Vascular Biogenics Ltd.
Q2 2015 Earnings Call Transcript

Published: 13 Aug 2015

[Operator:]

Good morning and welcome. A press release of the Company's second-quarter 2015 financial earnings became available at 8 o'clock AM Eastern Time today and it can be found on the investor section of the Company's Web site at ir.vblrx.com. Before we begin, I would like to remind callers that the information discussed on the call today is covered under the Safe Harbor provisions of the Private Securities Litigation Reform Act. I caution listeners that VBL's management will be making forward-looking statements. Actual results could differ materially from those stated or implied by VBL's forward-looking statements, due to risks and uncertainties associated with VBL's business. These forward-looking statements are qualified in their entirety by the cautionary statements contained in today's press release and VBL's SEC filings. The content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, August 13, 2015. VBL undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call. We will begin with prepared comments from VBL and then we will open the call for your questions. I would now like to turn the call over to Dr. Dror Harats.

[Dror Harats:]

Thank you, Hannah. Good morning, everyone, and thank you for joining us on today's conference call. VBL made important progress in the second quarter as we announced meaningful interim data readouts for our lead programs VB-111 in both recurrent glioblastoma or recurrent GBM and platinum-resistant ovarian cancer and prepare to initiate our pivotal Phase 3 GLOBE Study in recurrent GBM. I am pleased to review these achievements to-date and to preview milestones for the balance of 2015 as we continue to pursue our mission to discovering, developing, and commercializing first-in-class treatment for cancer. Let me begin by discussing VB-111, our late-stage gene-based biologic for the treatment of cancer. As you know, VB-111 is an intravenously administrated anti-antigenic agent for the treatment of solid tumor indications and is currently being evaluated in recurrent GBM and ovarian cancer. We have received orphan drug designation for the treatment of GBM in both the United States and Europe and fast-track designation in the U.S. and are looking forward to initiating our pivotal single-needed Phase 3 study of VB-111 in the coming weeks, under a special protocol assessment agreement with the FDA. As you know, glioblastoma is a devastating, rapidly growing brain tumor that affects about 10,000 to 12,000 Americans each year, with a median time from patient diagnosis to patient deaths of 12 to 15 months and the median survival from time of recurrence of about six months. In recurrent GBM, existing treatment regimens consist of both symptomatic and palliative therapies. However, with currently available treatments, recurrent GBM remains fatal and there is a clear and compelling need for new and effective medicines. Given this treatment landscape, we are particularly encouraged by the interim data collected to date for our Phase 2 study of VB-111. At the Drug Discovery and Therapy World Congress or DDTWC in Boston in July, we announced updated interim results which showed a strengthened, statistically significant improvement in overall survival in patients with recurrent GBM who received VB-111 as a standalone drug and who, upon further progression, were treated with VB-111 in combination with Avastin, compared to patients who received VB-111 as a standalone drug and who, upon further progression, were treated with Avastin alone. Even though this trial was not powered to show differences in overall survival, VB-111 in combination with Avastin demonstrated statistically significant improved median overall survival of 16 months, compared to eight months in patients on Avastin alone, with a p-value of 0.05. VB-111 was also demonstrated a statistically significant improvement over the historical bevacizumab or Avastin data set from the [indiscernible] trial which looks at the efficacy of Avastin, Lomustine or combination of both agent and reported a median overall survival of 8 months for Avastin in 50 patients with recurrent GBM, representing a p-value of 0.003. Consistent visits, mode of action which in recurrent GBM may require more than several weeks to demonstrate clinical effect. VB-111 did not affect the time for the first progression. At the DDTWC conference, we also announced data suggesting the VB-111 induced in immune-therapeutic effect. On the 46 patient to receive VB-111, 25 spiked a fever post dosing of VB-111, at least once while 21 did not. Feverous patients demonstrated a median overall survival of 16 months compared to non-feverous patient who demonstrated to median overall survival of 8.5 months or a p-value of 0.03. This correlation between clinical efficacy and fever suggest that giving VB-111 in immune response in patients and supports our belief that the immune system plays a role as part of VB-111 mechanism of action. We look forward to reporting updated data from this Phase II trial at the medical meeting later on this year. Turning now to our GLOBE study in recurrent GBM, we are looking forward to the initiation of this single needed pivotal Phase 3 trial shortly. As you know this trial is a randomized, controlled double-arm, open label study of VB-111 dosed every two months in combination with by weekly Avastin compared to Avastin monotherapy. We expect the trial to enroll 252 patients with recurrent GBM and to recruit patient from numerous sites in the U.S. kind of [indiscernible]. And are particularly pleased to be initiating this trial under a special protocol assessment granted by the U.S. FDA. The primary efficacy end point of the study is overall survival. Secondary endpoint includes progression free survival and tumor response as measured by the growth standard chrono [ph] criteria. We expect interim analysis data upon 91 events at the end of 2016 or the beginning of 2017 and full read out of the trial upon 151 events is expected at the end of 2017. We are also happy to announce today that we had a successful preclinical trial application meeting with Health Canada's center for Evaluation of Radiopharmaceuticals and Biotherapeutics or CERB. The meeting took place with the support of the Canadian Brain Tumor Consortium which stated that the GLOBE study receive the CBTC’s full endorsement. At the meeting the CERB team expressed its support for our investigational medicinal product dossiers and declared adequate to support a Canadian CTA. We planned to submit the CTA package in the beginning of September and expect to receive Health Canada’s final approval in the fourth quarter of 2015. Health Canada’s concurrence is particularly important to us giving that we expect to enroll about a third of our GLOBE patients in Canada and in Israel. VB-111 is also being studied in an investigator initiated Phase 1-2 -- now it’s a Phase 2 already, open label clinical trial in a recurrent platinum-resistant ovarian cancer at Mass General Hospital and Dana Farber Cancer Institute in Boston under VBL’s R&D. At the American Society of Clinical Oncology at ASCO Cancer Meeting in June we announced promising interim results from the Phase 2 stage of this ongoing study which demonstrated evidence of clinical benefit in patient who received VB-111 in conjunction with weekly paclitaxel, with 60% of high-dose patient meeting the CGIC response criteria based on the reduction of at least 50% in the CA-125 tumor-marker levels. In this study VB-111 was safe and well tolerated with anticipated toxicities. We keep all recruiting for this trial and we keep on getting similar clinical benefit with this drug. We continue to be encouraged by this promising data all the more so because VB-111 is the first enlist compound to emerge from our Vascular Targeting System or VTS, our innovative gene therapy technology which enables the targeted and specific expression of a gene of choice in angiogenic blood vessels through unique super enhancer DNA regulatory sequences. The VTS platform is made up of three elements; a viral vector, our proprietary semi-artificial PPE-1-3X promoter and the transgene which works in tandem to target genes exclusively to angiogenic blood vessels. Once the gene therapy has reached angiogenic blood vessels our genetically modified promoter activates transgene expression to produce a desired protein in the endothelial cells of those vessels. In cancer applications, the transgene selected is designed to destroy angiogenic blood vessels that feed solid tumors. We believe VTS is a ready platform enabling the discovery and development of truly innovative oncologies and other therapies. We are also continued to explore the potential of our platform in indication beyond the recurrent GBM and ovarian cancer. I’ll now turn the call over to Amos Ron, our Chief Financial Officer. Amos?

[Amos Ron:]

Thank you, Dror. Earlier this morning we issued a press release detailing our financial results for the second quarter of 2015. I will review the financial highlights and also speak to our cash position and our financial guidance. We ended the quarter with $31.5 million in cash and cash equivalents, and short-term deposits, compared to $36.8 million as of December 31, 2014. Research and development expenses were $4 million for the six months period ended June 30, 2015, compared to $5.3 million for the same period in 2014. G&A expenses were $1.9 million for the six months period ended June 30, 2015, compared to $1.5 million for the same period in 2014. Net loss for the quarter was $3 million, compared to $3.7 million for the same period in 2014. In summary, we continue to have resources in place to execute on our corporate objectives. We expect that our cash and cash equivalents will be sufficient to meet the estimated working capital requirements, fund planned operations, and support the advancement of our development plan with both the Vascular Targeting System and Lecinoxoid platform technologies through the second quarter of 2017. Now, I would like to turn the call over to the operator for any Q&A.

[Operator:]

Thank you. [Operator Instructions] We will now take our first question from Mike King from JMP Securities. Please go ahead, your line is open.

[Mike King:]

Pretty up to speed on most aspects of the story, I'm just wondering if Dror if you can talk about the possibility of sampling patients -- during therapy or perhaps or on autopsy to look for the presence of things like [indiscernible] and other immune infiltrates to further validate the immune modulatory aspects of 111?

[Dror Harats:]

So, definitely we would like to do it, because we think that that's very important and in the ongoing trial that we're running now in ovarian, in the protocol we are allowed to get biopsies of course and the patient needs to consent for that and we're trying to get samples from these ovarian patients and hopefully we will have a sample soon, because as you can guess, we are also very much interested to do this pathological evaluation. Of course, in brain tumor in GBM it's much more complicated, so the aim is to do it in the platinum resistant ovarian cancer.

[Operator:]

We will now take our next question from Joe Pantginis from Roth Capital Partners. Please go ahead, your line is open.

[Joe Pantginis:]

First two questions are around the Phase 3 if you don't mind. First, can you just maybe remind us the statistics around the Phase 3, the powering and maybe what the stopping rules are for the interim analysis? And the second question is, at ASCO at your analyst event, you went through an interesting flowchart where it seems like you've really gone through a significant amount of work to make sure that patients stay on study -- to do what you can to make sure the patients stay on study. So I'm just wondering if you could just walk us through again on how patients can stand study effectively based on potential progression in the study. Thanks a lot.

[Dror Harats:]

The study -- the Phase 3 studies an events driven the trial, we means that when we'll get to 91 events -- 91 tests we're going to do the interim analysis and this is mainly for a futility so, if we see that the lines are actually going up together and there is no or only a small fraction of chance that we will have a successful trial then we'll stop the trial for futility. It is not meant to be an interim analysis for efficacy, although of course if the data will keep on in the similar way to what we do see in the Phase 2, we might even see a statistical significant event there. But because the curves separate very quickly but much more so later on we don’t expect to get a very meaningful results for efficacy then, unless it will actually imitate what we have in the Phase 2 or doing even better. When we calculate this study actually, we were estimating we will get about a 12 months median overall survival in the treatment group which is VB-111 and with Avastin compared to about a 9.2 months which is a best ever shown for Avastin alone and that's within 85% power, but now that we do see that overall survival is even longer and we expect to have significant a number of patients actually alive on 12 months, we might even get to a stronger power for this drug. You mentioned in your second question a very important issue, because we know that it takes time for the drug to work and if the patient are off drug before they really have a chance to respond, then we’re losing patient that might be responsive to the drug. And therefore we work together with a participant who actually enroll, there are no criteria and he is the Chairman of the Seiren [ph] Committee of this trial and he was the Chairman of the Phase 2 trial that we run and the FDA to make sure that we give the drug as long as possible and keep the patients on the VB-111. So the way we do it we’re going to use, there are no criteria for progression. So with the patients tumor is increased by 25% and that doesn’t matter if it effects the tumor itself or just the flare around it, that’s called progression. So that would be for the progression free survival in the secondary end point. That for the trial itself the rules are going to be as following. If the tumor is not growing, the tumor itself not the flare by at least 50% patient will stayed on the drug, unless there is a major clinical deterioration. So even if this tumor grew by 25% the patient will stay on the drug. And the second thing is there is a flare it is not considered as growth of the tumor unless flare keeps growing in the next MRI two months later. So even if there is a flare the patients will be treated at least by 2 doses of VB-111 and if the flare subsides which we’ve seen in most cases in our study, then the patient was stayed on the drug. So this will ensure that the patients will get the benefit of doubt and we’ll get enough of the drug so that we can detect efficacy of this drug.

[Joe Pantginis:]

Great. Thanks a lot guys.

[Operator:]

We will now take our next question from Wendy Lam from Oppenheimer. Please go ahead. Your line is open.

[Wendy Lam:]

Thanks for taking my question. Can you just remind us when we should expect the next update for 111 in thyroid cancer? What data we should expect and then your developmental plan going forward? Thanks.

[Dror Harats:]

So as you know we also keep following the patient in our Phase 2 thyroid cancer. The Phase 2 thyroid cancer started quite early after the Phase 1, when we notice that we have two in the Phase 1 study with thyroid cancer that had an objective response. So in the thyroid cancer we have two group of patient, one group patient has got 3x10^12 [ph] which is a low dose, as the single dose and that our control group. And the second group is we’re getting the full dose which is 10 to 13 every two months. And we already announced in the group that got a full dose. We got 35% six months progression fee survival which was the primary end point of this trial, which is much more than the expected two months progression fee survival which is really not any progression fee survival because that’s the time that you do the next imaging. But we are following the patient and we are going to announce data including survival data in October meeting of the American and International Thyroid Cancer Association in Florida and that’s going to take place in October and we’re going to announce exact data we’re going to present.

[Operator:]

Are you ready for the next question?

[Dror Harats:]

Sure.

[Operator:]

Our next question comes from Mike King from JMP Securities. Please go ahead.

[Mike King:]

Thanks for taking the follow-up. Took care of part of my answer -- my question was the last answer drawer, but if you could remind us, I know you guys had fairly active fourth quarter second half of ‘15 calendar of meetings. I recall you said you might have some follow up date at snow, could you just remind us if that’s correct and what we might see there? And I thought there was another meeting as well, but that might have been the thyroid meeting that you just talked about.

[Dror Harats:]

So actually you’re completely right Mike. We have a quite a crowded counter of meetings and we are going present at the ASCO meeting in Europe on the September 27th and that’s going to be an oral presentation where we are going to actually present the full data on Phase 2 GBM trial including more accurate survival data. We still have patients on the drug and we still have patients that we’re following at are alive on the arm that’s treated with VB-111 and then with the combination of VB-111 and Avastin. By the way on VB-111 alone all the patients are dead now or there is one patient left to follow up, so it has to be considered as dead. And on this conference we’re going to also show some response rate of the drug. As we said all the time, it takes time for the drug to actually show the aging of the tumor, so we’re going to announce that on this as well and this is going to be quite compelling. In October we’re going to show the thyroid data as I said and then at the snow meeting we’re going to actually show the rest half of the Phase 2 trial in GBM and we’re going to there a satellite conference where we're going to discuss the program in GDM and the GLOBE study, as we’re going to be already recruiting at that time. And at this event hopefully we will show some comparison to a historical controlled data of multiple trials with Avastin so that we will have a solid ground to go after that to the FDA to have a status meeting on VB-111 in recurrent GBM.

[Operator:]

As there are no further questions, I would like to turn the call back to the presenter for any further remarks.

[Dror Harats:]

Thank you for participation today, in today's call. We look forward to updating you again soon. Thank you very much.