bit of detail on our Phase 1 dense escalation and we'll be giving an update on the Phase 2 Results that suffice it to say that the fact that we've already kicked off Phase 2 and that we have our first patient in, in Phase 2 that We think that it's heading in a very good direction. And I'll remind you that we've been studying patients that are known to be responsive to CTLA-four with a Cascade of 8 different indications that include things like melanoma and non small cell lung cancer. So we'll be discussing all of that And so I would just invite everyone on December 13 for the R and D Day, so we can give you a lot more detail around those studies.

Speaker 6

Thank you for taking our

Operator

Your next question comes from the line of Arthur He from H. C. Wainwright, your line is open.

Speaker 7

Hey, good afternoon, Jay, Rick, Sherry and Eric. Thanks for taking my question. So I just wanted to push the envelope a little bit further on the 3,011. These 33.3 percent ORR, Also including both Q2W and the more intensive dose regimen or it's only for the Q2W?

Speaker 2

Only Q2W. We haven't reported out on any more frequent dosing yet.

Speaker 7

Okay. Thanks for that. And then regarding to the program, for the Our 2 negative melanoma patient, which showed response, is that patient is in the Phase 2 study or it's From the 60130, could you remind that?

Speaker 2

For head and neck, you mean?

Speaker 7

No, for the melanoma, I believe.

Speaker 2

For melanoma, we have 2 excuse me, we have one response from Phase 1 That's included. And we have 3 responses from Phase 2.

Speaker 7

Okay. And So far, so you said you completed enrollment. So how many total patients we could expect the next data update?

Speaker 2

Well, I don't know what the valuable patients will be, but we had targeted 20 patients. So we'll see where we go on that and we reported on 8 evaluable patients today where we saw 4 responses out of 8 2 with stable disease and 2 with progressive disease. So quite encouraging at this stage.

Speaker 7

Got you. So my last question is for the 3,182, your bispecific Candidates for the afghan. So could you give us some more color about the enrollment status for that trial? I

Speaker 2

think it's going well. I mean, it takes about a month Plus or minus a week to kind of get from patient to patient. So I think we're on track here and continue to dose Escalade and I think it's early, but All good so far. And this is a particularly interesting drug and I get why I would be asking the same question Art that you are because This is one of those pan cancer opportunities with very high selectivity with a very potent mechanism that is enabled by cabs This is T cell recruiting capability. And so we're very eager to push it along.

Speaker 2

So it's going to move quickly and

Speaker 7

Awesome. Thanks for taking my question and congrats on the program. Talk to you soon.

Speaker 2

Thank you. Thank you. Look forward to it.

Operator

Thank you. And there are no further questions at this time. I would like to turn it back to Jay Shore for closing remarks.

Speaker 2

Thank you everyone for your attendance. We're really looking forward to continuing our discussions, especially with medical experts in Early December is only a few weeks away and we're looking forward to speaking with many of you at that time. Take care now and all the best.

Operator

Thank you, presenters. And ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.

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