Cyclacel Pharmaceuticals, Inc. (NASDAQ:CYCC) Q2 2016 Earnings Conference Call August 10, 2016 4:30 PM ET
Alexander Fudukidis - Investor Relations, Russo Partners LLC
Spiro Rombotis - President and CEO
Paul McBarron - Executive Vice President, Finance and COO
Judy Chiao - Vice President, Clinical Development and Regulatory Affairs
Good afternoon and welcome to the Cyclacel Pharmaceutical's Second Quarter 2016 Results Conference Call and Webcast. Today’s call is being recorded. At this time, all participants have been placed in a listen-only mode and the floor will be opened for your questions following the presentation. [Operator Instructions] The company will also be accepting a limited number of questions submitted for via email to the address email@example.com.
It is now my pleasure to turn the floor over to you Mr. Alex Fudukidis.
Thank you, Kristen. Good afternoon and welcome everyone to our quarterly conference call. During today’s call, members of our senior management team will review Cyclacel’s financial performance and business highlights for the second quarter ended June 30, 2016.
Before turning the call over to management, I would like to remind everyone that during this conference call forward-looking statements made by management are intended to be 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 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 filings with the SEC, which include, among other things, our Form 10-K.
These filings are available from the SEC or on our website. All of our projections and other forward-looking statements represent our judgment as of today and Cyclacel does not take any responsibility to update such information.
For those of you on the phone or listening via webcast, please note that we will be accepting and answering a limited number of questions submitted via email to the address firstname.lastname@example.org.
With us today are Spiro Rombotis, President and Chief Executive Officer; Paul McBarron, Executive Vice President, Finance and Chief Operating Officer; and Dr. Judy Chiao, Vice President of Clinical Development and Regulatory Affairs.
At this time, I would like to turn the call over to Spiro Rombotis, our President and CEO. Spiro?
Thank you, Alex, and good afternoon, everyone. On today’s call, we will review the progress in our three key driver programs that is an update of our SEAMLESS Phase 3 study in acute myeloid leukemia, or AML, and the next step in our regulatory planning; a review of data from our DNA damage response program which was the subject of an oral presentation at the 2016 ASCO Annual Meeting in June; and a brief update on CYC065, our novel cyclin dependent kinase, or CDK, inhibitor program.
First, SEAMLESS. We are pleased to report that subsequent to the end of the quarter, the required number of events have been observed in the study, approximately 1.7 years after the last patient was enrolled. This marks a key milestone in our AML program with sapacitabine and our efforts to offer alternatives to elderly AML patients with unmet medical needs.
Preparations for final analysis and reporting of SEAMLESS outcomes are underway. Over the next several weeks we will complete data cleaning and validation operations after which the data will be transferred from our database managers to our statistical analysis vendor.
Once the analysis is completed, we will report outcomes for the primary overall survival and secondary endpoints and determination of submissibility of the SEAMLESS data set to regulatory authorities in Europe and the United States.
In preparation for submission for possible marketing authorization, we have engaged regulatory experts to plan our filing strategy. In parallel with this activity, we are progressing the pediatric investigation plan for sapacitabine with the European Medicines Agency or EMA.
Let me now turn to our DNA damage response program where we are evaluating a combination regimen of our two orally administrated candidates sapacitabine and seliciclib, a first generation CDK2/9 inhibitor.
The trial is a Phase 1 dose escalation study conducted in all-comer heavily pretreated patients with advanced and incurable solid tumors. Data from the study were presented in June at an oral presentation at the 2016 ASCO Annual Meeting. The investigators enrolled 67 heavily pretreated patients. Antitumor activity was observed in a subgroup of 45 patients with breast, ovarian and pancreatic cancers who tested positive for BRCA mutations.
A disease control rate of 35.6% was observed with durable responses, including one complete response, five partial responses and 10 stable disease. Treatment durations range from one year to more than 4.7 years in four responding patients, two with ovarian and two with breast cancer, with a longest duration observed in two patients with breast cancer. Treatment durations for the two responders with pancreatic cancer range from 16 to 21 weeks respectively.
Responders include patients who under went prior treatment with PARP inhibitors and PARP naïve patients. No PR was observed BRCA negative patients. We are very encouraged that the study continues to show evidence of activity in BRCA positive patients and provides early validation of a DNA damage response hypothesis.
There is an unmet medical need in the population with no approved therapies for BRCA positive breast and pancreatic cancers for well-tolerated, durable combination regimens that can control disease progression. We believe that our regimen has shown so far strong signals of activity and a good tolerability profile and may be an alternative to PARP inhibitors in this targeted population of patients.
Because of the promising and durable activity observed with our combination regimen in BRCA-positive patients, investigators at Dana-Farber are currently enrolling a Part I extension cohort on approximately 20 patients with BRCA-positive breast cancer. All patients will undergo whole exome sequencing with a goal of further characterizing clinical effects, including prior treatment with platinum or PARP inhibitors. In addition, we plan to initiate a Part 3 of the study to include patients with BRCA-positive ovarian and pancreatic cancers.
I would like to now provide a brief update on our CDK inhibitor program. Our Phase 1 first-in-human trial of CYC065, a second-generation CDK2/9 inhibitor in patients with advanced solid tumors continues to enroll. This study is led by Dr. Geoffrey Shapiro of Dana-Farber Cancer Institute in Boston. In this dose-escalation study we have reached the sixth dosing level without severe toxicity thus far.
CYC065 operates by the same mechanism of action as seliciclib but is more potent and has improved pharmaceutical properties. The study will evaluate CYC065's safety, tolerability, and pharmacokinetics. The findings from this translational study, including data from patient biospecimens, will allow us to determine the effect of CYC065 on pharmacodynamic markers of biological activity such as MCL-1 protein levels.
Cyclacel and independent investigator of preclinical data validate that the putative mechanism of action of CYC065 is the reduced levels of MCL-1 and notably also levels of the MYC or MYC oncoprotein [ph]. The clinical data presented at the 2016 AACR Annual Meeting support beneficial combinations of CYC065 with BCL-2 inhibitors, including the recently approved drug venetoclax and BET or bromodomain inhibitors.
In parallel, a recent publication demonstrated that the resistant mechanism to venetoclax in AML is driven by the upregulation of MCL-1 and Bcl-xL. The office concluded that targeting MCL-1 and Bcl-xL concomitantly or in alternative cycles will prevent acquisition of resistance to venetoclax.
Additionally, researchers at Yale University demonstrated that CYC065 alone or in combination inhibits tumor growth in uterine serous carcinoma, or USC, an aggressive endometrial cancer with limited treatment options. The researchers found that approximately 90% of USC tumor samples overexpressed the cyclin E gene which is responsible for cellular proliferation and transcribes the cyclin E partner of CDK2.
CYC065 inhibited cellular proliferation of cyclin E amplified USC models in vitro and also reduced tumor growth in mouse xenograft models. Elevated expression of cyclin E has been reported in many human cancers, including breast, colon, gastric, lung and high-grade serous ovarian, and has been correlated with poor prognosis and drug resistance.
The researchers found cyclin E expression to significantly correlate with sensitivity to CYC065 in vitro and that the cellular mechanism of action is consistent with inhibition of the CDK2 cyclin E complex in cyclin E amplified USC cell lines.
The findings support and extend previously reported the clinical data that CYC065 reverses cyclin E mediated resistance to trastuzumab inherent to positive breast cancer. We look forward to reporting data from the ongoing Phase 1 trial and informing you of next steps in this molecule development.
Before turning over the call to Paul, let me update our key upcoming milestones. SEAMLESS study, database locked in preparation for final data analysis, report topline data and determination of submissibility to regulatory authorities anticipate in the fourth quarter 2016; progress the pediatric investigation plan for sapacitabine with EMA; DNA damage response program progress Phase 1 sapacitabine and seliciclib extension cohort in a breast cancer patient population enriched for BRCA mutation; plan to add Phase 1 Part 3 to include BRCA mutation positive pancreatic and ovarian cancer patients.
CDK inhibitor program report topline results of the CYC065 Phase 1 trial in patients with solid tumors. Report data when available from ongoing investigator sponsored trials evaluating some seliciclib in patients with Cushing's disease and rheumatoid arthritis. Additionally, seliciclib is being evaluated in cystic fibrosis through a license and supply agreement with ManRos Therapeutics.
Sapacitabine in myelodysplastic syndromes, or MDS, plan a Phase 1/2 trial of sapacitabine in combination with other agents to determine safety and tolerability; plan a Phase 2 randomized controlled trial of sapacitabine in combination with other agents following review of all relevant clinical data with mature follow-up.
Paul will now review our financials. Paul?
Thank you, Spiro. As you saw from today's press release regarding our consolidated financial statements for the quarter ended June 30, 2016 and June 30, 2015, our cash and cash equivalents was $15.9 million. We have no debt.
Revenue for the three months ended June 30, 2016 was $0.2 million compared to $0.3 million for the same period of the previous year. The revenue is related to previously awarded grants from the U.K. government being recognized over the period to progress CYC065 to IND and complete IND-directed preclinical development of CYC140, a novel, orally available, Polo-Like Kinase 1, or PLK 1, inhibitor.
Research and development expenses were $2.6 million for the three months ended June 30, 2016 and June 30, 2015. General and administrative expenses were $1.3 million for both the three months ended June 30, 2016 and June 30, 2015.
You would have seen from our SEC filings that we effected at the end of May a one-for-twelve reverse stock split of the company's outstanding common stock and the fully diluted number of shares is now approximately 3.5 million.
Additionally, we received notification from the Listing Qualifications Staff of NASDAQ that the company regained compliance with the minimum bid price rule for continued listing on The NASDAQ Capital Market.
As I mentioned earlier, as of June 30, 2016, our cash and cash equivalents was $15.9 million. During the quarter, we entered into an At Market Issuance Sales Agreement with FBR Capital Markets & Co. under which the company may, from time-to-time, sell shares of the company's common stock having an aggregate offering price of up to $4 million through FBR. The current cash balance excludes any amount available under the FBR agreement.
Based on current plans, the company estimates that it has capital resources to reach beyond the final analysis of SEAMLESS and continue existing programs, including the oral combination of seliciclib and sapacitabine and completion of the Phase 1 study of CYC065 in advanced solid tumors, with a cash runway through the end of the first quarter of 2018.
Operator, we are now ready to take questions.
Thank you. [Operator Instructions] And we have no audio questions at this time.
Thank you operator, and thank you, all, for participating in our update call and your support of Cyclacel's efforts to serve patients in need. We look forward to updating you on SEAMLESS and our CDK inhibitor program in the coming months.
Operator, at this time, you may disconnect the line.
Thank you. Ladies and gentlemen, this does conclude today’s conference call. You may now disconnect your lines and have a wonderful day.
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