Vascular Biogenics Ltd.
Q2 2016 Earnings Call Transcript

Published: 15 Aug 2016

[Operator:]

Good day and welcome to the VBL Therapeutics Second Quarter 2016 Financial Results Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Mr. Paul Arndt, Managing Director of LifeSci Advisors. Please go ahead.

[Paul Arndt:]

Thank you operator and thank you all for participating in today’s second quarter 2016 financial results and corporate update conference call. Leading the call today will be Dror Harats, CEO of VBL Therapeutics and Amos Ron, VBL’s Chief Financial Officer. A press release with the company’s second quarter financial results became available at 7

[Dror Harats:]

Thank you, Paul and good morning to everyone joining us on our call. We appreciate the opportunity to review our second quarter operating performance and the progress we have made advancing our clinical and corporate programs. Among the significant milestones, we achieved during the second quarter, we are both at significant positive clinical data on our later appointing candidate VB-111 in two oncology indications ovarian cancer and recurrent GBM. We continue to move forward with our ongoing Phase III GLOBE study investigating VB-111 in recurrent GBM and we close successful public stock offering that gives us the financial flexibility to continue our aggressive corporate and clinical strategies into 2019. As you can see, we have a lot to cover. So let me begin by updating you on VB-111. The clinical highlight of our quarter was I think you will agree the positive Phase II results, we presented in patients with recurrent platinum-resistant ovarian cancers. This data were presented at the ASCO conference and we also discussed them in details during an Analyst Meeting that was held concurrent with ASCO. As a reminder, VB-111is a first-in-class targeted anti-cancer gene therapy agent that we are exploring [indiscernible] wide range of solid tumors. The dual mechanism of VB-111 targeting of tumor vasculature with an anti-tumor immune response, retains activity regardless of baseline tumor mutations or the identity of the pro-angiogenic factors secreted by the tumor. This drug candidate has obtained fast track and Orphan drug designation, and our GLOBE pivotal trial in the recurrent [GPA] (Ph) is being conducted under an FDA special protocol assessment. The primary objective of this ovarian cancer trial were to evaluate the safety and tolerability and identify the dose limiting toxicity in combination of VB-111 and weekly paclitaxel and to explore the efficacy in an extended cohorts of the optimal treatment regimen of VB-111 and weekly paclitaxel. 21 patients with record platinum resistant ovarian cancer were enrolled at Massachusetts General Hospital in Dana/Farbar Cancer Institute to receive up to seven doses of treatment. Patients were treated on two consecutive cohorts, a low dose cohort of [3X1012] (Ph) viral particles and 40 or 80 milligram paclitaxel with essentially served as a control or of their appointed dose cohort or [1X1013] (Ph) viral particles and 80 milligram paclitaxel. The data we present demonstrated a statistical significant increase in overall survival of VB-111 with [median] (Ph) overall survival of 810 days in the VB-111 therapeutic dose versus 172 days in the low dose. Moreover, nine of the 15 valuable patient or 60% on the therapeutic dose has durable, GCIG criteria responses as defined by a 50% reduction in the CA-125 biomarker. Durable resist responses and disease stabilization were also seen. This response data compares very well with historical controls. Looking at chemotherapy alone, you would only expect to see about 11% response rate, and with Avastin plus chemotherapy, you would expect a 32% response rate. So the response rate we achieved was approximately double that of the current Standard-of-Care. Additionally, we observed an immunotherapeutic effect in biopsies taking from patients. Specifically, H&E and immunohistochemistry stating showed infiltration of cytotoxic CD8 T-cells leading to regions of apoptotic cancer cell following treatment with VB-111. VB-111 was found to be safe and well tolerated. Toxicity was similar to what you would expect with [indiscernible] in these patient population and no dose limiting toxicities were reported at any dose level. The data are particularly impressive given this drive focused on patient with full prognosis disease. 48% of the patients were primary platinum-resistant or refractory patients. They are subjects that never really responds to platinum chemotherapy. Additionally, 52% of the patient had tumors and had failed respond to prior anti-angiogenic agents including Avastin. Practically, most patients in Phase II trials has a better prognosis making this already a late trial. So while we design the trial primarily to look at safety, we were happy to see such significant efficacy. The second set of data to come out at the ASCO was a meta-analysis comparing clinical outcome with VB-111 with full data from eight different historical studies that investigated Avastin in recurrent glioblastoma. The analysis showed that median overall survival for patient in our Phase II trial, who has received a continuous exposure dose of VB-111 was 59 weeks compared with 32 weeks in the historical pooled Avastin trial. 12 months overall survival was 57% in patients on continuous exposure of VB-111, who were treated through progression compared with 24% in historical pooled Avastin trial with a P value of 0.03. As you know, we are currently enrolling patient in a pivotal Phase III registration study with VB-111 in recurrent GBM. I’m pleased to say that this ongoing study known as the GLOBE study is proceeding well and recruiting patient on schedule at center in the U.S., Canada, and Israel. It is designed to compare VB-111 in combination with Avastin to Avastin alone with a recruitment target of about 252 patients. The study is proceeding under special protocol assessment or SPA that we negotiated with SPA. As we have said, we plan to conduct an event driven interim analysis in the GLOBE according to the study protocol. While the timing of functionalities depend on the enrollment and VB-111 activity, our expectation is that we will conduct it in the first half of 2017. Full trial results are expected in early 2018. In regards to VB-111 in patients with GBM we agreed with FDA on an access program, which we will initiate in due time. We continue to receive unsolicited interest from patients and we would like to accommodate them in a way that does not jeopardize our GLOBE registration trial. And of course, drug development is a capital intensive undertaking, so we took advantage of this very positive data at ASCO to raise an additional about 22 million net without warrant through a registered direct offering with institutional investor. We are very grateful for the confidential support of our investors and now have that financial flexibility to fund our programs into 2019 including finishing the ongoing recurrent GBM trial and the potential registration ovarian trial. At the end of June, I was pleased to announce that Dr. Rachel Humphrey joined us as the Head of our Scientific Advisory Board. She is currently the Chief Medical Officer of CytomX and previously was Senior Vice President and Head of Immune Oncology at AstraZeneca and also held senior position at both Bristol Myers and Bayer. Her track record of success in managing product development from pre-IND stage to commercialization will be invaluable as we continue to advance VB-111 and other product candidate through the clinic. Looking to the second half of the year, we are now preparing for an end of Phase II meeting with the FDA to discuss next step with VB-111 in ovarian cancer. Based on the recent positive data at ASCO, we hope that the next study in this disease setting will be a potential registration trial. The other important milestones, we expect in the second half of 2016 will be further data from our ongoing exploratory Phase II trial with VB-111 in thyroid cancer. This open label dose escalating trial study is designed to assess the safety and efficacy of single or multiple dose of VB-111 in patient with advanced recently progressive differentiated thyroid concern that is unresponsive to radioactive iodine. You will recall that in December of 2014, we announced data showing that 35% of patient in the therapeutics dose cohort of this trial met of primary endpoint of six months progression free-survival, compared with 25% in the low-dose cohorts. Since then, we continue to follow the patient and we shall provide a full Phase II report including overall survival data by the year-end. So, our VB-111 continues to generate very promising data and is moving forward. We are well financed and we have strengthened our advisory board. Again, almost every measure of our second quarter was positive and I look forward to continuing to report to you as we move our program closer to the market. Now, I would like to turn the call over to Amos Ron, our Chief Financial Officer, who will give you more details about our financial results. Amos.

[Amos Ron:]

Thank you Dror. Earlier this morning, we issued a press release detailing our financial results for the second quarter of 2016. I will review the financial highlights and also speak to our cash position and our financial guidance. We ended the quarter with $51.6 million in cash and cash equivalents and short-term deposits compared to $37.1 million as of December 31, [2015] (Ph). Research and development expenses were $6.2 million for the six months period ended June 30, 2016 compared to $4 million for the same period in 2015. G&A expenses were $1.9 million for the six months period ended June 2016. The same level of $1.9 million for the same period in 2015. Net loss for the quarter was $3.3 million compared to $3 million for the same period in 2016. We continue to reiterate our guidance that our resources will be sufficient to meet the working capital requirements fund planned operations and support advancement of platform technologies into 2019. Now, I would like to turn the call over to the operator for any question and answers.

[Operator:]

Thank you [Operator Instructions]. We will take our first question from Charles Duncan with Piper Jaffray.

[Unidentified Analyst:]

Good morning. This is [Sarah] (Ph) on for Charles. So congratulations on the progress. I have two questions of the ovarian cancer program. Can you speculate on the approximate number of patients and endpoints that you might use in that pivotal program and then do you believe that recent rates can cover a completion of that study?

[Dror Harats:]

So, as you know Sarah and the rest of you, we were actually looking very carefully at the results that we got at the Phase II study that we published its the results actually at the ASCO. And making the right consideration on how many patients we will need for a potential registration trial. I cannot give you the exact number, but I can tell you that that’s going to be around a little bit more than a 100 patients in the two groups of the randomized trial that will give us over 80% confidence in getting statistically significant results. And we are still debating with FDA the exact number, but it’s not going to be a huge number of patients, it’s going to be between a 100 to a 150 patient and that would be enough to actually to be potential registration trial. As you all know, in some of the trials in ovarian that were done with chemotherapy, this study actually didn’t need many patients and one of the reasons let’s say you need more patient is the compound is not very potent. As we believe that VB-111 actually shows a very significant data in ovarian taking around 120 patients in a study would be more than enough most probably and that’s the plan and that’s the discussion with the FDA. By the way that’s why it took us time to go to the FDA, because we had to actually reconsider the whole program in a good way. In terms of the amount of money that we raised and that we have right now, will that be enough to complete this trial? The answer is yes.

[Unidentified Analyst:]

Thanks.

[Operator:]

[Operator Instructions] We will now hear from RK with HC.

[Swayampakula Ramakanth:]

Good morning Dror, good morning Amos. A couple of questions on the GLOBE trial or basically the GBM studies. You know, earlier we have heard some of you saying that you are having some conversations with the FDA to see if you want to amend your current globe protocol to increase the number of events to 189 for your final analysis. Are those discussions still on or you are rethinking about that protocol?

[Dror Harats:]

The discussions are still on and actually we are calculating it with how our bio-certification and the FDA bio-certification. The recruitment goes very well and because the recruitment goes very well, it’s a very good practice to go for the more common about 75% event rate in terminating the trial and that’s basically the plan. We didn’t get a green light yet from the FDA, but I believe that we will get it, because it just makes the trial even more sensitive to actually show the positive results. So we are actually increasing the confidence in the trial.

[Swayampakula Ramakanth:]

Okay. And then regarding the expanded access protocol, is it possible for you to give us any more information than what you just said saying that you would start it in due course and you will be careful not to jeopardize anything, which is going on within GLOBE. Is there any additional information that you can tell us?

[Dror Harats:]

Yes, I knew that someone will ask about the due course. But that's fine, it's obvious. So, I'll tell you what is the plan, the plan is that we have to be very careful not to actually give the opportunity to give it as a compassionate in any case to patient that already were on our trial, because that means that that will be like a crossover, which we definitely don’t want to do. So the planning that unless we have a very specific case that we have to do it right now, which is out of the trial, we will stop this program as we are going to actually conclude the GLOBE. But we have the opportunity to accommodate some very severe cases just basic on the compassionate and we will do it case-by-case. It's a time that we will actually decide to lock the data that will be a time that we will have an official program actually enabling patients to get access to the drug until the drug will be on the market.

[Swayampakula Ramakanth:]

Okay. Thank you for that clarity. Just because you have talked about locking the trial data, so where are you in terms of recruitment rate for the GLOBE trial and is it within whatever the internal metrics are?

[Dror Harats:]

So actually we are doing very well. We are saying that we are according to plan, but actually we are ahead of plan, but wanted to be very careful, because it goes month-by-month, but right now the excitement around the trial is quite big and we are recruiting very well.

[Swayampakula Ramakanth:]

Okay. Last question from me. This is on the molecules VB-201 and VB-703 so what is the management's development plans for these molecules and you mentioned a little bit in your press release.

[Dror Harats:]

Now that this compound actually works quite well in atherosclerosis, but it was very difficult to develop them. They didn't work well enough in rheumatoid arthritis and in IBD and arthritis colitis. Although I must tell you when we looked at the CSRs, it wasn't completely negative. But nevertheless, I think we made the right decision not to develop it for these two indications. But we know that from pre-clinical work that it works quite well in NASH and in other fibrotic disease. So we are not planning to spread to known cancer or oncology indications right now as you know, but we will look very carefully to actually develop it in collaboration with a partner later on.

[Swayampakula Ramakanth:]

Thank you, Dror.

[Operator:]

That concludes today's question-and-answer session. I will now turn the call back over to Dror Harats for closing remarks.

[Dror Harats:]

So thank you all for joining our call today. Have a wonderful day. Thank you very much.

[Operator:]

That concludes today's conference. Thank you for your participation. You may now disconnect.