Bio Path Holdings Inc (NASDAQ: BPTH) Q4 2022 earnings call dated Mar. 31, 2023
Corporate Participants:
Will O’Connor — Investor Relations
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
Anthony Price — Senior Vice President of Finance, Accounting and Administration
Analysts:
Laura Engel — Stonegate — Analyst
Jonathan Aschoff — Roth Capital Partners — Analyst
Presentation:
Operator
Good morning, ladies and gentlemen. Welcome to the Bio-Path Holdings Full-Year 2022 Earnings Conference Call. [Operator Instructions] Following the formal remarks, we will open the call for your questions.
At this time, I’d like to turn the floor over to Will O’Connor of Stern Investor Relations. Sir, please proceed.
Will O’Connor — Investor Relations
Thank you, operator. Welcome to the Bio-Path Holdings conference call and webcast to review the company’s full year 2022 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 — Chief Executive Officer and Chief Financial Officer
Thank you, Will. Good morning, everyone, and thank you for joining us. 2022 was a year in which we made great progress executing on our mission to bringing new medicines to the battle against cancer. For the disease as evasive and resistant to treatments as cancer, we need to bring bold new approaches to fight this deadly disease. At Bio-Path, we are bringing true innovation to the fight against cancer with our DNAbilize platform across a number of hard-to-treat cancers. We are proud of the progress we’ve made and inspired by the hope we can bring to patients with limited or no treatment options. In December, we were delighted to report the initiation of an important Phase 1b clinical trial in BP1001-A in patients with solid tumors, including ovarian, endometrial, pancreatic, and triple negative breast cancer, some of the most challenging cancers to treat with today’s therapeutic toolkit.
BP1001-A is a modified product from prexigebersen sharing the same drug substance with enhanced nanoparticle properties. This trial is being conducted at several leading cancer centers, and will initially evaluate the safety of solid tumor patients. Patients diagnosed with recurrent ovarian and endometrial cancer often have poor outcomes and it is our hope that we may provide clinical benefits for such patients. We look forward to cohort completion and data readout from this study around midyear.
Next, let’s turn to the progress we have made with our lead product candidate, prexigebersen. We continue to make significant progress advancing Stage 2 of our Phase 2 clinical trials of prexigebersen for the treatment of acute myeloid leukemia or AML in combination with frontline therapy decitabine and venetoclax. The amended Stage 2 of this Phase 2 trial in AML is an open label two-stage multicenter study of prexigebersen in combination with decitabine and venetoclax in two cohorts of patients with previously untreated AML and relapsed resistant AML.
A third cohort includes treating relapse resistant AML patients who are venetoclax-resistant or intolerant with the two-drug combinations of prexigebersen and decitabine. 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 the coming weeks, we will assess the initial safety and efficacy of this combination therapy with the potential to qualify for expanded program status.
Turning now to our BP1002 program, which targets Bcl-2. If you know, Bcl-2 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. Venetoclax has shown activity against anti-apoptotic protein Bcl-2 and works by neutralizing the proteins’ BH3 domains. It is an approved treatment for chronic lymphocytic leukemia or CLL patients and untreated AML patients. However, with the exception of some patients treated with allogenetic 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. A total of six evaluable patients will be treated with BP1002 monotherapy in a standard 3+3 design with a starting dose of 20 milligrams per square meter. The approved treatment cycle is two doses per week over four weeks, resulting in eight doses administered over 28 days. The Phase 1b portion of the study will commence after completion of BP1002 monotherapy cohorts and will assess the safety and efficacy of BP1002 in combination with decitabine in refractory relapse AML patients. We expect cohort completion and initial data readout from this study around midyear.
Finally, let’s review the progress we’ve made with BP1003, which targets the STAT3 protein. STAT3 is a transcription factor that regulates various tumorigenic processes, such as tumor proliferation, metastasis, and drug resistance. Its overexpression and aberrant activation characterize mini-cancers, including breast, lung, ovarian, liver, and colon cancer. Activation of the STAT3 pathway in breast and ovarian cancer cells promotes tumor initiation, migration, and Taxol resistance. STAT3 also promotes 5-FU resistance in colorectal cancer cells. Its role in numerous malignancies made STAT3 a potential cancer therapeutic agent.
BP1003 is a novel liposome-incorporated STAT3 antisense oligodeoxynucleotide that efficiently reduces STAT3 expression and enhances the sensitivity of breast and ovarian cancer cells to Taxol and 5-FU. These results are in line with previous work in which BP1003 plus gemcitabine displayed enhanced antitumor activity in pancreatic, ductal adenocarcinoma. Together, these results strongly suggest that BP1003 combination therapy is a novel strategy for patients with advanced solid tumors. 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 look forward to filing an IND application for 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 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 $13.9 million or $1.91 per share for the year ended December 31st, 2022 compared to a net loss of $10.4 million or $1.55 per share for the year ended December 31st, 2021.
Research and development expense for the year ended December 31st, 2022 increased to $9.2 million compared to $5.9 million for the year ended December 31st, 2021, primarily due to manufacturing expenses related to drug product releases in 2022, increased enrollment in our Phase 2 clinical trial for prexigebersen and AML and start-up costs related to our Phase 1 clinical trial for BP1002 in refractory relapsed AML patients. General and administrative expense for the year ended December 31st, 2022 increased to $4.7 million compared to $4.5 million for the year ended December 31st, 2021, primarily due to increased legal fees.
As of December 31st, 2022, the Company had cash of $10.4 million compared to $23.8 million at December 31st, 2021. Net cash used in operating activities for the year ended December 31st, 2022 was $15.1 million compared to $9.9 million for the comparable period in 2021. Net cash provided by financing activities for the year ended December 31st, 2022 was $1.7 million.
With that, I’ll now turn the call back over to Peter.
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
Thanks Anthony. As I hope we have conveyed, we have an exciting year ahead with several potentially value creating clinical milestones across our portfolio, including cohort completion of data readout from our Phase 1/1b clinical trial of BP1001-A in solid tumors around midyear; cohort completion and data readout from our Phase 1/1b clinical trial of BP1002 in relapsed/refractory AML around midyear; an initial interim safety and efficacy analysis from our Phase 2 clinical trial of prexigebersen AML beginning in the coming quarter.
At Bio-Path, we never lose sight of our goal to bring new medicines to the fight against cancer. It is a singular mission that drives us to push the boundaries in our work every day with passion and purpose.
With that, operator, we’re ready to open the call for questions.
Questions and Answers:
Operator
Ladies and gentlemen, at this time, we’ll begin the question-and-answer session. [Operator Instructions]
Our first question today comes from Laura Engel from Stonegate. Please go ahead with your question.
Laura Engel — Stonegate — Analyst
Good morning, Peter. How are you?
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
I’m doing well, Laura. Thank you.
Laura Engel — Stonegate — Analyst
Good, good. Well, lots of good news, busy, busy as always. Fighting the good fight. I love that how you finished your comments. But could you just comment given recently reported year-end cash balances, obviously, the explanation for the change in the R&D year-over-year, which you’ve mentioned the manufacturing kind of details how that works a little bit differently, but just kind of what you see high level, of course, for the upcoming year comparatively speaking as we kind of model with everything, with all the different programs going on and try to kind of get some insight on that?
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
Yeah. A little background color. Recall in the previous two years with COVID, the manufacturing environment was tough for us and probably for everybody. And both our plants had COVID shutdowns and it was difficult for them to reestablish manufacturing. And we worked with them. And one of the key things we did was, we concluded that we needed to go out and double our supply chain in both the oligo manufacturer and the drug product manufacturer. The limitations on drug supply over those two years really slowed and limited our enrollment because obviously we’re not taking people in if we have a risk of cutting them off.
So, we were very successful in doubling our supply chain and so we’ve spent a lot of last year, kind of, of course, this year in the first quarter wrapping things up, but last year, building our supply of drugs. Recall that our drug product, remember, it’s not approved. So, therefore, the final drug product doesn’t have an economic value and it has to have be expensed as — and we do that once we release the product. We had a tremendous — we had a fourfold increase in our supply of drug vials, which is important because that’s what’s allowed us to kind of release the gates and get the enrollment going. But of course, the other side of that coin is that that tremendously increases your R&D expense because that’s where it goes.
So, part of that that you see on a year-over-year in the R&D expense is a fourfold increase in the drug supplies and that was several million dollars of that increase. I think that we would expect the — I don’t have a specific forecast, but I know that the total development expense should be in probably about maybe the $4 million range going forward, but that’s not a studied number. I’ve prepared a cash budget, but it goes out and lapse over into the first quarter of 2024. But it should not be that as high as it was simply because we won’t have that hard push on building drug inventory.
Laura Engel — Stonegate — Analyst
Great. Well, that was my guess, but I wanted to just go over that with you. And I appreciate you giving us the insight. Happy Friday, and I will get back in the queue.
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
Okay. Thanks. Have a great one.
Laura Engel — Stonegate — Analyst
You too.
Operator
[Operator Instructions] Our next question comes from Jonathan Aschoff from ROTH MKM. Please go ahead with your question.
Jonathan Aschoff — Roth Capital Partners — Analyst
Thanks. Good morning Peter. I was wondering, did you just say that your R&D will only be $1 million a quarter? Was that $4 million for the year?
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
I think that instead of $9 million, I would expect it to probably be in the $5 million or $6 million range, but I don’t have a studied number. What I think I tried to say was it would be down a couple of million from what we saw in the last year. So, because I won’t have that large inventory build-up.
Jonathan Aschoff — Roth Capital Partners — Analyst
Okay. All right. That definitely makes a lot more sense. I was wondering the venetoclax resistant or intolerant arm for 1001, when might we see data there as well as 102 in CLL?
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
Okay. The third cohort of the Phase 2 trial, is that what you’re asking for?
Jonathan Aschoff — Roth Capital Partners — Analyst
Yeah.
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
Yeah. That one — that one’s, we’ve had a lot enrolled, but those are very difficult patients. That would not be middle year, that would be showing up probably in the third or fourth patients — quarter. We’ve had quite a few come through, but those are pretty rough patients and it’s harder to find them, quite frankly. But we’ve had a lot come in. So, I think you’re looking in the second half of the year for that one. That’s the furthest or the slowest of the three cohorts.
Jonathan Aschoff — Roth Capital Partners — Analyst
Okay. How about the CLL trial with 1002?
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
The CLL trial we have — we only need one more patient. We have that patient to complete out that rollout for that first cohort. And we’ve added two more, including [Technical Issues], pretty good institution, which I understand they have looked at the protocol and think that they can do some good with it. So, I think that one — again, I think we’ve got to go several more months on that because those institutes won’t be final step and run till June. So, ideally in the third quarter, we’ll have that third stage and then can report out on that first cohort.
Again, the difficult part was — with that trial was there’s a real — it’s a low dose starting. It’s a monotherapy, so we don’t have a chemo component to it. And there’s a CAR-T trial going on that’s attractive to people who want to try.
Jonathan Aschoff — Roth Capital Partners — Analyst
Okay. And lastly, you said you would file that IND for 1003 this year, right?
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
That’s our goal. We finally — let me just again give the background color on that. What has slowed us down? We’ve done everything for that. We just have that final second species tox study to do. And to do that, we have to have our PK study available. Again specific for that, being able to demonstrate that in fact you have drug substance in the animal. We have a successful PK study that has — method, I’m sorry, that has worked in our other two drugs, has not worked in this third drug and we’ve gone through some analysis.
The molecule has a significantly lower melting point than the other two and we think that it may not be durable enough for the chemical additions and steps that go to when you get a plasma from an animal that can’t withstand it. And so it interrupts the binding, which gives off the signal that detects it. So, we’ve had to come up with another technique for the detection, and we have one now. And in fact, this past two weeks, we’ve been interviewing some large CROs that have an acceptable method and they don’t have much of a backlog, which is great on their mass spec side of the business that you need to use with this technique. And so we think we can get that round up and going on with the actual animal study, only take two months to test and report. So, we think we can make that IND by the end of the year. But that’s been the trouble. We’ve been all set. It’s just we’ve had to come up with a different technology to be able to detect the presence of the substance in the blood serum.
Jonathan Aschoff — Roth Capital Partners — Analyst
Thank you very much, Peter.
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
You’re welcome.
Operator
And ladies and gentlemen, with that, we’ve reached the end of today’s question-and-answer session. I’d like to turn the floor back over to Peter for any closing remarks.
Peter Nielsen — Chief Executive Officer and Chief Financial Officer
Thank you again everyone for joining us and for your continued support of Bio-Path. Have a great day. Thank you.
Operator
[Operator Closing Remarks]