Brainstorm Cell Therapeutics Inc.
Q3 2017 Earnings Call Transcript

Published: 17 Oct 2017

[Operator:]

Good day everyone and welcome to the BrainStorm Cell Therapeutics' Third Quarter 2017 Earnings Call. Just a reminder today’s call is being recorded. And at this time, it’s my pleasure to turn the conference over to Paul [indiscernible]. Please go ahead sir.

[Unidentified Company Representative:]

Thank you, Laurie, and good morning everyone and thank you for participating in today's third quarter conference call for BrainStorm Cell Therapeutics. Leading the call today will be CEO, Chaim Lebovits; as well as Dr. Ralph Kern, Chief Medical and Chief Operating Officer. A press release with the company's third quarter financial results became available this morning, Tuesday, October 17, and can be found on the Investors Page of the company's website. Before we begin, I'd like to remind everyone that various remarks about future expectations, plans, and prospects constitute forward-looking statements for the purposes of the Safe Harbor Provisions under the Private Securities Litigation Reform Act of 1995. BrainStorm cautions that these forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those indicated. Any forward-looking statements made on this conference call speak only as of today's date Tuesday, October 17, 2017, and the company does not intend to update any of these forward-looking statements to reflect events or circumstances that occur after today's date. As a reminder, this conference call is being recorded and it will be available for audio replay on the company's website at www.brainstorm-cell.com. As the operator mentioned, all participants are currently in a listen-only mode and there will be brief Q&A session following today’s prepared remarks. With that, I'd now like to turn the call over to CEO of BrainStorm, Chaim Lebovits. Please go ahead sir.

[Chaim Lebovits:]

Thank you very much Paul and thanks Laurie for the nice introduction. Hello to all shareholders on the line with us. These are very exciting times here at BrainStorm with all the activity in the run in period to kick of Phase 3. Patients are now enrolled after a successful tech transfer, which was approved by the FDA and that allowed us to move on to treat patients. As you can see my voice is a little bit sore, so I will hand this over immediately to Dr. Kern, who can probably do a better introduction than me to the call and we wanted anyways to keep it as short as possible. We want to take questions from those that want to ask. So, Dr. Ralph Kern, our Chief Medical Officer, Chief Operating Officer, please. Sorry for my voice.

[Ralph Kern:]

Thanks Chaim and hello everyone who has taken the time to dial-in. Yes, these are really exciting times as you saw in today’s press release there are a number of huge inflection points for us as a company beginning in Phase 3. Chaim mentioned the successfully technology transferring, our platform therapy at the Phase 3 level is a huge achievement for our entire company and all the folks who are working on it for us, we are very proud of the team. The first patients have been enrolled in the study and we’re also really pleased about the support that we’ve received from CIRM, California stem cell agency to provide funding for this important project. We are working with the top leading ALS centers in the United States. We have a lot of confidence and appreciate the support that we get from our principal investigators, and we are hoping to confirm the promising efficacy that we’ve seen in Phase 2 in a very well designed and carefully executed Phase 3 program. We hope to see data in 2019. And at this point, I would like to turn it over for questions. Thank you.

[Chaim Lebovits:]

Alright. Laurie?

[Operator:]

[Operator Instructions] And we will go first to Jason Kolbert with Maxim Group.

[Jason Kolbert:]

Good morning guys, congratulations on all the progress. Can you just share with us a little bit about what the dynamic was like to enroll the first patient? And based on the end of Phase II meeting with the FDA and the number of sites that you are using and the demand, can you give us some idea of kind of how you are gearing up to handle enrollment and what the enrollment velocity might look like? Thanks.

[Chaim Lebovits:]

Thank you very much Jason. I’ll give you the answer for this one. Well we had more correspondence with the FDA and we really want to thank them, they are very available to us and very supportive of the whole process, and yes they were of course stricter than the Phase 2 for the tech transfer results, but as you know we have a very good CMC team, probably second to none when it comes to stem cells. And we made it in the first three try runs all three were successful, satisfactory to the agency. So that was a very big and important milestone internally, not something we announced, but was very important for us to be through that. Now MGH and UC Irvine are the first two sites that IRB already approved, but all have a comment [ph] along, I believe by January all six sites will be in enrolling patients and City of Hope will be at [indiscernible] producing NurOwn. So that’s the dynamics. We have a second coordinator coordinating between the sites who is first, because the pressure is starting, which patients are being dealt when, as you it is a personal cell therapy, so there is a bottleneck of the production, but I think we have it wrapped around very well. City of Hope is a very good centre and very good team and we work in a very close atmosphere in a very trustworthy way and in open manner. So we're very happy of how it’s proceeding, we just hope that it should proceed like this or better through the trial, and maybe Ralph you want to add something.

[Ralph Kern:]

Yes Jason thanks for the question. Yes, the demand for the study is very, very high and really all the sites that we have worked closely with have made all the necessary arrangements. As you know, three of the six sites are veterans because they’re in the Phase 2 program, so there is three new sites in California and we’ve been very pleased that how quickly they’ve adopted all the necessary internal steps to be able to obtain the bone marrow harvested [ph] send it off and then be able to set up the injection procedures. So we’re very confident that the demand is there. The manufacturing is very robust and predictable and we have a lot of confidence in City of Hope and we also have had very good site initiation visits with all the sites. We’ve had great training. We believe this will be a state-of-the-art ALS trial. So, we’re really looking forward to getting to the finish line as quickly as possible, obviously.

[Jason Kolbert:]

Guys two more questions that are kind of relevant; one is, congratulations on pulling down a significant amount of capital from the CIRM grant already, can you just walk me through the rest of the process and how you realize that capital? And then my God, if this trial was successful at the end, tell me a little bit about how you work to prepare capacity because it seems to me that demand is going to dramatically exceed supply, so how will you be able to get, you know what will the regulatory requirements be for approval and because regulators are going to anticipate demand and they want to understand what the manufacturing process is going to look like? Two very different questions, but I think the easy one is CIRM.

[Chaim Lebovits:]

Yes. So, I will cover the easy one, just a short comment on the hard one, Ralph will continue more details on that. So first of all, we - on CIRM, CIRM is already giving us almost 30% of the ground $5.5 million and we have a few milestones to meet. We already met the next milestone, which I’m not going to detail on the phone call. We have very good rapport with them, they are very supportive, they are working very closely with us. I want to remind you that three centers are in California. All three centers are aligned with CIRM, CIRM some of them even more with Alpha Clinics. So it’s a very good partnership and we may even partner with them as some of their indications, we are not ready to talk about it now. So that’s wonderful. Now when you talk about the manufacturing with the regulation, I think that we have a very good team in the agency from CBR [ph] that really understands stem cell therapy and they are very involved to every detail of the manufacturing process and we are on the same page. So that’s very important. We don't foresee this to be an issue after getting an approval. Now what would be the endpoint. They did say we mentioned that in the past that if we replicate what we have seen as a subgroup of Phase 2 that that will be something very good to be seen and that’s what we are trying to do, but I will let Dr. Kern answer the harder question in more detail.

[Ralph Kern:]

Okay, well thanks for the tough question. I hope I can do it justice. Yes, I think we are thinking about it in three ways. I mean the first step obviously is getting an approval. So the BLA submission is top of mind for us. We are very - first of all we’re very fortunate to have a great working relationship with CBR and as Chaim said, we had - almost continuous dialogue with them and they’re very good at giving us advice, sometimes too much advice, but we take it with a grain of salt. The second piece, so I think the first part is quite - we're quite comfortable with the course that we’re on. The second day is obviously the manufacturing capacity planning and we’re very actively doing that both in terms of our technology platform and also in terms of developing additional capacity so that we can deliver at lower cost than what’s needed more efficiently. And finally we’re very actively thinking about the value proportion of our treatment. At the end of the day it’s the value that will drive with the adoption of the product and the use and we think that because we have taken a very high bar in the study, in terms of the endpoints we think that if we are able to meet this endpoint that we will have a very strong demand for our product and I think it will work out. So thanks for that question.

[Jason Kolbert:]

Congratulations.

[Chaim Lebovits:]

Thank you. Dr. Kern is really preparing the commercialization plan for the last few months already. We will talk about that in another time. Next question please. Thank you, Jason. Next question please.

[Operator:]

And we will go to David Bautz at Zacks Investment Research.

[David Bautz:]

Hi good morning guys. Thanks for taking the question. I just want to talk a little bit more about the demand, you said that there is high demand for patients that get into the trial, I’m just wondering, do you have physicians calling you up and advocating for certain patients, do you anticipate perhaps the demand that’s going to outpace the availability in the Phase 3 and then are there any plans to maybe move those patients into a compassion that use protocol outside of the Phase 3 here in the US?

[Chaim Lebovits:]

Thank you so much David. Having advocating physicians on a daily basis, not only for patients they are first of all advocating to be sites. We have on a daily basis very good campus [ph] that want to be sites for this trial. As very promising [indiscernible] approved and we are excluding NurOwn, but still patients who want to be in the trial of the demand is so high, even though I am reminding you that 50% of the patients would be treated, another 50% are placebo. And yes they are also advocating for patients, but they know that our PI in the states are KOLs in the field and they are all premeditated that we don’t have a Capacities program for the moment. It has many negative implications on a professional trial to be held. So we are focused to really try to get this through a successful Phase 3. That’s what’s our main focus is, maybe Ralph wants to add something to it?

[Ralph Kern:]

Yes David, how are you doing? The only thing I will add is, as is the case for any non-clinical trial program whether it’s compassionate or expanded access, we don't want - the number one principle is to not put the clinical trial at risk. Second principle is not to put any regulatory approval at risk because we think that getting the study done, getting a BLA approval can contribute most to the ALS communities, so that’s our number one priority. And we’re going to stick with that plan. So we don't want to do anything that would put at jeopardy the successful completion of the Phase 3 program.

[David Bautz:]

All right, thanks for the taking the question, congrats on the progress.

[Chaim Lebovits:]

Thank you.

[Ralph Kern:]

Thank you.

[Operator:]

And gentlemen I have no further questions at this time, I’ll turn the program back over to you for any additional or concluding remarks.

[Chaim Lebovits:]

This is quite a surprise, less questions. We see quite a few people on the line. So maybe it means that the message is getting across. Finally, people do understand where we are. So I will let you all go and thank you very much for listening in, and hopefully in the next quarter we will have additional good news to share with you. Thank you very much.

[Operator:]

And ladies and gentlemen once again that does conclude today's conference and I’d like to thank everyone for joining us today.