Bellicum Pharmaceuticals, Inc. (BLCM) CEO Richard Fair on Q4 2020 Results - Earnings Call Transcript

Mar. 30, 2021 10:23 PM ETBellicum Pharmaceuticals, Inc. (BLCM)
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Bellicum Pharmaceuticals, Inc. (NASDAQ:BLCM) Q4 2020 Earnings Conference Call March 30, 2021 5:00 PM ET

Company Participants

Robert Uhl - Westwicke Partners

Richard Fair - President, CEO & Director

Conference Call Participants

Wangzhi Li - Ladenburg Thalmann & Co.

Operator

Greetings, and welcome to the Bellicum Pharmaceuticals Fourth Quarter 2020 Financial Results and Corporate Update Conference Call. [Operator Instructions].

I will now turn the conference over to our host, Robert Uhl of Westwicke ICR. Thank you. You may begin.

Robert Uhl

Thank you. Good afternoon, everyone, and thank you for joining the call. With me today on the call is Rick Fair, Bellicum's President and Chief Executive Officer.

Earlier this afternoon, Bellicum released financial results for the fourth quarter and full year ended December 31, 2020. If you have not received this release or if you would like to be added to the distribution list, you can do so on the Investor Relations page of the company's website.

As a reminder, today's conference call will include forward-looking statements made under the Private Securities Litigation Reform Act of 1995, including statements regarding our research and development plans, clinical trials, plans regarding regulatory filings, review and approval of our product candidates, commercialization expectations and our financial outlook. These forward-looking statements involve a number of risks and uncertainties, and reflect our opinions only as of the date of this call. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events. Actual results may differ from those indicated by these forward-looking statements due to numerous factors, including those discussed in the Risk Factors section of our Form 10-K for the year ended December 31, 2020, and 10-Q for the quarter ended September 30, 2020, filed with the SEC and available on their website.

Now I will turn the call over to Rick Fair, Bellicum's President and CEO.

Richard Fair

Thanks, Robert. Good afternoon, everyone, and thanks for joining us. On our call today, I'll provide an overview of our recent progress and update on our GoCAR platform and programs and a financial summary of the fourth quarter and full year of 2020.

Our clinical progress in the fourth quarter was highlighted by the enrollment in apheresis of our first patient in our Phase I/II trial evaluating BPX-603 in patients with HER2-positive solid tumors, including breast, endometrial, ovarian, gastric and colorectal cancers. BPX-603 is our first dual-switch GoCAR-T product candidate to enter clinical development.

In addition to our clinical progress in the fourth quarter, we refined our focus on our next-generation CAR-T cell therapies, which allowed us to take steps to reduce our cost structure. In October, we implemented a restructuring plan that included a reduction of our headcount, pause of our BCMA GoCAR-NK preclinical program, discontinuation of discovery research and sale of our research facility. We also strengthened our balance sheet by raising capital via an underwritten offering of common stock and warrants, and repaying our outstanding debt. While some of these changes were difficult, we expect they will result in significant cost savings going forward, enabling us to focus our resources on our GoCAR clinical programs.

Before I go into the specifics of our programs, let me provide a brief reminder of our GoCAR platform, which is differentiated in 2 ways. First, we've engineered GoCAR in an effort to deliver more potent and durable efficacy. We intend to accomplish this primarily through our co-activation domain, MyD88/CD40, or MC. We believe MC signaling can boost effector cell proliferation and survival, enhance functional persistence by resisting exhaustion in the suppressive tumor microenvironment and stimulate the cancer patients' own immune system to eliminate cancer.

Second, we've engineered GoCAR for higher performance, offering the potential for superior control via our molecular switch technology. Other CAR therapies behave unpredictably due to their autonomous activity. The GoCAR antitumor effects can be controlled by the scheduled administration of rimiducid. GoCAR activity can be dialed up or down by adjusting the interval between rimiducid doses or suspending rimiducid administration. Our dual switch product candidates are designed for further improved controllability by incorporating our CaspaCIDe safety switch, which can rapidly eliminate our cells when triggered to manage acute toxicities if they occur.

We believe our next-generation GoCAR platform can address many of the shortcomings of current cell therapies. Our preclinical investigations have demonstrated some of these potential benefits, and we've observed supportive biomarker evidence of these effects in the clinic. We believe the GoCAR platform may be particularly well suited for use in solid tumors, or the effects of MC signaling may help overcome the challenges of the hostile tumor microenvironment, T cell exhaustion and heterogeneous antigen expression that have confounded previous CAR-T efforts. This is the rationale for our 2 solid tumor GoCAR-T candidates, BPX-601 and BPX-603.

Let me now provide an update for each of these programs. Our first and most advanced GoCAR-T product candidate, BPX-601, targets prostate stem cell antigen, or PSCA. The clinical data we've presented to date from dose escalation in an ongoing Phase I/II trial in pancreatic cancer have shown encouraging safety, biologic activity and biomarker data that support the hypothesized benefits of the GoCAR platform. We're particularly encouraged by the findings of tumor infiltration, GoCAR-T-mediated immunomodulation, persistence of cells for up to 9 months and changes in gene expression in the tumor microenvironment consistent with the productive CAR-T cell immune response. We've opened enrollment in the trial to patients with previously treated metastatic castration-resistant prostate cancer and plan to focus on these patients moving forward in an effort to translate these encouraging biomarker findings into clinical benefit.

In January, we announced that the FDA had lifted the clinical hold on patient enrollment and dosing for BPX-601, resulting from the death of a pancreatic cancer patient in the study. Through December and January, our team worked diligently with the agency to answer their questions and resolve the clinical hold issues. We have resumed patient enrollment without any required modification of the clinical protocol. We remain excited about the potential for BPX-601 in prostate cancer, both as a product candidate and as proof-of-concept for our GoCAR platform. We plan to present Phase I data update on BPX-601 rimiducid in these patients in the first quarter of 2022.

Now let me update you on BPX-603. This program is Bellicum's first dual switch product candidate, which has been designed to target solid tumors that express HER2. As I mentioned, we enrolled our first patient in this trial in December. Enrollment at the first dose level is ongoing. We chose HER2 as a target for BPX-603 because it's a thoroughly validated target antigen for cancer therapy and because academic HER2 CAR-T trials have demonstrated clinical activity and reasonable safety. We believe that our dual switch technology in BPX-603 may be uniquely suited to improve upon these earlier efforts by driving greater efficacy through MC signaling and providing an extra layer of safety via our switch platform.

The trial is a traditional 3 plus 3 dose escalation followed by Phase II expansions in multiple HER2-positive cancers. Dose escalation has begun at 10 to the fifth cells per kilogram, and patients will be sequentially enrolled throughout dose escalation. Patients received standard Cy/Flu conditioning followed by BPX-603. The first patient in each dose cohort will be followed without subsequent treatment, while the remaining patients in each cohort will receive weekly rimiducid to either dose-limiting toxicity or disease progression. We expect to provide initial Phase I data from this trial in the second half of 2021. We're excited to have this trial underway, and we'll keep you posted on our progress.

One final thing I'd like to mention is publication of a compelling case report of the use of our CaspaCIDe safety switch. By way of context, we have excellent clinical validation of CaspaCIDe. At ASH 2018, we presented data on 24 patients who received rimiducid to trigger CaspaCIDe to mitigate steroid-refractory GvHD caused by genetically modified allogeneic T cells. In these patients, best overall GvHD response rate was 70% with a median time to response of 1 day.

Despite these great data, one remaining question about the technology has been, will it work quickly enough to address serious adverse events like cytokine release syndrome and neurotoxicity observed in patients receiving CAR-T therapy.

In February, we announced the first reported use of the CaspaCIDe safety switch in this exact clinical situation. The report published in the digital edition of Blood was a case from an investigator-sponsored trial at the University of North Carolina of autologous CAR-T cells expressing CD19 in our safety switch. This patient received rimiducid to trigger CaspaCIDe to treat grade 4 immune effector cell-associated neurotoxicity syndrome, or ICANS, which was refractory to standard treatments. According to the investigator, the safety switch reduced the number of circulating modified T cells by nearly 60% within 4 hours and by more than 90% within 24 hours. Within 12 hours of rimiducid administration, ICANS improved to grade 1 and was fully resolved after 4 days.

While only a single case report, this is highly encouraging. Since CaspaCIDe is incorporated into a number of CAR-T and CAR-NK collaborations and our own BPX-603, we look forward to potentially adding to this data set over time. That concludes the recap of our programs.

Let me now provide a brief review of our financial results. R&D expenses were $8.7 million and $39.1 million for the fourth quarter and year ended December 31, 2020, respectively, compared to $13.3 million and $64.5 million during the comparable periods in 2019. The reduction in expenses in the fourth quarter of 2020 was primarily due to reduced RIVO-CEL activities, the manufacturing facility sale and the corporate restructuring implemented during the fourth quarter of 2020, offset by an increase in expenses related to the GoCAR programs.

General and administrative expenses were $3.4 million and $15.5 million for the fourth quarter and full year 2020 compared to $5.7 million and $30 million for the comparable periods in 2019. The lower expenses in the fourth quarter of 2020 relative to prior year were primarily due to the reduction in RIVO-CEL-related commercialization activities and the effects of the corporate restructuring that reduced employee-related expenses.

Bellicum reported a loss from operations of $13 million and $51.7 million for the fourth quarter and full year 2020 compared to a loss from operations of $13.9 million and $87.4 million for the comparable periods in 2019. Bellicum reported net income of $18.8 million and a net loss of $7.7 million for the fourth quarter and full year 2020 compared to a net loss of $29 million and $112.5 million for the comparable periods in 2019. These results include a noncash gain of $31.9 million and $46.1 million for the fourth quarter and full year 2020 related to the change in fair value of the warrant and private placement option liability.

Turning to the balance sheet. As of December 31, 2020, cash, cash equivalents and restricted cash totaled $37 million compared to $93.8 million as of December 31, 2019. In November 2020, Bellicum completed an underwritten offering of approximately 1 million shares of common stock, prefunded warrants to purchase approximately 3.1 million shares of common stock and accompanying warrants to purchase approximately 4.1 million shares of common stock.

Gross proceeds to Bellicum were approximately $25 million before deducting underwriting discounts, commissions and other offering expenses payable by Bellicum and excluding any proceeds that may be received upon exercise of the warrants. In October, Bellicum repaid in full all outstanding indebtedness and terminated all commitments and obligations under its loan agreement with Oxford Finance for a payment of $27.4 million. Based on current operating plans, we expect that current cash resources will be sufficient to meet operating requirements into the second quarter of 2022.

Reviewing our accomplishments in 2020 and looking ahead into 2021, I'm pleased by the advancement of our GoCAR pipeline, including the resumption of our clinical trial for BPX-601 in patients with prostate cancer, and IND clearance and initiation of our clinical trial for BPX-603 in HER2-positive solid tumors. We're planning to present initial clinical data for BPX-603 later this year and additional clinical results for BPX-601 in the first quarter of 2022. I remain excited about our future, the potential of the GoCAR pipeline and look forward to updating you on our future progress.

I'll now open the call to questions. Operator?

Question-and-Answer Session

Operator

[Operator Instructions]. Our first question comes from Wangzhi Li with Ladenburg.

Wangzhi Li

Just a very quick one. So could you provide any further color on what kind of data should we expect when you report the data for 603 in the second half this year and the 601 in the first quarter next year?

Richard Fair

Sure, Wangzhi. Thanks for the question. On BPX-603, I would expect the first dose level presented and perhaps a patient or two from the second dose level. I'll remind you that the design of that trial requires sequential enrollment through dose escalation. And so it does take a bit of time for us to accrue that study. So I'd expect safety data from the first dose cohort and potentially some patients from the second cohort.

As it relates to the BPX-601 readout, obviously, we're at a higher dose level there already. We're treating patients with 5 million cells per kilogram, which is a reasonable cell dose. So certainly, in dose escalation, we still are evaluating safety, but we'd also expect a fulsome analysis of efficacy and biomarker endpoints to demonstrate what we're seeing looking for a signal in metastatic CRPC. I'd expect 2 to 3 cohorts of patients there, but of course, that will be dependent upon enrollment.

Operator

[Operator Instructions].

Robert Uhl

This is Robert Uhl. I've had a couple of questions come in to me over e-mail from people on the webcast. So let me just fire away with those.

Richard Fair

Sure, Robert.

Robert Uhl

Rick, yes, "Can you provide any additional color on the patients that died that resulted in the clinical hold? And what helped the FDA become comfortable so that they would let you restart the trial without any kind of change to the protocol?"

Richard Fair

Sure. The patient who passed in the study was an elderly second line pancreatic cancer patient who received BPX-601 followed by 2 weekly doses of rimiducid. The patient developed a grade 4 cytokine release syndrome and was undergoing treatment with standard treatments. However, in parallel, the patient was diagnosed with aspiration pneumonia and sepsis syndrome, which was deemed unrelated to our treatments, of course. While these complications were ongoing, his family withdrew medical care and requested comfort care only, and the patient died subsequently later that day.

The cause of death determined by both the investigator and Bellicum was aspiration pneumonia with sepsis syndrome, and that was supported by the review of the Safety Review Committee. That said, based on the temporal relationship of death just a couple of days after the second dose of rimiducid, the FDA put the trial on hold and asked for some additional data about the patient case and about the safety that had been observed in the trial to date. Once they reviewed the information we provided, they removed the clinical hold without any required modifications to the clinical protocol. So while they don't clarify how they interpreted the data that we submitted, I think it's reasonable to assume that their analysis was the same as ours that this was an unfortunate case of a very sick elderly pancreatic cancer patient who died of complications.

Robert Uhl

Okay. Thank you. And then one other one question that's come in is about the case report of the use of the CaspaCIDe technology. "You mentioned it's in a number of collaborations. So can you just tell us about those? And what kind of economics it represents for you? And does it report like this help bolster your BD effort to get that out there into more people's hands and into their programs?"

Richard Fair

Sure. Thanks for the question, Robert. We remain very excited about the safety switch. We think it's a useful addition to really any cell therapy. And the performance observed, as I reported in both the previous experiences reported at ASH a couple of years back, in this case report suggests it's really a best-in-class solution for acute toxicities of cell therapies.

We're open to partnering this technology. I would say, to date, most of the collaborations that we have are academic collaborations with investigators who are pursuing new cell therapy constructs or new targets that may have a particular safety liability and what the additional comfort of having the safety switch embedded. But of course, some of those then translate into more meaningful collaborations for us. For example, we previously announced our agreement with MD Anderson for their CaspaCIDe containing a CD19 CAR-NK candidate, which we share in the economics they receive for the project from their licensee, Takeda. That project continues to advance, and we remain open to pursuing deals of this nature opportunistically when they make financial sense and when they don't compete with our pipeline.

Robert Uhl

Okay. Terrific. Thank you.

Operator

Thank you. And there appears to be no more questions from our audience. I will now turn the call back to Mr. Fair for closing remarks. Thank you.

Richard Fair

Thanks, everyone, for participating today. If you have additional questions, feel free to contact us any time.

In closing, I'd like to thank our great team of Bellicians, our collaborators and our investigators for their efforts in these extraordinary times. And as always and most importantly, I'd like to thank the patients and the families who participate in our clinical trials. They inspire our effort each and every day. Thanks, and have a great evening.

Operator

Thank you. This concludes today's call. All parties may disconnect. Have a great evening.

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