Onconova Therapeutics, Inc.
Q4 2020 Earnings Call Transcript

Published: 11 Mar 2021

[Operator:]

Ladies and gentlemen, thank you for standing by. Welcome to the Onconova Therapeutics 2020 Financial Results and Business Update Conference call. At this time, all participants are in a listen-only mode. Following management’s prepared remarks we will hold an question and answer session. As a reminder, this call is being recorded today, March 11, 2021. At this time, I would like to turn the call over to Avi Oler, Senior Vice President of Corporate Development and General Counsel. Sir, the floor is yours.

[Avi Oler:]

Thank you, operator. Good afternoon, everyone, and welcome to Onconova's 2020 financial results and business update conference call. Earlier this afternoon, we issued a press release reporting our 2020 financial results and business progress. If you have not seen this press release, it is available in the investors and media section of our website at www.onconova.com.

[Steve Fruchtman:]

Thank you, Avi. Good afternoon, everyone, and thank you for joining us. We continue to hope you, your colleagues and your loved ones are safe and healthy. We are living in amazing times, witnessing the power of nature and the dramatic influence key scientific discoveries can have to help human kind, a truly extraordinary year. Before I discuss the progress to enter the clinic, we are making and advancing our multi-kinase inhibitor, ON 123300, which I will refer to as ON 123. I want to thank our stockholders for your tremendous support of Onconova over the years. I also want to ask our stockholders a record as of January 12 that have not yet voted to vote today in Onconova's stockholders' meeting. The Board of Directors firmly believes that the stockholder proposals to change our capital structure by a reverse stock split in the best interest of stockholders. Turning out the vote is imperative for the company to execute its strategic plan from a strengthened position. We believe the approval of these proposals will

[Mark Guerin:]

Thanks, Steve, and good afternoon, everyone. I'll start with the review of our 2020 expenses, and then I'll discuss our cash position and cash runway. Research and development expenses for 2020 were $16.9 million, and this compares with $15.5 million for 2019. The increase was primarily related to higher regulatory consulting expenses and manufacturing costs related to clinical supply of ON 123, partially offset by lower expenses for the oral rigosertib's combination program and the Phase III INSPIRE study in the 2020 period. General and administrative expenses for 2020 were $8.3 million, consistent with 2019. Lower personnel and stock compensation expenses in 2020 due to personnel reductions in the 2019 period were offset by higher pre-commercialization, insurance and corporate legal and stockholder meeting expenses in the 2020 period. Net loss for 2020 was $25.2 million or $0.14 per share on 174 million weighted average shares outstanding, and this compares with a loss of $21.5 million or $1.49 per share for 2019 on 14.4 million weighted shares outstanding. Cash and cash equivalents as of December 31, 2020, were $19 million compared with $22.7 million as of December 31, 2019. After the end of the year, we raised net proceeds of $35.2 million from 2 equity offerings with institutional investors. Since September 30, 2020, approximately 3.7 million warrants have been exercised, resulting in proceeds of $0.7 million. As a result, our cash and cash equivalents on February 28, 2021, were approximately $49.5 million. We believe that this cash position will be sufficient to fund our ongoing trials and business operations for more than 18 months and through the achievement of significant milestones, including pursuing corporate development opportunities. This completes my financial review. I'll now turn the call back to Steve.

[Steve Fruchtman:]

Thank you, Mark. We are very excited about our development plans for ON 123 and oral rigosertib and believe we have a very strong financial position. We urge our stockholders who have not voted to please vote today in anticipation of the special meeting. We'd now like to open the call for questions. Operator?

[Operator:]

Our question comes from the line of Joe Pantginis. Sir , please go ahead. Your line is open.

[Unidentified Analyst:]

Great. This is on for Joe Pantginis. Thanks for taking the couple of questions. First, can you remind us of your cell line resistance studies using ON 123 and the benefits that you saw?

[Steve Fruchtman:]

Sure. And thank you for that. Steve -- Dr. Cosenza, who's on the phone, did most of those studies. Steve, would you like to take the question?

[Steve Cosenza:]

Sure. Thank you for that question. This is Steve Cosenza. The -- I believe you are referring to the resistance cell lines that are resistant to palbociclib. And these cell lines were resistant due to a deficiency in the RB pathway, either by being no, meaning they're not expressing RB or they are mutated in that pathway. And therefore, these pathways are not required for cell division. The main target of the approved CDK4/6 inhibitors, such as palbociclib and ribociclib and to some extent, abemaciclib, require or a functional RB pathway for these compounds to be active in these tumor cells. Our compound since is a multi-kinase inhibitor were found to -- the cells who were found to be similarly sensitive to these -- to ON 123, 123300 as RB proficient cells.

[Unidentified Analyst:]

Great. That's much appreciated. Second question for you guys. I know you kind of mentioned this in the presentation, but can you provide any more detail on when you might think that we could see some of the long data with rigosertib this year?

[Steve Fruchtman:]

So again, thank you for that question. So you're asking about the combination lung cancer trial, KRAS-mutated lung cancer trial in advanced KRAS-mutated patients. So the dose of rigosertib has already reached the highest level of rigosertib that we've given in the current scheme in combination with full dose nivolumab. We will determine based on whether or not those limiting toxicities are observed, if we've already established the recommended Phase II dose of the doublet if we have not seen additional dose-limiting toxicities, we may elect to continue to dose escalate rigosertib. In either scenario, we anticipate having the recommended Phase II dose of the doublet before the end of the year.

[Unidentified Analyst:]

Great. Fantastic, also very helpful. One more question before I let you guys go, also related to time line. When do you think you can see some data from the squamous cell carcinoma data that's associated with RDEB patients?

[Steve Fruchtman:]

Again, thank you for your question. That's a more difficult question to answer. So these are very rare squamous cell cancers because they are driven by genomic abnormalities of RAS. So these patients are few and far between. It is an international study in both Europe and the U.S., but it's very hard in rare indications to determine when we will have the clinical data. So I'm going to basically answer, I do not know it's going to be dependent on how offering, how frequent these patients can be identified, but we are working with centers that have great expertise in this very rare RAS-driven squamous cell carcinoma of the skin.

[Operator:]

I'm showing no further questions in the queue at this time. I'd like to turn the call back to Mr. Steve Fruchtman for any closing remarks.

[Steve Fruchtman:]

Well, thank you all for participating on today's update call. To reiterate, we have several near-term milestones and value drivers ahead of us. The first, we plan to commence patient enrollment in the second quarter of 2021 for a U.S. Phase I trial with ON 123 in advanced advances. Including metastatic breast cancer patients refractory to approved CDK4/6 inhibitors. We expect to have the recommended Phase II dose for ON 123 by the first half of 2022. Two, the pipeline of investigated sponsored studies with oral rigosertib is advancing and further progress is anticipated in 2021, including establishing a dose of further study of the combination of oral rigosertib and nivolumab in KRAS-mutated non-small cell lung cancer and other solid tumor RAS-driven cancers by the end of the year. Three, we are actively evaluating strategic opportunities to enhance our product portfolio driven by science and the potential for clinical benefit for patients, hopefully, before the end of the year. Four, and again, as an important reminder, please take action today and vote for the proposals in the special meeting of stockholders. We greatly appreciate your continued interest in the programs of Onconova. Should you have any additional questions, please feel free to contact us. Thank you, again, stay safe, and have a nice evening.

[Operator:]

Ladies and gentlemen, thank you for your participation in today's conference call. This concludes today's event. You may now disconnect.