Theriva Biologics Q1 2023 Earnings Call Transcript

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May 11, 2023

There are 6 speakers on the call.

Operator

Greetings, and welcome to the Sareva Biologics 2023 First Quarter Operational Highlights and Financial Results. At this time, all participants are in a listen only mode. A brief question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Chris Calabrese of LifeSci Advisors.

Operator

Thank you, Chris. You may begin.

Speaker 1

Thank you, operator, and good morning, everyone. Welcome to Cereva Biologics' Q1 2023 investor conference call. Leading the call today will be Steven Shallcross, Chief Executive and Chief Financial Officer of Theriva Biologics Doctor. Manel Kiscoio, General Director Sareva Biologics, European subsidiary and Doctor. Vince Wacher, Head of Corporate and Product Development of Sareva Biologics are also on the call and will be available to answer questions during the Q and A session.

Speaker 1

Cereva Biologics issued a press release this morning, which provided operational highlights and included financial results for the Q1 ending March 31, 2023. The press release can be found in the Investors section of the company website at www.tarevabio.com, together with the quarterly report on Form 10 Q for the quarter ended March 31, 2023, which we plan to file today with the Securities and Exchange Commission or SEC. In addition to the phone line, this call is being streamed live via web which will be archived on the company website, www.surivabio.com for 90 days. During the call, certain forward looking statements regarding Cereva Biologics and VCN Biosciences' current expectations and projections about future events will be made. Generally, the forward looking statements can be identified by terminologies such as may, should, expects, anticipates, intends, plans, believes, estimates and similar expressions.

Speaker 1

These statements are based upon current beliefs, expectations and assumptions and are subject to a number of risks and uncertainties, including those set forth in Cereva Biologics' filings with the SEC, many of which are difficult to predict. No forward looking statements can be guaranteed and actual results may differ materially from such statements. The information on this call is provided only As of the date of this call, Entireva Biologics undertakes no obligation to update any forward looking statements contained on this conference call on account of new information, future events or otherwise expect except as required by law. With that, I'd like to turn the call over to Steve. Steve?

Speaker 2

Thanks, Chris, and good morning. I appreciate everyone taking the time to join us today. I'd like to begin by reiterating our deep commitment to advancing our organization in addressing unmet needs for difficult to treat cancers. In the 1st few months of 2023, we continue to make steady progress across our oncology focused portfolio and remain on track to reach multiple value enhancing milestones. With cash runway into the Q3 of 2024, we believe we're well positioned to execute on our corporate objectives.

Speaker 2

As a reminder, our lead clinical candidate VCN-one is a systemically administered oncolytic adenovirus designed to collectively replicate within the tumor, degrade the tumor matrix and increase tumor immunogenicity. We believe these features position Vc01 for use in multiple indications in combination with multiple different types of therapies providing multiple mechanisms of tumor killing. Building on strong Phase I clinical data, we are advancing VIRAGE, our Phase IIb trial for patients with newly We are pleased with the progress to date. Enrollment and dosing are also underway for the Phase 1 trial of VCN-one in patients with brain tumors and we're preparing to engage with regulatory to discuss the development and potential registration pathway for VCN-one as an adjunct to chemotherapy in pediatric patients with advanced retinal blastoma. As part of our oncology focused portfolio, in addition to exploring the potential clinical benefits of VCN-one in different solid tumor indications, We continue to screen patients and enroll them in the 2nd cohort of the Phase IbIIa clinical trial of SYN-four, which we expect to complete in the Q1 of 2024.

Speaker 2

As a reminder, SYN-four is designed to prevent potentially fatal comes in patients who undergo allogeneic hematopoietic cell transplant, HCT, to treat hematologic cancers. In parallel, we've taken important steps to identify new candidates through our OV discovery platform, which is designed to protect systemically administered oncolytic viruses from the host immune system and may facilitate repeated administration of oncolytic virus therapies, thus increasing their efficacy and potentially allowing our pipeline programs to be used in standardized treatment cycles that are well established in cancer chemotherapy and immunotherapy. With this brief introduction, I will now provide an update and recent activities and share details on how these programs continue to position Tareva at the forefront of oncolytic virus development, starting with our lead program, BCN-one. It is well known that PDAC has one of the lowest survival rates among all cancers. And despite the growing incidence, efforts to improve upon standard of care chemotherapy treatments have largely stalled.

Speaker 2

We believe VCN-one has potential to address the urgent need for new treatment options for patients with PDAC. Enrollment and dosing are underway in VIRAGE, the multinational Phase 2b clinical study evaluating intravenous VCN-one in newly diagnosed PDAC patients treated with first line standard of care chemotherapy, gensitabine and napaxitaxel. The trial is expected to enroll up to 92 adults at up to 25 sites across the U. S. And Europe.

Speaker 2

We are encouraged by the enrollment to date, which is a testament to both the engagement of our clinical trial sites and the intense commitment of our experienced clinical team. In both the control arm and treatment arm, patients will receive gensitabine and nab paclitaxel Standard of care chemotherapy in 28 day cycles. In the treatment arm only, patients will also receive Systemically administered VCN-one 7 days prior to the 1st and 4th cycles of gensitabine and nab paclitaxel treatment. Primary endpoints for the trial include overall survival and VCN-one safety and tolerability. Additional endpoints include progression free survival, objective response rate and measures of biodistribution, VCN-one replication and immune response.

Speaker 2

Since this is an open label trial, progress will be monitored very closely and steps to accelerate the clinical program may be implemented if supported by emerging data. In addition to initiating the VIRAGE PDAC trial, We continue to work closely with key opinion leaders to refine our clinical strategy in retinal blastoma. We believe intravitreal VCN-one has the potential to treat vitreous seeds in children with retinal blastoma, and we also look forward to leveraging our orphan drug designation in this indication to facilitate protocol discussions with the FDA and Since current clinical practice varies and there is no regulatory guidance specific to retinal blood stoma drug development, We are working with our key opinion leaders in the U. S, Europe and Central and South America to develop new potential treatment options for this difficult to treat cancer. In parallel with company sponsored studies, the potential utility of VCN-one is being explored in a number of investigator sponsored studies that are underway at leading oncology research institutions around the world.

Speaker 2

In collaboration with the University of Leeds, we are evaluating intravenous CCN-one in patients with high grade brain tumors for scheduled for surgical resection. This Phase 1 trial is designed to evaluate the ability of VCN-one to enter Brain tumors following systemic administration. The leaky vasculature of many brain tumors may provide an excellent opportunity for systemically administered BcN-one to enter the tumor where it may replicate and initiate tumor cell killing, destroy tumor stroma and stimulate and antitumor immune response. Successful systemic delivery of ECL-one membrane tumors could provide a less Invasive intervention and potentially transform the way these cancers are treated. The lead investigators have initiated dosing and are exploring protocol refinements that may expand enrollment.

Speaker 2

Additionally, enrollment in the Phase 1 clinical study in collaboration with Hospital San Joao de Deo in Barcelona, Spain has been extended to additional patients. The study is designed to evaluate the safety and tolerability of VCN-one in patients with intraocular retinoblastoma refractory to systemic Interarterial or intravitreal chemotherapy or radiotherapy. We plan to hold the meeting with the FDA in the second half of twenty 23 to discuss the clinical development and potential registration pathway for VCN-one as an adjunct to chemotherapy in pediatric patients with advanced retinal blastoma. A separate investigator sponsored study is exploring the therapeutic potential of VCN-one in combination with durvalumab for patients with recurrent metastatic squamous cell carcinoma of the head and neck. We are encouraged by the data generated today, highlighted by the acceptable safety profile seen with Sequential dosing of VCN-one and durvalumab as well as biological activity observed in head and neck cancer patients who failed multiple Previous lines of therapy, including treatment with anti PD-one and PD L1 agents.

Speaker 2

We are planning to present additional efficacy and survival data from the study in the second half of twenty twenty three and We will continue to explore collaboration and partnering opportunities to advance VCN-one in this indication. The potential to enable the use of immune checkpoint inhibitors in refractory or in insensitive cancer patients is particularly compelling goal of BCD-one that may have valuable utility in a range of cancer indications. Turning to our ongoing Phase 1b2a clinical trial SYN-four or ribaxamase to prevent acute graft versus host disease or AGVHD in patients undergoing allogeneic HCT treatment for hematologic cancers. SYN-four is intended to address key limitations of broad spectrum antibiotics or IV beta lactam antibiotics and potentially improve treatment outcomes with this important and widely used class of therapeutics. The Phase IbIIa study is designed to assess the feasibility of using SYN-four in this specific patient population and to provide key information requested by the regarding the safety and tolerability of SYN-four in patients with impaired intestinal barrier function.

Speaker 2

As a reminder, the study consists of 3 sequential cohorts designed to compare different IV beta lactam antibiotics to treat fever following conditioning therapy. In each cohort, 8 patients were received SYN-four and four received placebo. Data from the first cohort were recently presented in April at the 33rd European Congress of Clinical Microbiology Infectious Disease. While the data remain blinded, interim analysis suggests that SYN-four is well tolerated and was not observed in the blood samples of a majority of the available patients. Building on these results, our 2nd cohort is underway and is designed to evaluate synfor in combination with purposeillin and tazobactam.

Speaker 2

This cohort will provide important additional safety information, in particular, whether oral SYN-four has the potential to alter IV antibiotic levels in this patient population. With our collaborators at Washington University, we continue to Explore the potential of SYN-four to reduce potentially fatal adverse events related to IV antibiotic use and allogeneic HCT recipients, including AGVHD and overgrowth and infection by pathological organisms such as C. Difficile and vancomycin resistant We are pleased with the progress of our clinical programs and in parallel continue to identify new candidates through our OV platform. Our proprietary technologies have tremendous potential for our pipeline and we look forward to building upon our foundation of Compelling proof of mechanism data generated with VCN-one and VCN-eleven to develop new albumin shield candidates incorporating Coming Catalyst will provide a solid foundation for execution and value creation. We remain focused on driving our clinical programs forward and exploring opportunities to expand our pipeline through our OB discovery platform.

Speaker 2

We remain on track to complete enrollment for Viroj by early 2024, hold the pre IND meeting with the FDA in the second half of twenty twenty three to discuss the clinical development and potential registration pathway for BCN-one as an adjunct to chemotherapy in pediatric patients with advanced retinoblastoma, present additional data from the study of VCN-one in combination with darolumab in patients with recurrent metastatic squamous cell carcinoma of the head and neck in the second half of twenty twenty three and complete the 2nd cohort of our Phase IbIIa clinical study of SYN-four for the prevention of acute graft versus host disease in bone marrow transplant patients in the Q1 of 2024. Now I'd like to briefly turn to our financial results for the Q1 ended March 31, 2023. General and administrative Expenses increased to $2,200,000 for the 3 months ended March 31, 2023 from $1,700,000 for the 3 months ended March 31, 2022. This increase of 29% is primarily comprised of increased expense related to the fair value of the contingent consideration, Additional salary and benefits related to new headcount, audit fees, consulting fees, travel and VC and administrative expenses not included in the prior year, offset by a decrease in consulting and legal costs related to the BCN acquisition.

Speaker 2

The charge related to stock based compensation expense was $87,000 for the 3 months ended March 31, 2023 compared to $85,000 for the 3 months ended March 31, 2022. Research and development expenses increased to $3,000,000 for the 3 months ended March 31, 2023 from approximately $2,600,000 for the 3 months ended March 31, 2022. This increase of 15% is primarily the result of increased Clinical trial expenses related to VCN-one not incurred in the prior year, offset by lower expenses related to our Phase IbIIa clinical trial of SYN-four and allogeneic HCT recipients and decreased manufacturing expenses related to our Phase 1a clinical trial of SYN-twenty. We anticipate research and development expense to increase As we continue enrollment in our VIRAGE Phase II clinical trial of VCN-one in PDAC and our ongoing Phase I clinical trial in retinal Soma, expand GMP manufacturing activities for VCN-one and continue supporting our VCN-eleven and other preclinical and discovery initiatives. The charge related to stock based compensation expense was $39,000 for the 3 months ended March 31, 2023 compared to $28,000 related to stock based compensation expense for the 3 months ended March 31, 2022.

Speaker 2

Other income was $370,000 for the 3 months ended March 31, 2023 compared to other expense of $21,000 for the 3 months ended March 31, 2022. Other income for the 3 months ended March 31, 2020 primarily comprised of interest income of $364,000 and an exchange gain of $6,000 Other expense for the 3 months ended March 31, 2022 is primarily comprised of an exchange loss of $23,000 offset by interest Cash and cash equivalents totaled $36,100,000 as of March 31, 2023 compared to $41,800,000 as of December 31, 2022. We remain deeply committed to improving patient outcomes for these very hard to treat cancers. And before we conclude today's call, I want to extend my sincere appreciation and gratitude for the foundational work that has brought us closer to delivering on our mission. I'd also like to thank the entire 3 of the team, our investors and the many people who have been supportive along the way, including our patients and their families.

Speaker 2

With that, we're happy to take some questions.

Operator

Thank you. We will now be conducting a question and answer session. One moment please while we poll for questions. Our first question comes from the line of James Molloy with Alliance Partner Global Partners, please proceed with your question.

Speaker 1

Hi, good morning guys.

Speaker 3

Thank you very much for taking my question. My apologies. I had it on mute there at first when I hit the star one. On the VIRAGE trial, when you anticipate you're looking for interim data here Q4 of 'twenty three, I believe. When you anticipate sort of This trial concluding and top line data coming through?

Speaker 2

So Jim, as we previously disclosed, we plan To complete the enrollment by early 2024. So that's all 92 patients in. Enrollments currently are on target with our expectations. We expect that sometime by the end of the year, we should have enough patients Enrolled that will give us the opportunity to evaluate the data and make some determinations on whether or not The trial and the patients in the trial are responding as we expect them to respond. That At that point in time, that will give us the opportunity to if we're foreseeing that robust response, to have discussions with the regulatory authorities and look at our Options on how we could accelerate the trial.

Speaker 2

Since the primary endpoint is overall survival, we expect This trial to go out beyond 'twenty four and into 'twenty five before it's fully completed, Obviously, the longer the better because obviously that would mean that patients are living longer. But we will have, in our In response rate that we observed or something close to it in the Phase 1 trial.

Speaker 3

Excellent. How goes the expectation for Actually, how go the UPenn and the LEADS IST trials? Any updates there that And when do you expect getting data potential from those trials? I know they're out of your hands a little bit.

Speaker 2

So you're correct on that. First the LEADS Trial, we have the 1st patient dosed there in the process of recruiting still. Recently, there were some proposed protocol amendments that would give the sponsor some additional flexibility to improve the enrollment rate. So that's ongoing, and we have no specific time line on when that study will conclude and And at what point we'll actually have the data. That effort is totally in their hands.

Speaker 2

The UPenn study, Similarly, we know that they're dosing patients. We have no specific data On exact numbers and what they're observing in terms of response rate, We would expect that sometime in the middle or going into the Q3 this year that We would have a communication and it's also possible that UPenn, which they are again controlling the study, may perhaps present some of that data at a public forum.

Speaker 3

How often is communication between You guys in the ISTs and again I know ISTs are outside of your hands, but what's the sort of the schedule of these updates? And you mentioned Potentially second half of twenty twenty three, is there a set board meeting or a panel meeting to Coordinate efforts on these trials?

Speaker 2

Depending on how active the site is, Sometimes we'll discuss and have discussions with them on a monthly basis, sometimes it's quarterly basis. The head and neck Trial, for example, we've been in active discussions with them because that data is being prepared to be released Sometime in Q3 at an upcoming conference. So in that case, the discussions with the PI are Pretty active and pretty regular. So again, it depends on the trial and how aggressively the enrollments are progressing.

Speaker 3

Understood. And then on SIN-four, I think you've made it clear, I think in the previous calls, you're looking to partner Continued development beyond sort of the Phase 1b2a that you're currently working on. How would you characterize the partnership environment for Sino4 currently?

Speaker 2

There is interest and we've had inbound interest. And again, these things take time to play out. And once we have something that's more definitive, we certainly will communicate that to everybody.

Speaker 3

Do you think it's something that is likely a 2023 or is it just still too early to even put a timeline on

Speaker 2

I can't put a timeline. I mean this environment is very tricky nowadays. You get a lot of interest. You have discussions. And There are a lot of reasons why something moves at the rate it does.

Speaker 2

And again, we're doing everything we And to actively engage with interested parties across our whole portfolio of products. And When we have something more definitive, we'll obviously again communicate that.

Speaker 3

Outstanding. Thank you very much for taking the questions.

Operator

Thank you. Our next question comes from the line of Jason McCarthy with Maxim Group. Please proceed with your question.

Speaker 4

Hi, guys. This is Chad on for Jason. Thanks for taking the question. So for the retinoblastoma program, I know it's Those meetings with FDA are coming up, but do you anticipate, if you can speak on it, if this could be A registrational trial, do you guys maybe go for P2 or P2.3? Or would you need, do you think, an additional study after that?

Speaker 2

So the bottom line is we won't know until we have a discussion with the FDA. But maybe, Manel, if you want to give a little bit more color about some of the discussions we've had with The KOLs and how we're moving forward?

Speaker 5

Yes, exactly. Yes, as anticipated by Steve, that's something that is going to be very dependent on our interaction with FDA, obviously. We are working very intensively, having some very interesting discussions with key opinion leaders, Both here in U. S. And in Europe with the top investigators, but also with some Involved in treatment of this disease in low and medium income countries.

Speaker 5

Because in that geographical areas, it's where retinoblastoma is much more And patients normally are not diagnosed as soon as it could be for instance in U. S. And that give us an opportunity to really impact with our treatment in that population that otherwise it's orphan of indications. So we are just getting a double effort with some relevant sites in U. S.

Speaker 5

And also sites In low and medium income countries, just trying to develop a program that it's going to be probably more In the line of health global health system, let's say, okay. But again, that's something that we To discuss with FDA, we have a very nice ideas, I think, to discuss and we are getting support for these ideas from the cluipineal leaders. And until we have this discussion, it's really hard to know exactly what's going to be developed the complete development pathway for this program, but eventually it could be.

Speaker 4

Great. Thanks for taking the question.

Operator

There are no further questions at this time. I'd like to turn the floor back over to Steve for closing comments.

Speaker 2

Thanks, Devin. Thanks again everyone for taking the time to join us today. We remain focused on driving our key programs forward and will continue to evaluate strategic opportunities that we believe will help further drive our shareholder value and long term success. Once again, Thanks for joining us and we look forward to future updates.

Operator

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation and have a wonderful day.

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Earnings Conference Call
Theriva Biologics Q1 2023
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