Vascular Biogenics Ltd.
Q1 2021 Earnings Call Transcript

Published: 11 May 2021

[Lee Roth:]

Thank you, Sheryl. Good morning, and thank you joining today’s VBL Therapeutics First Quarter 2021 Financial Results and Corporate Update Conference Call. Leading the call this morning will be Prof. Dror Harats, Chief Executive Officer; and Amos Ron, Chief Financial Officer. A press release with the company’s financial results was issued earlier this morning and as available on the Investor Relations page of the company’s website at vblrx.com. Before I turn call over to management, I’d like to remind everyone that during this conference call forward-looking statements made by management are intended to fall within the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, and Section 21E of the Securities Exchange Act of 1934, as amended. As set forth in our press release forward-looking statements, involve risks and uncertainties that may affect the company’s business and prospects, including those discussed in our filings with the SEC, which include among other things our Annual Report on Form 20-F. These filings are available from the SEC or on our website. Any forward looking statements made on today’s conference call speak only as of today’s date May 11, 2021, 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.

[Dror Harats:]

Thank you, Lee, and good morning, everyone. Joining me on today’s call is Amos Ron, our Chief Financial Officer, who will discuss the first quarter financial results for 2021. I’m pleased to say that it has been another productive quarter for VBL with continued progress for our lead program VB-111, our novel gene-therapy for solid tumors. We continue to be encouraged by the ongoing progress with our Phase 3 OVAL pivotal trial in ovarian cancer, which if successful, has a potential to reshape cancer therapeutics and to establish a new standard of care in challenging disease setting, where patients currently have limited options. In today’s call, I would like to focus on two significant points. The first of which is the progress of the OVAL trial towards potential BLA. And the second is VBL’s cash position as we prepare for the success and hopefully for commercialization of VB-111. Starting with OVAL study, as a reminder of OVAL is an international placebo-controlled double-blind Phase 3 registration enabling study in recurrent platinum resistant ovarian cancer. Today, we have had three successful DSMC reviews of this study. The most recent of which was in February. Following the review, looking at 200 patients, the DSMC again gave us the green light to proceed as planned. Enrollment in the OVAL is going very well and is now two-third through, as we continue to advance a study, we look forward to the next DSMC view in the third quarter of this year, and they’re achieving a full enrollment at the end of this year. We remain encouraged by the high response rate in the total blended dataset, as well as by the safety profile of the study population and intend to provide an update on the OVAL trial at the upcoming ASCO conference in June. We’re excited to advance VB-111 for the potential benefit of ovarian cancer patients and would like to thank all the patients and their families as well as investigators, healthcare professionals, who are taking part in this important international study. As for the financial state of the company, we’re pleased to announce in mid-April that we closed a straightforward public offering at market price to raise $28.3 million from existing shareholders, as well as institutional funds from the U.S. and Israel. Together with an additional $12.3 million that was injected into the company during the first quarter, mostly through the exercising of warrants that were issued in 2020. Our cash position is now over $60 million. This is expected to fund the company until year end 2023 through many milestones and most importantly, the readout from the OVAL study and potential BLA submission for VB-111 in ovarian cancer. We appreciate the continued support from our investors and look forward to rewarding their confidence in us, as we continue to execute on our key strategic objectives.

[Amos Ron:]

Thank you, Dror. Good morning, everyone. As of March 31, 2021, we had cash, cash equivalents, short-term bank deposits and restricted bank deposits, totaling $36.6 million and working capital of $30.7 million. As Dror mentioned, in early Q2, we completed the public offering of common stock and pre-funded warrants, which is rated gross proceeds of approximately $28.3 million. For those unfamiliar, with the term pre-funded warrants, our class of securities that allow investors that have restrictions on the ability to own company’s stock above a designated ownership threshold to invest additional capital. In practice, the pre-funded warrants are the equivalent to ordinary shares without voting rights. We expect that our cash and cash equivalents and short-term bank deposits will be sufficient to find operating expenses and capital expenditure requirements until year end 2023. Revenues for the first quarter were $185,000 is compared to $366,000 for the comparable period in 2020. Research and development expenses net was $4.8 million for the quarter compared to $4.5 million in the same period in 2020. General and administrative expense was about $1.7 million for the quarter compared to $1.3 million in the same period in 2020. And finally comprehensive loss for the first quarter was $6.3 million or $0.12 per share compared to $5.4 million or $0.15 per share last year. With that, I will return the call back to the operator for the Q&A portion of this morning call.

[Operator:]

Thank you. Our first question is from Kevin DeGeeter with Oppenheimer. Please proceed.

[Kevin DeGeeter:]

Hey, thanks for taking my questions guys. Maybe just two quick ones on OVAL and then I have a follow up. Dror, can you just comment a bit about, at least the general scope of the updated ASCO in early June and then with regard to enrollment you are perfect to hear continued success therapy. Can you talk a little bit about, geographic enrollment specifically certain geographies where you hope to be able to make some incremental enrollment in the Phase 3 to support future regulatory and commercial uptake then on the top.

[Dror Harats:]

So Kevin, thank you for the questions. As you can get, we always a bit limited about what we can say about what we’re going to show at ASCO meeting. The abstract of the ASCO meetings are going to be public in May 19. And there is a lot of you know sometimes the abstract itself is actually quite dull and not giving a lot of information, but the driving progress poster that we are going to present at the ASCO, going to as meaningful a news about the study. And they all should be tuned to the ASCO meeting where we will be able to talk more about the trial that we are running right now, the OVAL trial. As regard to geographic enrollment, as the major part of the centers are in the U.S. and that’s most important markets that we are looking for, but actually recruitment is going very well, both in Europe, in U.S. and in Israel and all of that in spite of the COVID-19 and the COVID-19 is quite was – quite tough in Europe in the last three or four months, nevertheless, we are recruiting very well. And actually we are over two-thirds of the patients. So, we are really on track to get to where we want to be by year-end. Regarding, the Japan market, and I guess you are talking about it is well. We have some centers open right now, but we will announce when we have a first patient randomized. And I have to remind everybody that this is gene-therapy based technology and our experience at, it always take time to stop the studies in centers, but then when it stops, it goes very well. So, we expect to see some patients in Japan as well in the near future.

[Kevin DeGeeter:]

Great. And then my up follow-up question is on colorectal, I think we were looking for an update, later this year any update on the progress of that study?

[Dror Harats:]

So, first let me take the opportunity to say, a couple of things about the other trials beside the OVAL trial that we are running with VB-111. The GBM trial is actually going well. We are opening centers, recruiting patients and things going according to plan. And when we will have more information, we will, of course, talk about it. Regarding the colorectal study, it’s going very well. It has done with a National Cancer Institute as you know. In this trial, the major thing we are looking for is actually to see if indeed where the viral product, you can bring the immune system into the gut in a similar way that we can bring it to other organs. In human being, we have evidence that we are bringing it quite significantly in ovarian cancer. In animal models, we had a lot of information about the other organs, including, lung, liver and other and we know that we bring the immune system there. The major question of course, is the gut, because the gut is completely work differently in the immune system. And as we all know, there are bugs and viruses in our gut. Normally, and the question is, of course, if viruses can bring the immune system into tumor in the gut. We are expecting to have these data later on this year, it all depends, and not really just on recruitment, there is a decision then when we will get to enough, a biopsy specimens that we can say meaningful things about this question. Then the people at the NCI going to actually look at all the slides and see if they can show indeed that the immune system actually can be changed in tumors in the gut. So, I would actually expect to see results in the next three to six months.

[Kevin DeGeeter:]

Thank you for the update.

[Dror Harats:]

Thank you, Kevin.

[Operator:]

Our next question is from Arthur He with H.C. Wainwright. Please proceed.

[Arthur He:]

Hi everyone. Thanks for taking my question. This is Arthur for RK. So just to follow-up on the COVID-19 study, I just wonder when could we expect the data updated from the study. I know you about two-third patient enroll, if it could you give us some color on that part?

[Dror Harats:]

So, let me – thank you, Arthur, for asking the question. Let me make it completely clear about how we view the COVID-19 story. So, what I meant is that with the VB-111, our gene-therapy, we are over two-third recruited, regardless of the story that it’s difficult to recruit in the COVID-19. Our program in COVID-19 with two, one is actually completely different. And I’ll explain how and why. The COVID-19 pandemic is actually a major problem globally, but vaccination is working extremely well. And in the pipeline, there are antiviral therapies. So, well CA or VB-201 our drop that working on monocytes that can help in the pneumonia that you have in COVID-19. I believe that this type of drugs are actually not going to be very helpful in the future, especially that we will have antiviral, specific drugs and the vaccines that actually work extremely well, more than expected. And the immunity stayed for quite significant time. And it’s good so far for a most of the mutated viruses that has been tested. So, we started this trial in Israel. Right now, we don’t have that many patients Israel almost none, and we’re not going to actually extend it outside of the country, because we believe that this is an effort to distract us from the main programs that we have at VBL. And actually by the time that this study can be done, we believe that the issues will be completely different. Would that compound has a role in other viral infection where there is chronic inflammatory disease, it’s remained to be seen, and we might have a collaboration on that with some major medical centers, but when that will be irrelevant, we will actually talk about it.

[Arthur He:]

Thank you for the clarification. Then my second question is regarding the MOSPD2 program could you give us any update on the VB-601 the process? Thanks.

[Dror Harats:]

So actually thank you for asking this question. I didn’t mention that, because I wanted to mention mainly the news that we have in the company right now. But VB-601 program is going very well. And according to plan, and we are actually finishing the IND-enabling studies, including toxicology, when we will have the report, we will announce it. But so far, the drug seems to be very safe and we will discuss it later on this year. We’re now in the middle of production of the batch for the clinical trial and we expect to see first in men in the beginning of 2022.

[Arthur He:]

Thank you for taking my question.

[Operator:]

There are no further questions at this time. I would like to turn the conference back over to Prof. Harats for closing comments.

[Dror Harats:]

So thank you all for joining us this morning on our financial call. Thank you. And have a good day.