Brainstorm Cell Therapeutics Inc.
Q3 2019 Earnings Call Transcript

Published: 14 Nov 2019

[Operator:]

Good day. Welcome to the BrainStorm Cell Therapeutics Third Quarter 2019 Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] As a reminder, this call is recorded.I would now like to introduce your host, Sean Leous from ICR Westwicke. You may begin, sir.

[Sean Leous:]

Thank you for joining the BrainStorm Cell Therapeutics third quarter financial results conference call. Before we begin the opening remarks, we would like to remind listeners that this conference call contains numerous statements, descriptions, forecasts, and projections regarding BrainStorm Cell Therapeutics, Inc. and its potential future business operations and performance statements regarding the market potential for treatment of neurodegenerative disorders such as ALS and MS, the sufficiency of our existing capital resources for continuing operations in 2019 and beyond, the safety and clinical effectiveness of our NurOwn technology platform, our clinical trials of NurOwn and related clinical development programs, and our ability to develop strategic collaborations and partnerships to support business planning efforts.Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond our control, including the risks and uncertainties described from time-to-time in our SEC filings. Our results may differ material from those projected here on today’s call. We undertake no obligation to publicly update any forward-looking statements.Joining me on the call today will be Chaim Lebovits, President and CEO of BrainStorm; Dr. Ralph Kern, Chief Operating Officer, Chief Medical Officer; and Preetam Shah, our Chief Financial Officer. We will be available to answer your questions during the Q&A session.

[Chaim Lebovits:]

Thank you, Sean. Good morning and good afternoon to everyone on the third quarter earnings call. Let me begin by thanking everyone for participating in today’s call, such an early time and for all those that send their questions prior to our call. We will address many of your pre-submitted questions in the opening remarks and we’ll look forward to addressing any additional questions or comments you may have in the Q&A session.On behalf of the entire BrainStorm management team, I want to express our thanks for the ongoing and continued support of so many. I must thank and acknowledge, first in all, the patients, their families, caregivers and all those who are helping us advance the Phase 3 ALS trial and the Phase 2 progressive MS trial. Also I want to thank the team here at BrainStorm, who fully devoted themselves to advance best-in-class and potentially life altering therapies. Finally, I want to thank our shareholders for their continued ongoing support and our collective journey towards FDA approval.During this quarter, we achieved major milestones. Firstly, we fully enrolled our Phase 3 ALS clinical trial, which we announced on October 11. We began enrollment in October of 2017, even though many were skeptical and two years later we enrolled all 200 patients. Starting to evaluate the repeated intrathecal administration of NurOwn cellular therapies. The medical statistics, clinical centers of excellence. University of California, Irvine, Cedars-Sinai Medical Center, California Pacific Medical Center, Massachusetts General Hospital, MGH, UMAC, Mayo Clinic provided patients with the best care available by meticulously pursuing clinical trial excellence. Now the clock is ticking and we anticipate publishing the results in the last quarter of 2020.A second important event that occurred during this quarter was independent Data Safety Monitoring Board, the DSMB. They completed their secondary specific internal analysis of safety outcomes of the first 106 patients that received repeat dosing of NurOwn in the Phase 3 trial ALS. The DSMB board indicated that the Phase 3 clinical trials with continuous plan without any changes in the protocol, again have to thank our medical team under the leadership of Dr. Kern and the clinical side of our theaters, who day in and day out are committed to providing comprehensive and accurate clinical data and top tier patient care.We’re also happy that our second chosen indication for progressive MS is proceeding very well. We have now all five centers enrolling. We announced the three centers, Cleveland Clinic, Stanford School of Medicine and the University of Southern California. We will be announcing very soon the two additional distinguished world-renowned centers. This Phase 2 study will evaluate validated MS efficacy outcome measures and sophisticated CSF and certain biomarkers.Currently eight patients have been enrolled, some of them had all three treatments already. Having announced our first enrolling center at the end of February, in 10 months, we have rapidly enrolled almost 50% of the patients. This is a testament to all dedicated to the filling an unmet medical need in progressive MS. We anticipate the readout of this trial also in the fourth quarter of 2020. We will consider interim results earlier, perhaps April or March of 2020.Many shareholders continued to inquire about proceeds from the Hospital Exemption pathway. This past quarter we received an additional $1.6 million from this program, we call it Israeli clinical expenses. The Hospital Exemption pathway, which was developed in the European Union and now is in Israeli regulatory rule as well helps us to better treat Israeli and the international patients with ALS.During this past quarter, we had the opportunity to meet with the FDA and one of the leading ALS efficacy groups, I AM ALS with CNO, Brian Wallach and their board member Dan Tate. We made some continues and good engagement with the FDA. We are encouraged by their ALS guidelines that were published at the end of September and we’ll look forward to conducting productive, engaging meetings in the future with the FDA.We’ll also convene the very important round table in Washington, D.C. in late December with the leading efficacy groups in ALS members of the U.S. Congress, Caucus and their staff. The round table goals were to educate and inform leaders from the ALS community on the clinical development program for the investigational therapy NurOwn and to provide a forum for discussion and answer their questions. At the end of the round table to a degree, that there is incredible excitement from the ALS community about the hope for this investigational therapy.The management team of BrainStorm continues to engage in high level strategic partnering and collaborating discussions – collaboration discussions. These discussions are ongoing and continued to remain confidential as we are unable to disclose the details as we have signed on nondisclosure agreements. What I can tell you that any partnering or collaboration agreement will only take place if it is in the very best interest of patients, the families, caregivers, as well as our wonderful shareholders.I would like to hand over the call to Dr. Preetam Shah, our new CFO to discuss our financials. But before I bring him in to discuss the financials, I’d like to say, that Preetam came on board a little over two months ago to expand BrainStorm’s Investor Relations program and to advance corporate and business agenda. Preetam brings with him over 18 years of industry experience, trust finance, investment banking and deal making along with his superior academic credentials and knowledge of the life sciences sector. He is an invaluable asset to BrainStorm going forward, formulating his corporate and capital strategy as we continue to grow the company. We’re all thrilled to have him onboard. Preetam?

[Preetam Shah:]

Thank you, Chaim. First of all, I’d like to start out by saying it’s great to be here. My first earnings call at BrainStorm. I joined BrainStorm really to be part of the team that has the chance to fundamentally change outcomes for patients with devastating and heartbreaking neurodegenerative diseases. I firmly believe that BrainStorm has the potential to be the first in class autologous stem cell therapy for ALS and other neurodegenerative diseases. I’ve been following BrainStorm for a while, before I joined and very excited to be part of this team. It is my pleasure now to walk you through our recent financial performance.Research and development expenses net for the three months ended September 30, 2019 were $4.01 million compared to $1.97 million net for the three months ended September 30, 2018. Excluding participation from IIA and CIRM under the grants and the proceeds received from the Hospital Exemption regulatory pathway research and development expenses increased by $1.59 million from $4.07 million in the third quarter of 2018 to $5.66 million in the third quarter of 2019. This increase year-over-year was primarily due to expenses in connection with our ongoing ALS Phase 3 and progressive MS Phase 2 clinical trials.General and administrative expenses for the three months ended September 30, 2019 were $1.54 million compared to $1.26 million in the three months ended September 30, 2018. This increase year-over-year was primarily due to increase in payroll, stock-based compensation, consultants and rent and was partially offset by a decrease in travel and stock management costs.Net loss for the three months ended September 30, 2019 was $5.6 million or negative $0.25 per share as compared to a net loss of $3.17 million or negative $0.15 share for the three months ended September 30, 2018. Cash, cash equivalents and short-term bank deposits were $2.1 million at September 30, 2019 compared to $2.7 million at June 30, 2019. Our total available funding, which includes cash on hand as well as remaining non-dilutive CIRM and IIA grants amounts to approximately $5.9 million. For further details on our financials, please refer to our Form 10-Q filed with the SEC.Back to you Chaim.

[Chaim Lebovits:]

Thank you, Preetam. Due to the cash on hand at the end of the quarter, it was very good to be able to announce this morning an additional grant from the I AM ALS and that’s a wonderful support from a very important type of group in the MS community. And we’re looking forward to be announcing soon additional non-dilutive grants. That will be wonderful.So I’ll thank you all for your ongoing support to BrainStorm Cell Therapeutics. And I look forward to your questions. As mentioned with me joining to answer the Q&A is also Dr. Kern and Preetam. But before we turn it over to the line to Q&A, we allowed many shareholders that can be open, such an early hour to send a question before the call and we will address some of these questions. I would appreciate, Sean, if you can read out the questions and we’ll give the answers.

[Sean Leous:]

Thank you. First question is, during the last conference call there was a discussion of the upcoming September meetings with the FDA was mentioned, later there were pictures released to BrainStorm management meeting with ALS patients and advocates on September 25 and FDA leaders meeting with patient advocates on September 26. Did BrainStorm management meet with FDA officials or other government regulatory bodies around the same time?

[Chaim Lebovits:]

Yes. We’ve got many questions in this regard. And I think, we should make it a little bit older. So first of all, yes, there was a BrainStorm meeting called by I AM ALS with the FDA. We could do a joint meeting with FDA, and it was a very productive meeting. We have seen the management on the FDA, Dr. Peter Martin and Dr. Woodcock. The second meeting was towards the end of September, we hosted a round table meeting with ALS advocates. This meeting too was announced in a press release, the company issues and I discussed it also on the opening statement.I also mentioned in the last quarter that we’re going to have an additional September meeting with the agency. So that meeting did not happen. While we do have ongoing meetings with the FDA, we reschedule that meeting in order to follow the date of the release of the FDA ALS guidance document. The progress we made in the ALS guidance document is very important and it supports our dialogues around the ALS clinical trial outcome. And as we move towards completion of the Phase 3 trial and eventually in support of a BLA.

[Sean Leous:]

Second question. Did Mrs. Mary Kay Turner and other BrainStorm executives meet with the FDA or other government regulatory bodies at the end of October.

[Chaim Lebovits:]

Yes. So people think, as a management we are in the hallways of Congress or outside the FDA building, et cetera. So Mary Kay Turner is our VP of Government Relations and Patients Advocacy. In that capacity, she regularly meets patient advocacy organizations and other key influential groups or people in Washington, D.C. and other cities across the country. She tends events with the sole purpose of raising awareness around ALS. Mary Kay is not a lobbyist. She’s a Patient Advocate and a critical voice or BrainStorm to a very large audience.

[Sean Leous:]

Dr. Shah, you have a very strong background in business and science and you appear to be a solid addition to the BCLI executive team. How do you plan to use your training and context to increase shareholder value? How do you plan to get more widespread recognition of BrainStorm from investors on Wall Street?

[Preetam Shah:]

Thank you, Sean for the question. So one of the things I started doing, once I came on board was to focus and to reach out to institutional and long only investors quit previously invested in other neuro and cell therapy companies. Many have already met BrainStorm’s management team in the past, while some haven’t. We started the process of educating and bringing them up to speed on our story.Look, we have been largely ignored and unnoticed and have been on the radar for many years to some of the larger funds due to our market cap and share liquidity profile. We are having regular dialogues with these funds now. Awareness is key to our success. I found that although these large healthcare funds haven’t yet invested in us, many of them are very interested in the BrainStorm story and promise and more importantly in the science supporting our data and hence our following our advancement very closely.The other thing, like Chaim mentioned that we’ve been doing it to explore partnerships and business development discussions with several parties under NDA. At the end of the day, any partnering discussions need to make sense for long-term strategic vision of BrainStorm as a company and who we want to be. And of course, that creates the maximum value for our shareholders. We have also been very selective and prudent in capital raising, because we want the right strategic investor to invest in us. As of September 30, we have not utilized the ATM facility because we are not happy with our share price and don’t want to dilute our existing shareholders unless the prices are attractive to us.

[Chaim Lebovits:]

Next question.

[Sean Leous:]

Would management please provide further updates on the Hospital Exemption program in Israel? Have all 13 slots been filled? Are you planning to treat additional patients? Would you please share data about the progress of patients?

[Chaim Lebovits:]

Yes. So the Hospital Exemption program in Israel is proceeding very well. There’s some patients that received all three treatments. We now enrolled about 10 patients and six from Israel and four from overseas. And we’re still going to precede three additional patients, two from Israel and one from overseas. We were approached by the hospital, which indicated, that since the treatment seems to be safe and there are visible favorable outcomes. They might obtain approval for additional patients. We are consulting with regulatory advisors, if we can share certain data as we need to be very careful not to promote an investigational product. Next question.

[Sean Leous:]

Would management please provide further updates on the Phase 2 MS trials. Have all 20 slots been filled? Do you have data about the progress of patients? Is the release of top line data still scheduled for mid 2020.

[Ralph Kern:]

Thank you. Thank you for your question about the MS trial. As you know, there’s a lot of interest in this trial. And obviously this morning hearing news about the support we’re going to receive from the National MS Society is very encouraging and will help us move forward. So as of today, there are eight patients who’ve been enrolled. As Chaim mentioned, some have already received all their treatments. This is a plan 20 patient study and we have a matched natural history cohort that are being evaluated at the same top centers using the same outcome measures.So we’ll have a 5

[Chaim Lebovits:]

Thank you.

[Sean Leous:]

In discussions with the FDA, the company has submitted – has the company submitted any data from the Phase 2 or Phase 3 clinical trials as part of an application to get any other following expedited approvals, priority review or fast track?

[Chaim Lebovits:]

So as you know, the company did submitted data in the Phase 2, and NurOwn was granted fast track approval and the orphan drug designation by the FDA. Also we have orphan drug approval by the MEA. Now, we get many questions about accelerated approval, I will be broad about this. So as you know, some of the approval the agency wants to see and approved biomarker surrogate. For the time being for ALS, it’s lacking. We’re paving the way with this also, we think that we may be able to support the biomarker surrogate, and we are in discussions with agency on biomarkers. But there’s nothing yet an approved surrogate biomarker for ALS.We lately announced that the Phase 3 clinical trial for ALS fully enrolled, we were on track to release the data at the end of 2020. At this point we cannot address additional FDA strategy or discussion, so that’s – approval possibilities. What we can tell you is, that we will continue to work in tandem with the FDA every step of the way.

[Sean Leous:]

How many NurOwn treatments is Matt Bellina going to receive in total?

[Chaim Lebovits:]

Well, my dear Matt. So Matt Bellina received this treatment for free under the right to try pathway, BrainStorm will now discuss his current or future treatments. We always wish Matt and his family the very best in his fight against ALS. And as I said before, we are very conservative when it comes to not to be seen as promoting an investigational product mass treatment outside of the trial and we’re not commenting anything further about it. I know everyone sees him on social media and that’s why we’re getting many questions. But we – as I said, there’s a professional team has to be very careful when we make comments.

[Sean Leous:]

Why did the company make a poster about a surrogate biomarker from the Phase 2 ALS trial presented by Dr. Kern at the NEALS Conference? Could these data be used in an application for FDA approval of NurOwn for ALS?

[Chaim Lebovits:]

Dr. Kern, I think you should answer that question even though I touched it a little bit before.

[Ralph Kern:]

Sure. The biomarker work that we’re doing is really cutting edge and we’re paving the way in many ways in ALS, particularly looking at the CSF, which is a very good window on what’s happening in the brain. And we’re looking at a number of different biomarkers. So the three types we’re looking at are markers of inflammation. Second is a marker for neurodegeneration, in other words, damage to the nervous system. And the third type of biomarkers are those that are products that are released from the cells.What we chose to focus on at the NEALS meeting were the neuro-inflammatory biomarkers in particular one called MCP-1. While we’re very encouraged about that, I think more work needs to be done on that. And I will be speaking about that at the Motor Neuron Disease meeting in Perth, Australia. So if any of you are there, love to get more questions at that time.

[Chaim Lebovits:]

Thank you.

[Sean Leous:]

Can you update us on the competitive landscape?

[Chaim Lebovits:]

That’s occurring under the specifics we got also where people are asking to compare with Biogen’s trial for ICD-1 patient population. If you can give a little bit detail, Ralph.

[Ralph Kern:]

Yes. So while we don’t comment on other company’s products, we can make some general statements about the competitive landscape. There definitely is a increased activity in ALS as you’re aware. There are a number of early stage programs that have started looking at specific genetic targets. The most advanced genetic target I think is Biogen’s program and we’re obviously very interested in the progress being made there. When you look at the later stage ALS competitive landscape, it still is quite limited. There are only a few programs in Phase 3. When you look at the most important variable from a business perspective, which is when will the readouts happen? I think we’re well positioned to be one of the first advanced ALS programs to readout. And obviously, we hope that we bring a new treatment to the ALS community because until this date, there still is a huge unmet need. So I think that’s what I’d like to say about that.

[Chaim Lebovits:]

Thank you very much. I’ll read the next question, because it relates to myself and to you a little bit Dr. Kern. So we’ve got a few questions. People are looking at, of course, in our cash balance and they’re asking how the compensation? And for some reason the proxy was sent out to shareholders, it seems as my bonus was raised by hundreds of percent. So that’s not true. And so let me put it into context. The first I feel very comfortable to speak about Dr. Kern’s compensation.Ralph Kern has served as Senior Vice President and Head of the Worldwide Medical organization at Biogen. And Dr. Kern was highly compensated senior team member of Biogen. Biogen has of course, annual revenues of over $12 billion. And Ralph made a tough decision to leave Biogen for BrainStorm. And as we said again and again, because he’s a big believer in what we are trying to accomplish and he feels we have a very good chance of making history and changing the treatment paradigm toward the general diseases. His compensation package, I saw that he had to give up shares and option of Biogen at the time and take a smaller compensation package. Since Ralph joined us in March of 2017, he was very instrumental in advancing Phase 3 trial. His Phase 3 trials are fully enrolled. We now – he led the new indication in progressive MS, which we discussed.Ralph represented BrainStorm at numerous conferences to better explain the neuron technology platform. So for those that question his compensation, I want to say, Ralph is the ideal Chief Medical Officer for BrainStorm, the ideal Chief Operating Officer BrainStorm. And in my view, he should and we’ll earn more once the Company’s in a position to compensate Ralph appropriately. His performance is outstanding in the board’s eyes, in my eyes, so I want to put that to rest.Now there were several questions about my compensation. So I’m not going to speak about my performance. And sure, we’ll have a chance to do that within the shareholders meeting and board members will be there and they will be able to share with you how the board sees my performance. I thank the board out in full support of the board and the bonus you’ve seen there is not an annual bonus. My cash flow position is this $500 grand similarly to Ralph and he has a 30% bonus. I have 50% bonus. I had a one-time bonus of an additional $500 grand. It’s not an annual bonus. It’s based on the performance of being able to raise tens of millions of dollars for the company in a difficult time for biotech without doing follow-ons, just by activating the warrant holders and negotiated that with all the expenses for the bankers and the legal teams.So the company saved a few million dollars there and they gave me a one-time bonus for that for 2017 and 2018. Just also want to mention, I worked with this company 12 years and as President before even taking on the role of CEO from 2007 to 2015. I worked for free. Even though, I led all of the previous fundings of the company and so many additional meetings and strategy and try to picking it. I’m not even going to go in what I did for the company in last 12 years. We don’t have enough time, but I do appreciate that. The question and we are – transparency reasons, I wanted to address it. I think we can go to the next question and maybe some will want to ask additional follow-up questions, we’ll be open of course to ask us.Operator, you want to open for questions-and-answers?

[Operator:]

Absolutely. At this time, we’ll be conduct a question-and-answer session. [Operator Instructions] Our first question comes from the line of David Bautz with Zacks Small Cap Research. Please proceed with your question.

[David Bautz:]

Hey, good morning, everybody. Thanks for the update this morning. So I’m curious, when you extract cells from a patient in theory, how many injections of neurone could you give that patient? I guess, I’m thinking about obviously, you did three injections in this trial, but if this goes on to be approved, if there would be additional injections available from that first extraction?

[Ralph Kern:]

Yes. Hey, Dave. So a couple of ways to answer it. One is, what’s the potential for a number of injections, because in our manufacturing process, we cryopreserve an intermediate product. So we’re able to create three years or more of treatments for individuals who undergo a single 20-minute outpatient bone marrow aspiration to harvest the cells. So the potential for repeated treatment already exists based on the cryopreservation and our manufacturing process.Now when you look at other clinical trials for products that are approved, clinical trials only go on for six, 12, 18 months or so on. But the treatments are used in perpetuity. And there are many good examples of that. I mean, CAR-T is one good example, and as a cell therapy, and there are many other examples where sometimes people have longer or shorter periods of treatment. So I think that the medical community will determine based on the data and based on their experience and based on individual discussions with the patients they’re treating as to whether how long people will be treated. And I think that there is some other potential post-marketing study that might inform that as well. So that – I think that’s the best way to look at it.

[David Bautz:]

Okay. And when thinking about the cash position right now, what costs do you have left for the Phase 3 trial over the next year while we wait for data?

[Ralph Kern:]

Yes. So the beak of the trial cost was 2019 and in 2020 it will be going down. We don’t have an exact number to share now. We are managing our expenses quite well.

[David Bautz:]

All right, I appreciate for taking the questions.

[Operator:]

[Operator Instructions] Your next question comes from the line of Jason Kolbert with Dawson James. Please proceed with your question.

[Jason Kolbert:]

Hi guys, very exciting time. So I wonder, particularly as you start to look at MS, how you’re thinking in terms of the manufacturing process and how many hours are involved in the process now and what you’re thinking towards commercialization, so that you’ll be able to deal with all the capacity? Thank you.

[Chaim Lebovits:]

Thank you, Jason. So a few different parts of your questions. So the CMC, of course, is the same process for the ALS trial and MS trial. We are very focused now for the CMC of the ALS trial even though the same process. But we are hoping for possible approval if we’re successful in our Phase 3. But the same process would be also applicable for Phase 2 open label for progressive MS. Hope we are not looking forward to an approval only in a single open label trial there. But we do have a backup plan, if we got the BLA approval earlier than I thought. We would be able to treat immediately the first year hundreds of patients and gradually grow up to thousands of patients. As you may well know, we hired like a year ago Chief Commercial Officer, Arturo Araya, who was the former Chief Commercial Officer for the Cell and Gene department at Novartis, huge experienced and he is fully devoted for looking for these plans, how to rollout after the approval. He is happy to be with us in the room here, so hi, Arturo.

[Arturo Araya:]

Well, thank you for that question.

[Jason Kolbert:]

Well, I wonder if you guys could expand a little bit because I know during the early days we spent a lot of time looking at the complexities of the process, particularly in terms of clean room time and how do you avoid kind of the problems that our process like Dendreon’s PROVENGE ran into because cell therapy is so individualized and I understand that cryopreservation will be one of the keys, but what are some of the other keys?

[Chaim Lebovits:]

Yes. So I will go into detail on that. So as you may recall, our beginning process was 45 days almost to process our product. And now we’re down the intermediate product, 12 days only and the additional products before every injection is only seven days. And that includes the shipping. So I think it’s very close to an off-the-shelf product that an autologous treatment can get. We’re getting our costs down dramatically. And if we will solve also to be able to produce our products in closed circuit bioreactors, that will diminish the need of so many clean rooms, because we’ll be able to have someone who simultaneously product producing the same clean rooms with the closed circuit bioreactors. So we’re working for that. And I think the 2020, we’ll have quite a few interesting announcements and we’re paving the way in the CMC for the CMC of stem cell also. And Dendreon isn’t a bad example, but the good example, I’ll look at the other CAR-T product. They are viable and economical and I think that our product is simpler and easier. Ralph, you want to comment on this?

[Ralph Kern:]

Yes. Just briefly, I think, I’m handled most of that. I think, it’s not trivial that we have an interim frozen product that can be stored and we can produce in seven days for the patient – another injection for the patient. It’s a cell expansion product. So we don’t have any gene insertion or vectors or any of that involves, so it’s an order of magnitude simpler. And the truth is, we’ve been developing our technology of growing these cells and better than anybody else in the world. So although, it’s autologous, we’ve made it into as close to an allogenic kind of experience as an autologous product can be.

[Chaim Lebovits:]

Thank you.

[Jason Kolbert:]

Guys, thank you so much. Thank you for supporting me and being present at our conference. We will clearly be closely following your – as the company evolves. Thanks.

[Chaim Lebovits:]

Yes. Dr. Shah said it was a wonderful conference. He enjoyed it.

[Jason Kolbert:]

And he did a great job. Thank you.

[Preetam Shah:]

Thank you very much.

[Operator:]

[Operator Instructions] Ladies and gentlemen, we have reached the end of the question-and-answer session, and I would like to turn the call back to Chaim for closing remarks.

[Chaim Lebovits:]

One second, operator, I do want to wait another minute. In the past, we have times that the shareholders complained that they were trying to get in and the system didn’t work. I know probably it’s not the case now because we allowed like in the previous calls for our shareholders to send the questions beforehand and we address probably all of their questions. But still give it another minute to someone is maybe having a problem to do the, they’re pushing the right buttons you were asking them to. And if you want to again tell them how to ask questions one more time. Just to make sure.

[Operator:]

No problem. [Operator Instructions] Your next question comes from line of Jack Mayer with Private Investor. Please proceed with your question.

[Jack Mayer:]

Good morning. Hi, congratulations. I’m going to apologize because I missed the first few minutes of the call, but did you speak much about the hospital exemption in Israel, and if you didn’t, if you could tell us as much as you can about it?

[Chaim Lebovits:]

Yes. We did, Jack. Jack, thanks for joining us. And I know it was an early hour. We have a lot of business ongoing here and in the States. So yes, hospital exemption is going very well. We had the revenues from – I wouldn’t say revenue, but an income of $1.6 million from that program. And we think we’ll have next quarter in additional income of the same magnitude. And I also said that, hospital exemption approached us a few weeks ago that they want to approach the Ministry of Health to get approval for additional patient population. And the answer is, we would be able to provide the cells and we said that we are. So I think the hospital exemption program may go on through 2020.

[Jack Mayer:]

Okay. Have they told you how many patients they want to get permission for it?

[Chaim Lebovits:]

So the answer is yes, but we can’t disclose this. We cannot disclose at this time and results of patients. But I did say, previously on the call, that they like what they’re seeing and therefore they want to do additional patients. It’s their decision to ask for the Minister of Health for additional approval. That’s why it called hospital exemption. It’s not a sellers’ approval. It’s a little bit less than seller’s approvals on manufactured. It’s manufactured only for small amount of patients.

[Jack Mayer:]

Is there anything similar going on in any other country?

[Chaim Lebovits:]

We’re also for other companies.

[Jack Mayer:]

I’m sorry.

[Chaim Lebovits:]

This question was a…

[Jack Mayer:]

Another country, not another company, in another country?

[Chaim Lebovits:]

Yes. So I will answer. Other companies have similar products…

[Jack Mayer:]

No, Chaim, I asked you, if in any other country, in any other geography?

[Chaim Lebovits:]

I got it. I’m just saying in general, in other countries they have similar programs. If we are doing at the moment – we were approached by very big centers that they want to do it with us. I have nothing sure going forward to comment at this moment.

[Jack Mayer:]

Okay. Thank you very much.

[Chaim Lebovits:]

You’re very welcome. Have a wonderful day.

[Operator:]

[Operator Instructions]

[Chaim Lebovits:]

Okay. I guess operator, do you have anyone else?

[Operator:]

At this time, there’s no further question and I’d like to turn the call back to Chaim for closing remarks.

[Chaim Lebovits:]

So we do have – we did get an email by one of the analyst that he is trying to come on and not possible. And Jason McCarthy from Maxim, do you see him, operator?

[Operator:]

Jason McCarthy actually just queued up. So Jason McCarthy, your line is now live. Please proceed with your question.

[Jason McCarthy:]

Yes. Hi and apologies we got cutoff actually twice. So we were able to jump back in.

[Chaim Lebovits:]

I’m so happy that I was still stubborn too to ask again and again the opportunity. Thank you.

[Jason McCarthy:]

So yes, I appreciate that. Going back to the grant, I know that the funding on the CIRM grant is coming to an end and I don’t know if I missed it, is there an opportunity to possibly filed for an extension on that grant? Would they be able to increase it for funds over 2020?

[Chaim Lebovits:]

So very good question. And thank you for asking that, because probably others have the same question. So we still have part of the grant was not yet given and we will be given a big part of the grant in 2020 close to $4 million. So that’s one answer. And also we do have other grants in the pipeline as from the other organizations.

[Jason McCarthy:]

Okay, perfect. And also if you could discuss just a little bit around manufacturing. The cryopreservation is in place, right? So when you start to think about the data readout that’s coming next year, one of the company is planned to ramp up a manufacturing or position the company for potential commercial launch, which we estimate could come as soon as 2021.

[Chaim Lebovits:]

Okay. It’s a very good question and I really see that you were cutoff the call because your colleague Jason asked that similar question. But let me give you the answer, Jason.

[Jason McCarthy:]

That’s surprising. Thank you. Thank you.

[Chaim Lebovits:]

So the answer is that we – as you know, we hired senior management member, Arturo Araya, who came from Novartis and that was his job there too to make sure that when a BLA happens they’re ready to produce. And so we do have a backup plan. Even if we get a BLA today, we would be ready to produce it. We’re following the pathways of different CAR-T companies, what they have done, but they didn’t have their own facilities yet ready. And we’re also talking to partnership opportunities with a quite a few of the big manufacturers, all of there, with all going to get into names. So we would be ready even as I said, BLA today to treat hundreds of patients this year and gradually draw off and the second is earlier to thousands of patients. The outside of the – as I mentioned, we cryopreserve that to intermediate product.We may be able to cryopreserve even the final product. But even if not, what we are able to do is, we are very close to find a solution of producing our product in the bioreactor – closed circuit bioreactors. So rather than being able to do one or two proximate in the same clean room, we’ll be able to just put in 30,40 bioreactors in the same room and that was 30, 40 products in the same clean room, and that will bring down the cost to 30%, 40% that we believe. And I think for products in the cell and gene therapy space is the price is becoming a very big issue and in my view, once and if NurOwn would be approved by BLA, we will not be in the headlines of the high end prices. We’re getting our costs down. We’re very happy where it is today.

[Jason McCarthy:]

Okay, great. Thank you for taking the question.

[Chaim Lebovits:]

You’re very, very welcome. Operator, so one more time maybe, who knows, who else was cutoff?

[Operator:]

Absolutely. [Operator Instructions]

[Chaim Lebovits:]

Operator, we tried three times. I think we did our part. So thank you very, very much for handling this call and thank you for being so patient with us with Q&A. And I want to thank everyone for being on this call. We’re looking forward for our next call. We are very, very positive on where we are standing. We’re really, really appreciate the shareholders’ support and the Q&A with attend beforehand. It happens technically that even in today’s age, people got – get cutoff by mistake. But this is a very well company that is handling our call and we appreciated their support. And we’re looking for a very successful 2020 and very successful shareholders meeting beforehand. Thank you very much for joining today and have a wonderful day. Thank you very much.

[Operator:]

Ladies and gentlemen, this concludes today’s conference. You may disconnect your lines at this time. And thank you for your participation.