Celyad SA (CYAD) CEO Filippo Petti on Q4 2019 Results – Earnings Call Transcript


Celyad SA (NASDAQ:CYAD) Q4 2019 Earnings Conference Call March 25, 2020 8:00 AM ET

Company Representatives

Filippo Petti – Chief Executive Officer

David Gilham – Vice President of Research & Development

Frédéric Lehmann – Vice President of Global Clinical Development and Medical Affairs

Stephen Rubino – Chief Business Officer

Jean-Pierre Latere – Chief Operating Officer

Conference Call Participants

Raju Prasad – William Blair

Nick Abbott – Wells Fargo

Ed White – H.C. Wainwright

Sandra Cauwenberghs – KBC Securities

Operator

Ladies and gentlemen, thank you for standing by and welcome to 2019 Financial and Operating Results and Business Update Conference Call. At this time all participants are in a listen-only mode. [Operator Instructions]. The conference is being recorded today and that’s 25th of March 2020.

I would now like to hand the conference over to your speaker today, Filippo Petti. Please go ahead, sir.

Filippo Petti

Thank you, operator, and thank you everyone for joining us for our full year 2019 results conference. Joining me from the management team is Dr. David Gilham, Vice President of Research & Development; Dr. Frédéric Lehmann, Vice President of Global Clinical Development and Medical Affairs, Dr. Stephen Rubino, Chief Business Officer and Jean-Pierre Latere, Chief Operating Officer.

We will start the call with an operational and clinical update, followed by an overview of the financials, and we’ll outline the key expected key milestones of the company over the next several months. We will then open the line for your questions.

Before we get into our earnings update, I would like take a brief moment to address the current situation affecting everyone with regards to the online COVID 19 pandemic.

Our first and foremost priority is for peoples safety, including our employees, healthcare professionals on the front lines and especially all patients participating in our ongoing clinical trial programs.

With this in mind, and given the continued uncertainty around the full impact that the COVID 19 pandemic will have on our daily life and business operations, please note that any long term projections made during this call are based on our current assessment of the situation as it stands today.

We will continue to monitor for updates from federal and local governments and the entire Celyad team is committed to making this the most prudent decisions regarding the status of our clinical and business operations with everyone’s safety as the primary concern.

Consistent with the guidelines in both Belgium and the United States, Celyad has adopted strong measures to help prevent the spread of the virus and protect our employees. Several weeks ago we took precautionary steps to suspend all travel of our employees, which would result in the postponement of our R&D Day in New York. In addition, we implemented a work from home policy for all employees whose job function can be accomplished remotely.

For critical work, particularly for cell therapy manufacturing processes, the company has instituted the establishment of small, mirror [ph] teams that can be deployed on non-overlapping days to accomplish tasks required to fulfill our responsibilities to those patients enrolled in our ongoing clinical programs.

We are constantly monitoring the situation with clinical investigators and department medical centers, with our clinical studies and are active in order to ensure we can support them and their patients to the best of our ability.

To-date the company does anticipate enrolment delays within our clinical programs for acute myeloid leukemia and myelodysplastic syndromes. As a result of the pandemic and the company will adjust its plans and ongoing clinical trials as the situation continues to evolve. We will continue to provide updates on any changes to project the timelines as soon as they are available. Thank you for your continued support and we hope that all of you remain safe.

Quickly turning over, it was approximately one year ago where I took the reins of CEO of Celyad and pledged to execute our strategy by leveraging our industry leading technologies and capabilities to brining cancer patients with poor prognosis, innovative new CAR-T therapies.

During this time we have advanced a number of exciting clinical programs within our pipeline of NKG2D receptor of autologous and allogeneic CAR-T candidates, introducing several new programs and we brought our innovative OptimAb manufacturing process to the forefront in support of our clinical development activities in our acute myeloid leukemia and myelodysplastic program.

In order to generate broad awareness of our exciting work and progress, we made it a priority to actively announce clinical and preclinical data corresponding to our milestones at Global Medical Conferences. While I’ll let Frédéric and David discuss the specific data from our clinical and preclinical programs in a moment, I will want to mention that this effort to present new data and updates, included our presence at the 2019 Society of Immunotherapy of Cancer or SITC during the fourth quarter, where we provided additional updates from CYAD-01 alloSHRINK Phase 1 trial for the treatment of metastatic colorectal cancer.

This included initial translational data, from the industry’s first trial, investing in our off the shelf CAR-T candidate for the treatment of solid tumors. This was followed by the Annual Society of Hematology Annual Meeting in December where we presented the latest clinical results from the THINK and DEPLETHINK studies of CYAD-01, along with the preclinical data from our latest candidate CYAD-02 for the treatment of relapsed refractory AML and MDS and our OptimAB manufacturing process.

I believe that the new data presented throughout 2019 at these esteemed Medical Conferences has helped us put a spotlight on the exciting work we are pursuing at Celyad, and further endorse our position as a leader in the advancement of the CAR-T industry.

In an effort to expand our presence in the United States, while broadening our global perspective of the industry, we also recently appointed Dr. Stephen Rubino as Chief Business Officer. Dr. Rubino has more than 25 years of commercial and strategic development experience in both the pharmaceutical and biotechnology industries, with 17 years at Novartis, including several years with the company’s gene and cell therapy franchise.

His business development and commercial experience, both in and out of the United States, including directing the commercial development of products will be invaluable as we look to advance our clinical CAR-T programs forward and seek potential partners related to our assets, technology platforms and intellectual property.

Looking at our path ahead, the progress we made throughout 2019 positions us with a balanced pipeline of clinical and preclinical CAR-T candidates, including two autologous clinical CAR-T candidates for the treatment of relapsed/refractory AML and MDS, and a portfolio promising next generation allogeneic CAR-T candidates led by CYAD-101 for the treatment of metastatic colorectal cancer, as well as our pre-clinical allogeneic BCMA-targeted candidate CYAD-211 for the treatment of relapsed/refractory multiple myeloma. We are excited by all this traction and have several milestones on the horizon for 2020, which we’ll get to in a moment.

With that as an intro, I will now turn it over to Dr. David Gilham, who will provide an update on the implementation of our recently launched manufacturing process OptimAb, and also discuss how we’re looking to further leverage our shRNA platform to develop next generation CAR-T candidates.

We will then turn the call over to Dr. Frédéric Lehmann who will highlight details around the critical updates that we provided during the quarter and we will also then provide – I will then also provide a financial overview for the year and walk the next milestone for Celyad before we open the call for questions.

With that, I will now turn the call over to David. The floor is yours.

David Gilham

Thank you, Filippo, and thank you everyone again for joining us today. This is truly an exciting period in the company’s history. I believe the advancement of our programs throughout the past year speaks volumes about the opportunities that each candidate possesses, the indecisive nature of our teams, including lever ability to implement our new manufacturing process, OptimAb, as well as the broader opportunity we believe in our shRNA platform offers in the development of next generation CAR-T candidates.

As many of you are aware, last year we introduced our OptimAb manufacturing process for our relapsed/refractory AML and MDS program. OptimAb brings together the best attributes, and previous manufacturing processes at Celyad, including an eight day cell culture, two days shorter than the previous MAB manufacturing process, the incorporation of an NKG2D blocking antibody and the selective PI3 kinase inhibitor that help us to enrich T cells with a memory-like phenotype.

In terms of the timing, we developed OptimAb in response to the increased understanding of the role of memory cells in CAR-T cell therapy, and stems from our in-house expertise in cell therapy R&D and manufacturing. Based on research data from our in vivo experiments, the OptimAb manufacturing process led to an improved antitumor activity in a highly aggressive AML model compared to our previous manufacturing process.

We were excited to announce last September that we dosed our first patients with CYAD-01 produced by the OptimAb process in the DEPLETHINK Phase 1 trial. This was recently followed by the dosing of the first patient with our next generation NKG2D receptor candidate, CYAD-02, again produced by the OptimAb process in the Phase 1 Dose Escalation Cycle One Clinical Trial. In addition, today we also announced that the first patient from that dose expansions segment of the THINK trial with us in monotherapy CYAD-01, again produced with the OptimAB process.

Turning around short hairpin RNA or shRNA platform, as highlighted earlier, our novel Autologous NKG2D receptor, CAR-T cell therapy CYAD-02, benefits from the OptimAb process, as well as the shRNA SMARTvector technology that we have license with our partners at Horizon Discovery. The shRNA co-expressed in CYAD-02 is designed to deliver efficient knockdown with high specificity for NKG2D ligands MICA and MICB.

With CYAD-02 entering the clinic in January, we believe this is the first example of a clinical testing of a single shRNA, targeting the expression of two independent genes. Importantly, we believe this provides some insights into the opportunities afforded by this technology.

As I just discussed, our shRNA platform has already been implemented in our CYAD-02 program. However we believe there is significant potential to leverage our shRNA platform technology and specifically in our next generation allogeneic CYAD-220 series of CAR-T candidates.

Our initial approach from the CYAD-200 series targets the CD3 zeta components of the T-Cell receptor complex by shRNA knockdown to deliver novel non-gene edited allogeneic cell therapies. The preclinical in vivo data we have generated to-date demonstrates that targeting CD3 zeta not only reduces the Graft-versus-Host Disease effect and interesting leads to increased assistance to T-Cells with the shRNA knockdown as compared to T-Cells with the a gene edited CD3 details.

Our lead product candidate from this series CYAD-211 targeted BCMA for the treatment of relapsed/refractory multiple myeloma. Our teams are currently working towards a submission of an investigational new drug application to CYAD-211, which we’ve had to file by mid-2020, as we continue to anticipate CYAD-211 entering a dose escalation Phase 1 trial within the year.

With that, I would like to turn the call over to Frédéric, Celyad’s VP of Clinical Development. Frédéric?

Frédéric Lehmann

Thank you, David. Let me start with a clinical update for lead product candidates, CYAD-01, for the autologous and NKG2D-based CAR-T in the THINK and DEPLETHINK trials for the treatment of relapsed/refractory AML and MDS.

Then I will highlight additional details from the CYAD-02 product candidates and the CYCLE-1 Phase 1 trial touched upon by David; and finally I will review the clinical detail from our alloSHRINK Phase 1 trial given rating our TIM based non-gene edited allogeneic NKG2D receptor CAR-T candidate called CYAD-101 for the treatment of metastatic colorectal cancer patients.

In December we presented date from the THINK and DEPLETHINK Phase 1 trials at the ASH Annual meeting. We report that eight out of the 15 available patients in the THINK study treated with CYAD-01 with any preconditioning and producing before prior manufacturing process called mAb demonstrated anti-leukemic activity. In addition, five out of the eight patients exhibited an objective response.

We have decided to advance to the expansion segments of THINK trail to further evaluate CYAD-01, but produce now with the new optimized OptimAb manufacturing process. Enrolment for this cohort of the trail began in the first quarter of each year and we now anticipate that due to the delays and enrolment attribute to the COVID pandemic, to report preliminary data for the expansions cohort during the second half of 2020.

For the depleting trail, we report at ASH that nine patients had been enrolled in the study evaluating CYAD-01, again produced with the prior mAb manufacturing process, which you’re following preconditioning with CyFlu at the two first two levels of the dose escalation segment of the trail. This therapy was generally well tolerated following this preconditioning chemotherapy. We are currently enrolling new patients into this study to further evaluate the CYAD-01, but this time produced with the OptimAb manufacturing process, with the plan to dose escalate up to 1 billion up-sales or inclusions in what we call the cohort 4 of the dose escalations.

Again, due the enrolment delays in the program, in this Autologous program, preliminary data evaluating the CYAD-01 produced with the OptimAb manufacturing process in the DEPLETHINK study are expected during the second half of 2020.

Turning to our next generations autologous NKG2D receptive candidates CYAD-02 as described by David. The dose escalation CYCLE-1 trail begins enrolment in January of this year. As we monitor the trail we’ll evaluate three dose levels of CYAD-02, actually 100 million, 300 million and 1 billion of cells for infusions following preconditioning with CyFlu.

The CYCLE-1 trail does allow for bridging therapy if needed between the patient [inaudible] and the infusions of the CYAD-02. A trail is being conducted at clinical sites both in the United States and in Belgium. This is starting to be another exciting step for Celyad as we continue in this advancement of our AML and MDS program with multiple access and difference clinical trials.

I would now like to turn to the recent data from the alloSHRINK trial, which represented the SITC Annual Meeting in December of last year. We reported the preliminary data from this Phase 1 dose escalation study to assess safety, the new sale for the clinical activity and the CAR-T cell kinetics of the CYAD-01 administered concurrently with the FOLFOX chemotherapy, which is here used as a non-myeloablative preconditioning in patients with relapsed/refractory metastatic colorectal cancer patients.

We were pleased to report in this Phase 1 dose escalation study that no evidence of Graft versus Host Disease has been observed following 35 injections on the CYAD-101. This is providing a proof of concept for all novel non-gene-edited team technology to reduce signaling of the TCR to T-cell receptor complex.

In addition, any host-versus-graft reaction against the allogeneic CAR-T product candidate infused appears to be limited by the FOLFOX preconditioning chemotherapy. However and probably the most exciting data we report is only a submission of quite encouraging clinical benefits, including partial response in ability to advance metastatic colorectal cancer patients who have received prior FOLFOX, oxaliplatin based chemotherapy which is providing the first every evidence of the clinical activity in allogeneic CAR-T in solid cancer indications.

Overall, this encouraging data from the study aroused for evolution of CYAD-101 results, an additional of three patients has been enrolled at the highest dose level of the dose escalation study, actually at 1 billion of cells per infusion for a total therefore of nine patients in that specific cohort.

Primary results for the completed dose escalation segment of the alloSHRINK trial are expected during the second quarter of this year. In addition based on the encouraging data observed today from study, we’ve expand the trail to further evaluate CYAD-101 with prior chemotherapy in refractory metastatic colorectal cancer patients. Enrolment in this expansion segment of the trial is expected to begin in the second half of this year, following the productions of additional CYAD-101 cell, allogeneic cells planted during mid-2020.

We are quite excited by the opportunity of this program and this represents for Celyad another first in the industry, because to the best of our knowledge the alloSHRINK trail is the first study with an Allogeneic CAR-T cell therapy for the treatment of a solid cancer indications.

Finally, and as just discussed by David, our clinical development plans and first dose escalation Phase I trial of our Allogeneic shRNA lead product candidate called CYAD-211 targeting BCMA of the treatment of relapsed/refractory multiple myeloma will be ready for submissions to the deliver to agencies for clinical development in the United States and in Europe by mid-2020.

With all that, let me turn the call back to Filippo now. Filippo?

Filippo Petti

Thank you, Frédéric. Turning to the financials, I’d like to just remind you all that our full financial details are available on the Celyad website, both in French and in English. The research and development expenses were €25.2 million for the year ended December 31, 2019 compared to €23.6 million for the year-ended December 31, 2018. The €1.6 million increase was primarily driven by spending related to our preclinical product candidates and investments in both process development and scale up of our manufacturing processes.

General and administrative expenses were €9.1 million for the year ended December 31, 2019 compared to €10.4 million for the year-ended December 31, 2018. The difference of €1.3 million was primarily due to the decrease of non-cash expense, associated with divesting of warrants and by lower consulting fees for the period.

For 2019 our net other income amounted to €5.4 million and was mainly driven by the regional grants and federal tax incentives. Primarily government grant income for the year ended December 31, 2019 due to new grants from the Walloon Region received in the fourth quarter of 2019 that was €3.3 million compared to grant income of €0.8 million for the year-ended December 31, 2018. In addition, R&D tax credit recognized as income amounted to €1.6 million for the year ended December 31, 2019 compared to income of €0.3 million for the year-ended December 31, 2018.

Net loss for the year ended December 31, 2019 was €28.6 million or a loss of €2.29 per share compared to a net loss of €37.4 million or a loss of €3.36 per share for the same period in 2018. The decrease in net loss between periods was primarily driven due to the increase in our net other income.

Net cash used in operations, which excludes non-cash affects for the year-ended December 31, 2019 amounted to €28.2 million compared to €27.2 million for the same period in 2018. Again, the difference was primarily driven by an increase in the spend associated with research and development.

As of December 31, 2019 we reported treasury position of approximately €39.3 million or $44.0 million. We expect the existing treasury position will be sufficient based on the current scope of activities to fund operating expenses and capital expenditure requirements through the first half of 2021.

In closing, the start of 2020 has kept Celyad, the team very excited, albeit in the face of the challenging times associate with COVID-19. We look forward to achieving additional milestones over the next several months, including reporting additional data from the dose escalation segment of the CYAD-101 alloSHRINK Phase 1 trial during the second quarter of 2020.

The submission of the IND application of our shRNA based allogeneic BCMA CAR-T candidate, CYAD-211, for the treatment of patients with relapsed/refractory multiple myeloma by mid-2020, reporting preliminary data of CYAD-01 candidate produce with the OptimAb manufacturing process, including the expansion segment of Phase 1 THINK trail as well as the dose escalation Phase 1 DEPLETHINK trails here in the second half of 2020; starting the expansions segment of the CYAd-101 alloSHRINK Phase 1 trial during the second half of 2020 and reporting preliminary data from the dose escalation, CYAD-02, Phase 1 CYCLE-1 trial by year-end 2020.

And with that, I’ll now turn the call over to the operator for any questions.

Question-and-Answer Session

Operator

Thank you [Operator Instructions]. Thank you. We will now take our first question. Please go ahead caller. Your line is now open.

Raju Prasad

Hey, this is Raju Prasad from William Blair. Thanks for the update and congrats on all the progress in 2019. A couple for me; on the Autologous platforms, it sounds like you are going to have substantial data with kind of various treatment modalities. Aside from obviously you know clinical signals are there certain engraftment persistence parameters that you’re going to be looking for when kind of determining the ideal regimen to take forward.

Filippo Petti

Hi Raju, thanks for the question. It’s a very good one. I think we’re looking at this. It’s – you know the Autologous acute myeloid leukemia program or MDS program is certainly based on a few parameters, I think we touched upon in the past in terms of metrics we want to hit to be able to take it forward and thinking about how its positioned within the competitive landscape for both of those indications.

And then yes, so that is primarily driven by clinical activity and response data, duration of response data and safety. But I think for us to tease out in terms of some of the parameters outside of that, I think it’s certainly multi factorial, thinking about which one we would push forward. Maybe I’ll turn it over to Frédéric and David to provide their thoughts a little bit, about if there’s anything specific we would look to tease out from the upcoming datasets. Frédéric?

Frédéric Lehmann

Yes, for sure, these are nice question, so we have a new program now with OptimAb manufacturing process, that’s without preconditioning in the THINK, with preconditioning debt depleting and now we are just stating the CYCLE-1 which is the CYAD-02, which is also produced by the OptimAb processes that we get professionally.

So yes, mainly and driven by clinical activity, but all about those improvements of the process, especially manufacturing processes and especially the OptimAb process as described by David, you know by sorting today of character [ph], adding a selective PI3 kinase in order to enrich the memory phenotype of the CAR-T cell, are quite critical steps to move forward in order to add potentially a difference and in creating in term of cell kinetics/cell engraftment.

So, obviously this is a critical element that will be used as correlations I would say versus the clinical activity and also a potential deal and we cross fingers in better engraftment of the cells. Obviously we have to pay attention that this does not translate in a different phase 2 profile and obviously to have an impact on the clinical activity and therefore on the diseases.

So that’s why, due to the data that would be generated, certainly in the H2 2020, we will have all those data, clinical engraftment data, safety activity in order to the take the best and comprehensive decision.

David, do you have some other elements to add?

David Gilham

Yes, thank you Frédéric. Hi Raj, just to add to that, I think there’s a broader question as well that we’re looking to answer here.

Obviously the cell to CAR-T is driven, so the observation is the importance of preconditioning chemotherapy. We are working in AML and MDS at the moment, which of course is somewhat removed from the B-cell emergency situation, so we’re also very keen to understand that the real role that preconditioning has and the reason why we have the sequencing of trials we have is to ask the question, is preconditioning or CyFlu in particular really critical to enhancing the positions of CAR-T and this particular indication where we know that the effects of CyFlu will be somewhat different to that seen in the B-cell field.

So to your point, I think it’s an important read, is to understand how the connections of T-cell activity relate to activity in the acute myeloid leukemia space and to try then to understand how that really relates to the rest of other chemotherapy related disease and of course beyond into solid cancers.

Raju Prasad

Great! Thanks. And on the allogeneic platform, can you kind of just explain your thoughts on how to assess kind of the activity of the cell therapy product or how you are assessing it in kind of combination with FOLFOX or this whole theory making more sense as far as trying to assess the actual kind of monotherapy of the sell product. Just kind of some more color on how to read that trial would be helpful. Thank you.

A – Filippo Petti

Yeah, thanks Raj. It’s a very good question there as well. As you know we set forward with the FOLFOX chemotherapy and remember that we had the sister study, SHRINK and alloSHRINK and we kind of ticked that off in being able to assess both an autologous and an allogeneic approach using the NKG2D receptor CAR-T.

You know as we’ve collected the data and have continued to have discussions with our investigators as well as KOL’s within the space, you know I think it makes sense for us to evaluate potential other chemotherapies there. I think the full theory makes a lot of sense as well and you know maybe I’ll let Fred provide some additional thoughts there.

But as we think about the expansion, a phase of the trial, we are looking at what would work best for us to truly evaluate and tease out the signal that we’ve seen so far within the programs. But Frédéric, any thoughts there in terms of the chemotherapy kind of preconditioning?

Frédéric Lehmann

Well, actually yes, so that’s a good point so – and that we have to insist on the fact that we are in the Phase 1 patient population. So all those metastatic colorectal cancer patients has been already treated per destinations by the standard of care, where oxaliplatin and/or irinotecan, but so many false hopes have been already given, once or even twice in the accident and in the metastatic previous line. So in other terms there a progressing or relapsing, even if they receive pop-ups in the back.

So really the objective here of the SHRINK autologous, but mainly the alloSHRINK study that we’re talking about here was to using the standard of chemotherapy, not at all you know to derive the potential impact on the diseases, because they are resistance to this FOLFOX. Some patients are really resistance, meaning that they progress under the FOLFOX, but to continue their focused confirmation to reinstate the FOLFOX to use it as a “preconditioning chemotherapy regimens” in order to have an idea in terms of depletions, which will be critical of using it in order to control a host of subscribed reactions.

So the approach of the FOLFOX or 3x of FOLFOX, it’s really not used quite a lot with the standard of care, that’s why there’s not a lot of free entrants, but certainly discussing with older reference that we all know and by the interactions with the investigated KOL, etcetera, we could expect kind of objective response rates, where we have talked about PR [ph] as less than 10% if it’s not around 3% to 5%.

So in that context, that’s one of the reasons why the objective response rate in the alloSHRINK study slowed sample size was quite intriguing and highly encouraging.

So to make it very short, yes, we are contemplating a different type of “preconditioning chemotherapy” and one of the other approaches that we can use is instead of FOLFOX another standard chemotherapy in metastatic colorectal cancer patients, that is for theory.

One of the advantage for example for theory is that it’s slightly less toxic for the patients. So that’s something quite important for us, especially that we are looking to out-patients clinic treatment administrations and so on that point of view – and then as just mentioned by Filippo, you know it’s always a question of simplified [ph]. So to tease out the signal out of a dose escalation study, with a few patients at the last dose level, etcetera, less at much more patients at that extension segments, so around 15 patients in order to better support this objective response rate and therefore we are really looking forward to this data quite soon.

Raju Prasad

Thank you, Frédéric.

Frédéric Lehmann

Alright, thanks.

Operator

Thank you. We will now take our next question. Please go ahead caller. Your line is now open.

Nick Abbott

Good morning. It’s Nick Abbott Nick on for Jim Birchenough this morning from Wells. Just going back to AML if I may, so for 201 you’re introducing obviously two variables, one is the chemotherapy, but also the role of bridging therapy, I think that you had pointed out just a little while ago its actually not a regiment use in AML, so we don’t have chemotherapy that’s tied to the disease. So, how do you account for these variables as you compare to a 01 or 02 – 01, and then since you’re making an additional batch of 101, given the potential of outages, now like why not evaluate 101 in there, and then I have a follow-up. Thank you.

A – Filippo Petti

Yes, sure Nick. Thanks very much for the questions. It’s great to speak with you. Good morning. Good questions around 02 and 01 and kind of how CYCLE-1 is a little bit in-depth we think for the CYAD-01 program.

You know I think as we all know the program, the 01 program was really set forward to kind of evaluate activity, but with keeping safety in mind, and so the bridging therapy was not included within the 01 program. As we’ve gone through the last few years within the program, both THINK and DEPLETHINK, I think we recognize and we’ve gotten our arms around the safety and the tolerability for CYAD-01 in the context of relapsed/refractory and known MDS.

And so for the 02 program, yes, it is a little bit of a – I think we’ve typically been I think a little bit innovative in going through sequentially, taking on some additional. I think based on what we know from the safety side where there is no bridging therapy for the 01 program and so patients go five weeks without any therapy follow their you know wash out period, and [inaudible] before receiving any of the CAR-T cells. We thought it made sense for the 02 program, not only to include the construct with shRNA target and again with B2C, what that would help out in terms of persistence, but to provide this benefit in keeping the patient’s disease in check following you know the A3 sys and being able to pull out and manufacture the cell.

So it is a little bit, you know a little bit of taking the extra step and I think it’s a step that we believe is well you know referenced in how we’re thinking about the data that we’ve produced so far from a safety side. And so we’ll have – you know really I don’t want to say apples-to-apples. We’ll be able to get a comparison between CYCLE-1 and DEPLETHINK and there is yes, you know the construct you know to push anything forward, there’s the implementation of a bridging therapy to help us out as well. We thought we could – we can evaluate both of those you know variables within the CYCLE-1 trial based on what we have so far.

On the 101, look I think this is a question we receive often in terms of where else we could go with the 101 program, AML was top of mind. We obviously were excited as Frederic pointed out around the data we’ve generated thus far within the alloSHRINK program for metastatic colorectal cancer, and I think as we gather additional data and we look to corroborate the data we’ve seen on the safety side for 101 in that context and in that indication, we’ll potentially evaluate other indications what we could evaluate CYAD-101 with and you know I think AML makes sense, especially if we hit the right marks in terms of the clinical safety and [inaudible] program.

But we also have thought about other delinquencies and we’ve thought of delinquencies that we can potentially evaluate that as well. So I think we’re just right now in data gathering mode and then based on what we see from both the AML and the 101 program, we’ll make the strategic decision of where else we can go with that clinical candidate.

Nick Abbott

Thanks then, and then in terms of you know when you gathered all the data you have from your autologous program, I mean what are your latest thoughts on what is the hurdle you want to get over in order to move an expansion phase?

A – Filippo Petti

Yeah, I think we’ve I think been talking about this for a bit of time now and it’s really – if you look at the competitive landscape, if you were to have a broad approach to the treatment of relapsed/refractory AML or MDS, it’s really the hurdle rate in our discussions with KOL’s and you know our principal investigators whose having that 25% you know response rate and go out at least three or four months within those patients. You know this way we can put the idea that we have a meaningful therapy in our head.

So I think we’re looking for that either in the monotherapy setting and THINK, as well as the DEPLETHINK trial following the CyFlu and this is why it’s important that we also brought forward our next generation in terms of the question earlier with respect to looking at bridging therapy, as well as a novel construct in trying to hit that.

Now we’ve given ourselves multiple shots on goals here to try to hit that, those two metrics, so it’s — you know really for us it’s a CRh/CRI or you know of some sort towards a quarter of the patients going out three to four months.

Nick Abbott

Okay, so and then moving to 211, so can you just confirm this is a single shRNA construct, CD3 trend, and I guess given the competitive nature in this field, it’s a next gen where you have – that you want to bring forward very quickly that provides for you know additional competence of the T-Cell. And then given the fact that you will have an allogeneic approach here, are you concerned that you know you’ll get myeloma patients who are not eligible for an autologous CAR-T due to rapidly progressing disease.

A – Filippo Petti

Both very good questions. With regards to the 211 program, correct. It’s what we call a single back down using the shRNA in targeting the T-Cell receptor and specifically this CD3 zeta component.

You know I think we’ve described this as really the ability to get the shRNA into the clinic to really validate its ability as an allo platform and an allo technology and then we you know first announced the program last year at our R&D Day in March. For us you know where as described earlier, we planned to file an R&D here in the next several months and then try to get that into the clinic to just help validate that.

But I think for us, just being able to take that non-gene-edited technology and get into the clinic and that would be roughly, you know where it would be around the two year marker, so plus or minus a few months from when we first brought that technology onboard from Horizon Discovery. So I think that is pretty for an aloe CAR-T approach, I think it would be pretty rapid. So I think we’re excited about that.

In terms of the clinical question, you know in terms of the patients, I’ll maybe turn it over to Frederick in thinking about you know who would be you know really looking. We’re looking at relapse/refractory multiple myeloma patients that have been thinking about who may not be eligible for the autologous. I’ll let Frederic describe some of the stuff there.

Frédéric Lehmann

Yes, thank you for the questions. So indeed as mentioned by Filippo, the key business objective of the study is really to validate the shRNA technology in the context of the allogenic setting, so that’s critical, and that’s what one of the original collections of BCMA multiple myeloma. We focused anytime basically on myeloma with the BCMA targeting a CAR-T autologous development.

So the key of business objectives is during the – for the patient populations, we want at the end of these business collisions, small Phase 1(2) goals level, rapid enrollment and to try to clearly ask – to be able to answer to the question, what about the engraftment, what about the safety, what about the control of the Graft-versus-Host Disease and what about the impact on the disease?

So what was quite easy I would say for the very first dose of Phase 1 predication; it’s a phase 1 patient population. It’s a patient population, because we copy paste, if I dare to say it like that, the patient populations of different autologous CAR-T for the moment, so it should be a documented multiple myeloma, relapse/refractory to at least to prior with effect each a treatment regiment, which should include at least an image [ph] and the PI’s etcetera. So it’s exactly all the same criteria, eligibility criteria in terms of what you have seen for all the autologous graphical Phase 1 proceeding CAR-T.

Having said that, yes, your question about are we enrolling in this Phase 1 study of patients who are not eligible for an autologous program, actually we ask such kind of criteria, you know eligibility criteria that what we pay attentions mainly to-date at this stage for development is to go Institutions of Belgium and Europe at least and United States, where the autologous, there is no autologous CAR-T under development and that’s critical for us, because we would like to avoid, even at this stage of the phase 1 does escalation study, who has been biased in our selections you know. If you would have a side that has an autologous CAR-T, BCMA CAR-T from this called myeloma. This is an also given ability to enroll patients in logically.

We can be afraid that they would say ‘well, let’s enroll the patients with the most moderate disease,’ the Autologous one so therefore because the disease is more smaller, so we can wait time to produce [inaudible] and lets enroll patients with more aggressive disease and allogenic, because it’s off the shelf product.

We would like to avoid this type of bias, even if the sample size will be small. So typically the size will not have these competitions, local competitions to enroll Autologous CAR-T and the patient populations just mimicking what we have seen in the past, really to be able at the end of the clinical study that nobody is raising the hands to say it’s just negative in terms of clinical, but because you are more – taking for example, more exempt diseases are different advantages. So that is the combined effort today.

David Gilham

Filippo could I…

Filippo Petti

Yeah please, yeah David, yeah I was just going to pass it as well, so

David Gilham

Okay, sure. Hi Nick, just to take the question about the next stage development. So that’s – sadly our R&D Day we had to cancel of course because of the current conditions and there we were planning to discuss where we are and our forward looking thoughts. So, we will look to be organizing an event as and when it is really possible and so I guess I can say, watch this space, because we will use that to really discuss our thoughts about where we go into next generation candidates.

Nick Abbott

I mean David, just to follow-up, so is that really you see the just proof of connect and really you’d want to move – unless it blows your socks off you want to move a program forward. That, so it addresses some of the limitations or perceived limitations that have been applied to the autologous platform for BCMA, which presumably would also apply to an allogeneic platform.

David Gilham

Yes so, I mean there’s a number of questions that really Nick. Obviously proof of principal is the platform works, that’s first and foremost. Obviously we wouldn’t do this if we felt that we didn’t think there’s a potential for benefits to patients, and so we are pushing ahead with this construct and clearly as Frédéric was discussing, the allogeneic approach does offer different opportunities to how we look at the population, but really for us the main thing is testing shRNA platform.

Of course we how to see really significant clinical results, then we can go from there. But really this platform in terms – from an shNRA perspective really is just the first step, and has a number of things that are going on in the background which we are going to look through as we exploit this platform much further than where we are at the moment. So basically I think yes, is the answer to your question.

Nick Abbott

Perfect! Thanks and good luck and I’ll see you some time in the future.

Filippo Petti

Take care Nick.

Operator

Thank you. We will now take our next question. Please go ahead. Your line is now open.

Ed White

Hi! It’s Ed White from H.C. Wainwright. Thanks for taking my questions.

Filippo Petti

Good morning Ed.

Ed White

Good morning. So the first question I have is just, you had said you’re going to see DEPLETHINK the cohort 4 data in the second half of ’20. Will we also see cohort 3 date at that time?

Filippo Petti

Yes, so really because of you know the current environment, we had hoped to provide an update at the end of the first half here given some enrolment delays that we are anticipating. We plan to have both an update on the THINK as well as the DEPLETHINK trails as Frédéric alluded to in the second half of this year. So that will be the full expansion cohort for THINK, as well as cohorts 3 and 4 from the DEPLETHINK trial.

Ed White

Hey great, thanks for both. And next just on 211, something that David has said when discussing the submission of the IND in the middle of this year. He had said Phase 1 should begin within a year. I just want to clarify, does that mean by the middle of 2021 or was he implying you know before the end of 2020?

Filippo Petti

I think for us would be, I think we were thinking about it maybe from a 12 months perspective. You know if we – if the goal is to have the file, the same – submit the IND filing in the middle of this year and thinking about obviously feedback etcetera, etcetera, but you know in terms of getting the study up and running I think would be within the 12 month frame, hopefully we could get started by Q1 of 2021 let’s say.

Ed White

Okay, great, thanks for that. And then I just wanted to ask you, regarding the timing here and the impact of COVID 19 and things being delayed a little bit, you had talked at ASH about making a decision on either moving forward with THINK or DEPLETHINK by the end of 2020. Is that still – could that decision still be made in 2020 or is that being pushed out too and it’s more of a 2021 event?

Filippo Petti

Well, I think that timeline and our thoughts around the AML program in general still you know stick. We’ll give – in terms of how the data roll out for its CYAD-01 kind of shifted to the second half here of 2020, that should dovetail with regards to the initial day we plan to see from our dose escalation CYCLE-1 trial for CYAD-02. So we’ll have a good sense of the second half for both of those candidates and the overall AML and MDS program to make a decision on how we think about the program progressing forward.

Ed White

Okay, great, thanks. Those are all the questions I had. I hope everybody remains safe and healthy.

Filippo Petti

Thanks Ed for the questions. You as well, stay safe.

Operator

Thank you. We will now take our next question. Please go ahead caller. Your line is now open.

Sandra Cauwenberghs

Hi, this is Sandra Cauwenberghs speaking from KBC Securities in Brussels. To build further up on the previous question, so with regard to CYAD-02 and CYAD-101 the timeline that you have just communicated so for CYAD-02 preliminary data by year-end ‘20 and then CYAD-101, an update scheduled for the second half of ’20, this does include the current COVID situation, the delay in timeline.

And then the second question is a little bit more on the anticipated cash burn over 2020. If you could give us some guidance on that, and also in light with the current situation if you can spread cost a little bit, and with the clinical trials being delayed. So how should we look at the foregoing cash burn for 2020? Thank you.

Filippo Petti

Sure. Thanks Sandra, thank you for the question, good afternoon. As we think about the current programs and the milestones that we’ve discussed today and that are in our press release with regard to the AML program, the idea would be it is as it stands right now. We are anticipating – we’re experiencing some delays. We are anticipating some additional delays within the program. How that, how the pandemic has an impact on the program is still a day-by-day basis for us to evaluate, so as it sits right now, we do anticipate that the delay of enrolment is baked into still that timeline.

Do we think it extends out beyond that, I can’t – I think right now we feel comfortable thinking about it as a second half of 2020 update and as we gather additional information we’ll provide updates to the investors and our community and stakeholders as we learn more. But right now it is really a line that we’ll have an update for both 01 and 02 for the second half of this year, taking into account those delays.

I think if we think about the expenses, it’s a good question as well. With regards to our current cash burn, I think for 2020 you could think about it being similar to what we’ve experienced in the last few years as well in terms of the operating expenses. You know we do have the three clinical trials ongoing now, we have the expansion cohort for CYAD-101 coming onboard and that continues to be the bulk of the expense any of the associated supported those programs are our manufacturing, etcetera.

So I think from an operating expense consideration, I think you would see it reflect what we’ve seen in the past. If some of those enrolment delays become prolonged, you could see potential savings, but I don’t see it really having a major impact on how we’re thinking about cash expense for the year and the guidance that we have with regards to having treasury position that should take us through the end of first half of next year.

Sandra Cauwenberghs

Okay, thank you.

Filippo Petti

Thank you, Sandra.

Operator

Thank you. [Operator Instructions] Currently no questions coming through at the moment, sir.

Filippo Petti

Okay, wonderful. Well, again I wanted to thank you everyone for joining our call today and we look forward to speaking with you all soon, again, and please in this current environment, please stay safe and healthy. We look forward to coming across and continuing the discussion over the coming months.

Operator

Thank you. Ladies and gentlemen, that does conclude our conference for today. Thank you all for participating. You may now disconnect. Speakers please stand by.





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