Bio-Path Holdings, Inc. (BPTH) Q1 2021 Earnings Call Transcript

Bio-Path Holdings, Inc. (NASDAQ: BPTH) Q1 2021 earnings call dated May. 14, 2021

Corporate Participants:

Will O’Connor — Investor Relations, Stern Investor Relations, Inc.

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

Anthony Price — Senior Vice President of Finance, Accounting and Administration

Analysts:

Jonathan Aschoff — ROTH Capital Partners — Analyst

Yi Chen — H.C. Wainwright & Co. — Analyst

Presentation:

Operator

Good morning, ladies and gentlemen. Welcome to the Bio-Path Holdings First Quarter 2021 Earnings Conference Call. [Operator Instructions]

I would now like to turn the call over to Will O’Connor of Stern Investor Relations. Please proceed.

Will O’Connor — Investor Relations, Stern Investor Relations, Inc.

Thank you, operator. Welcome to the Bio-Path Holdings conference call and webcast to review the Company’s first quarter 2021 financial results, and to provide an update on recent pipeline and corporate developments. Earlier, we issued a press release which outlines the topics that we plan to discuss on today’s call. The release is available at biopathholdings.com.

With me today from Bio-Path are President and CEO, Peter Nielsen; and Senior Vice President of Finance, Accounting and Administration, Anthony Price.

Before we begin, I’d like to remind you that today’s discussion will contain forward-looking statements that involve risks and uncertainties. These risks and uncertainties are outlined in today’s press release and in the Company’s recent filings with the Securities and Exchange Commission, which we urge you to read. Our actual results may differ materially from what is discussed on today’s call.

With that, I’ll now turn the call over to Bio-Path’s CEO, Peter Nielsen.

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

Thanks, Will. Good morning, everyone, and thank you for joining us. 2021 is off to a terrific start, marked by a substantial progress across our portfolio of targeted nucleic cancer drugs. We are excited by the advances we’ve made, but are even more excited by what is to come for Bio-Path.

Let me now turn to discuss these advances and opportunities in greater detail. I’ll begin with our lead product candidate, prexigebersen, where we continue to make solid progress. In April, we were delighted to publish an analysis highlighting the potential of prexigebersen within the antisense oligonucleotide drug delivery landscape in the peer-reviewed journal, Biomedicines In addition, Stage 2 of our Phase 2 clinical trial of prexigebersen for the treatment of acute myeloid leukemia, or AML, in combination with frontline therapy, decitabine and venetoclax, continues.

As we have previously reported Phase 2 clinical development of prexigebersen and AML commenced with Stage 1 of our Phase 2 clinical trial, which was open-label and treated de novo AML patients with a combination of prexigebersen and low-dose cytarabine, or LDAC. The combination of prexigebersen and LDAC was shown to be safe and more efficacious to treat this class of patients than with LDAC alone.

As many of you know, there has been an evolving landscape for standard of care in AML. Despite these new therapies, there are still patients who are refractory or resistant, and those are the patients we aim to help. As standard of care evolved, we adapted our trial design to reflect these changes. The amended Stage 2 of this Phase 2 trial in AML is an open-label Phase 2 two-stage multi-center study of prexigebersen in combination with decitabine and venetoclax in two cohorts of patients with previously untreated AML and relapsed/refractory AML. A third cohort includes treating relapsed/refractory AML patients who are venetoclax-resistant or intolerant with the two-drug combination of prexigebersen and decitabine.

The full trial design plans have approximately 54 evaluable patients for the cohort treating relapsed/refractory AML patients with the triple combination treatment of prexigebersen, decitabine and venetoclax, and the cohort treating AML patients who are venetoclax-resistant or intolerant with the two-drugs combination of prexigebersen and decitabine, with a review of both cohorts performed after 19 evaluable patients. The full trial design plans have approximately 98 evaluable patients for the cohort treating untreated AML patients with the triple combination treatment of prexigebersen, decitabine and venetoclax with a preliminary review for the cohort performed after 19 evaluable patients and a formal interim analysis after 38 evaluable patients. The higher number of patients in the full trial design for the untreated AML patient cohort is due to the higher baseline response of the frontline therapy with previously untreated AML patients.

The primary endpoint for this study will be the number of patients who achieve complete remission, which includes complete remission with incomplete hematologic recovery and complete remission with partial hematology recovery. An interim analysis will be performed on each cohort to assess the safety and efficacy of the treatment. In April, we were excited to announce the successful completion of the study run-in of Stage 2 of the Phase 2, which had a clean side effect profile and lack of toxicity. We are also very encouraged by the efficacy signal shown in this dataset, with five of the six evaluable relapsed/refractory and newly diagnosed AML patients demonstrating clinical activity. We look forward to advancing this study as we believe its unique design provides us with several definable registration pathways.

As I mentioned on our last call, the United States Patent and Trademark Office issued a third patent in our family of platform intellectual property that offers expanded defense of our DNAbilize platform technology. In addition, we were pleased to receive the issuance of a patent related to prexigebersen in combination with either cytidine analogue, such as decitabine, or the Bcr-Abl tyrosine kinase inhibitors dasatinib and nilotinib. This addition further strengthens our intellectual property portfolio and completes our already granted patents. These new patents protect the unique therapy combination and supports our ongoing investment in this program to bring in new treatment option to patients with AML who have limited treatment options.

As I have said before, we will continue our efforts to build a fortress of protection around our technology as it safeguards our platform technology and target-specific technology and is a deterrent to would-be competitors who — and creates value around our core competencies.

Next, I’d like to turn to our planned Phase 1 clinical trial of prexigebersen-A in patients with advanced solid tumors, including ovarian, uterine, pancreatic, and hormone refractory breast cancer. Prexigebersen-A, a fourth Bio-Path drug candidate, is a modified product from prexigebersen sharing the same drug substance with enhanced nanoparticle properties. This trial will be conducted at several leading cancer centers and is planned initially to evaluate the safety of prexigebersen in solid tumor patients. Patients diagnosed with recurrent ovarian and endometrial cancer often have poor outcomes. And it is our hope that prexigebersen may provide clinical benefit for such patients.

Turning now to BP1002, our second therapeutic candidate, which targets Bcl-2. In April, we presented a poster highlighting preclinical BP1002 data at the 2021 American Association for Cancer Research Annual Meeting. BP1002 targets the protein Bcl-2, which is responsible for driving cell survival in up to 60% of all cancers. High expression of Bcl-2 has been correlated with poor prognosis for patients diagnosed with AML. The data presented in the AACR poster show that venetoclax-resistant cells are sensitive to the inhibitory effects of BP1002 combined with decitabine, suggesting that this combination is a potential treatment for patients who have relapsed from frontline venetoclax-based therapies.

Venetoclax has also shown activity against anti-apoptotic protein Bcl-2 and works by neutralizing the protein’s BH3 domain. It is an improved treatment for Chronic Lymphocytic Leukemia, or CLL patients and untreated AML patients. However, with the exception of some patients treated with allogeneic hematopoietic cell transplantation, disease relapse invariably occurs oftentimes due to BH3 domain mutation over time. BP1002 also targets the Bcl-2 protein. However, BP1002 activity is based on blocking the Bcl-2 messenger RNA and not the BH3 domain. As a result, we believe that BP1002 could provide an alternative for venetoclax patients who have relapsed, including AML patients who previously received venetoclax treatments.

Finally, let me briefly review the progress we’ve made with our third drug candidate BP1003, which targeted the STAT3 protein. This program has shown promising preclinical data, and we are very excited for the future of this program. We are studying BP1003 for the treatment of pancreatic cancer in a patient-derived tumor model. Previous models have shown the drug to successfully penetrate pancreatic tumors and enhance the efficacy of standard frontline treatments. We are particularly excited to launch our first in-human validation of this cutting-edge therapy in an especially challenging cancer indication that has limited treatment options. We’re aiming to file an IND application with this very promising product candidate later this year.

With that, I’ll now turn the program over to Anthony Price for a brief review of our first quarter 2021 financials, along with balance sheet highlights. Anthony?

Anthony Price — Senior Vice President of Finance, Accounting and Administration

Thanks, Peter. The Company reported a net loss of $2.4 million, or $0.43 per share for the three months ended March 31, 2021, compared to a net loss of $3.3 million, or $0.90 per share for the three months ended March 31, 2020.

Research and development expense for the three months ended March 31, 2021 decreased to $1.3 million, compared to $2.0 million for the three months ended March 31, 2020, primarily due to decreased preclinical expense related to timing of activities for BP1003, as well as decreased clinical trial expense due to timing of activities for our Phase 2 clinical trial of prexigebersen in AML and our Phase 1 clinical trial of BP1002 in lymphoma.

General and administrative expense for the three months ended March 31, 2021 decreased to $1.2 million, compared to $1.3 million for the three months ended March 31, 2020, primarily due to decreased franchise tax expense.

As of March 31, 2021, the Company had cash of $30.8 million, compared to $13.8 million as of December 31, 2020. Net cash used in operating activities for the three months ended March 31, 2021 was $1.6 million, compared to $2.5 million for the comparable period in 2020. Net cash provided by financing activities for the three months ended March 31, 2021 was $18.6 million.

With that, I’ll now turn the call back over to Peter.

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

Thanks Anthony. As I hope we’ve conveyed on the call this morning, we have made great progress in 2021 that leaves us well positioned to achieve value creating milestones throughout the balance of the year. With our continued publication and presentation of data, we are building a body of scientific and clinical evidence in support of our programs, while greatly enhancing the visibility of our platform among relevant audiences. It is my hope that with this expanded knowledge of the potential of our DNAbilize platform, we are building a ground swell of interest in our technology and the various ways it can be used. This should enhance clinical trial enrollment, business development efforts, and more. This is just the start and I couldn’t be more excited about the future of Bio-Path.

With that operator, we are ready to open the call for questions.

Questions and Answers:

Operator

[Operator Instructions] And our first question is from the line of Jonathan Aschoff with ROTH Capital Partners.

Jonathan Aschoff — ROTH Capital Partners — Analyst

Thank you and congrats on the progress, Peter. Can you give us any kind of update on the clinical data release timing for prex and 1002, just particularly over the rest of this year and the first half of next year?

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

Yes. Good morning, Jon. We — as you know, I’ve been rebuilding my drug supply and we had a COVID plant occurrence that pushed off some of our batches. So, we’ve been managing our enrollment to the supply we have. That will start ramping up starting early next week and we have some more batches planned through the end of the year. With that being said, I think that we’re over half the ways in one — towards 2019 evaluable in one of the cohorts, and there is a possibility we’ll get that readout by the end of the year. And certainly, by, I think, the first half of the following year would be any remaining — the remaining two cohorts. But we had had pretty high response of treating. We were at one point treating 12 to 15 patients. So — but we needed to manage our supply. So that’s the current view.

We’ve been getting good results. I mean, you recall we put on the six evaluable safety run-out patients. The safety profile was excellent. And we had positive efficacy enhancement over all of the various frontline treatments in the three cohorts. It’s just — obviously, it’s a small dataset. So, that’s the view I have right now.

Jonathan Aschoff — ROTH Capital Partners — Analyst

Peter, what cohort is most enrolled? Was the treatment-naive one?

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

Currently is the third cohort with the venetoclax intolerant-resistant patients.

Jonathan Aschoff — ROTH Capital Partners — Analyst

Okay. And then what’s your biggest treatment landscape evolution concerning AML that could possibly force you to redesign the clinical path for prex again?

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

I’m not really that focused in that regard because whatever the thing — the way it’s worked before, it’s a combination treatment. So, we obviously adapt if there is a change in the frontline because that’s typically the way people will want us to configure our treatment option. And I think venetoclax is settled in pretty much as — for these treatments. The main drug treatment that with dasatinib. And so, I think we’re well on our way.

The other thing is, every time we’ve done a treatment comparison or development, preclinically, we always show an incremental efficacy benefit. So, it’s really just keeping track with the — with what’s going on in the frontline. And I view that to be a pretty stable thing right now. Certainly, in our third cohort where you have dasatinib and prexigebersen. Dasatinib alone is the frontline for those patients. And I think that’s a relatively low bar for us. So, I’m anxious for us to try to get to that. So, I mean, that’s kind of my view.

Jonathan Aschoff — ROTH Capital Partners — Analyst

Thank you, Peter.

Operator

Our final question comes from the line of Yi Chen with H.C. Wainwright.

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

Hi, Yi.

Yi Chen — H.C. Wainwright & Co. — Analyst

Thank you. Hi, Peter. Thank you for taking my questions. Could you tell us the current enrollment status of the Phase 1 lymphoma and CLL trial?

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

For the what? For the…

Yi Chen — H.C. Wainwright & Co. — Analyst

Yeah. The BP1002 trial, the current enrollment status?

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

That trial has had one evaluable patient enrolled and we’re currently looking at other patients. We have good cancer centers. BP1002 is starting out slow and the problem is, as you well know, when you do a dose escalating study, it’s hard to get people started at the low-end because the oncologists will say, well, it’s a safety trial, and you can’t expect a lot of benefit at the low. I mean, we’re starting at 20 milligrams per meter squared, so you have to kind of struggle through those early phases. So, we’re looking to do that. But we had had very positive responses from our sites that want to participate. We have MD Anderson, Georgia Cancer Center, and the Sarah Cannon, those were all good sites. So we have three sites to do this dose escalating trial. So, I think it will get more rapid once we get up into the higher doses.

Yi Chen — H.C. Wainwright & Co. — Analyst

And do you believe this H1 [Phonetic] trial can still report data before the end of this year?

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

Yes. It would be a cohort. It’d be — and again the focus on the first one, for example, three patients at 20 milligrams per square meter would be the first cohort. It’d be safety. I don’t know how much efficacy you can report on that early dose. So, it would go from 20, 40, 60 and 90 are our dose points. They may be go to 135. But I think those first four are the ones that would be the principal focus. So, we certainly ought to be able to get one of those first cohort in.

Yi Chen — H.C. Wainwright & Co. — Analyst

Okay. Got it. And for prexigebersen-A, how quickly do you think the trial — the Phase 1 trial in solid tumor can recruit patients in the current environment of the pandemic?

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

Well, there seems to be a lot of — this is going to be a treatment for solid tumors that systemic, IV and endometrial and advanced ovarian or one of them, they can recruit in pancreatic. We’ve done testing in that. And so, the interest has been very high. And we have again MD Anderson in that. I recall we have a couple others that would be coming in. We have waited these extra four months, the FDA had asked us to do two more sets of testing and one of them was the particulates. And particulates are hard for us because of our product being a little bit different, you have to do it on the drug product, which is reconstituted liposome. And so, you have to — for those, you have to go through mechanisms to break down all the liposomes and just get the nanoparticles and some of the things you use to do that in aggregate cells and coalesce [Phonetic] and make a little more challenging. But we, in fact, has now just got the word in the last week or two that we’ve got that test successfully done. And so, the FDA with the December call we had with them just gave us the two things we needed to. So I think we’ll get our IND here fairly quickly now as they past us in. And then there is a real need for this, Yi.

And we’ve had — as you know, we’ve had two AACR papers that we have been well received posters at their Annual Meeting. And so, I think there is a lot of interest in getting a kind of treatment like this that can help manage that. Obviously, the first part again will be a safety assessment, fortunately since prexigebersen is the same drug cell since the formulation is difficult [Phonetic] to get a better nanoparticle, smaller particles, but since that safety is out there with AML, we get to start at the higher dose. I think it’s 60 milligram per meter squared. So, we may not have to go through the hurdle of people not wanting to enroll our patients if they don’t think they can get any benefit. So, I think we can maybe be better on that as well, but everything I know this is a treatment that’s really being looked for.

Yi Chen — H.C. Wainwright & Co. — Analyst

So we can expect this trial to be initiated in the third quarter, right?

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

Yes. And I think we’ll get the IND pretty quickly because we satisfied everything they want, and once we get that IND it will be opened up ready to go. So, certainly, we should be dosing our first patient in the third quarter, for sure.

Yi Chen — H.C. Wainwright & Co. — Analyst

Got it. Thank you.

Operator

Well, thank you, ladies and gentlemen. That’s the end of our Q&A session. I’d like to turn the call back over for any closing remarks.

Peter Nielsen — President, Chief Executive Officer, Chief Financial Officer

Thank you, again, everyone for joining us and for your continued support of Bio-Path. Have a great day.

Operator

[Operator Closing Remarks]