Houston Aug 7, 2020 (Thomson StreetEvents) -- Edited Transcript of Bellicum Pharmaceuticals Inc earnings conference call or presentation Thursday, August 6, 2020 at 9:00:00pm GMT
Bellicum Pharmaceuticals, Inc. - CFO
* Richard A. Fair
Bellicum Pharmaceuticals, Inc. - President, CEO & Director
* Nicholas M. Abbott
Ladenburg Thalmann & Co. Inc., Research Division - MD of Equity Research of Biotechnology
Greetings, and welcome to the Bellicum Pharmaceuticals 2Q 2020 Financial Results and Corporate Update Conference Call. (Operator Instructions) As a reminder, this conference is being recorded. Thursday, August 6, 2020.
I would now like to turn the conference over to Stephen Jasper from Westwicke. Please go ahead.
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; and Atabak Mokari, Chief Financial Officer. Later, during the Q&A session, Aaron Foster, Head of Research, will also be available.
Earlier this afternoon, Bellicum released financial results for the second quarter and 6 months ended June 30, 2020. If you have not received this release or if you'd 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 Bellicum's research and development plans, clinical trials, plans regarding regulatory filings, review and approval of its product candidates, commercialization expectations and our financial outlook. These forward-looking statements involve a number of risks and uncertainties and reflect Bellicum's opinions only as of the date of this call. Bellicum undertakes 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 Bellicum's Form 10-K for the year ended December 31, 2019, and 10-Q for the quarter ended June 30, 2020, filed with the Securities and Exchange Commission.
And now I will turn the call over to Rick Fair, Bellicum's President and CEO.
Richard A. Fair, Bellicum Pharmaceuticals, Inc. - President, CEO & Director [3]
Thanks, Stephen. Good afternoon, everyone, and thanks for joining us. On our call today, I'll provide an update on our GoCAR pipeline, and Atabak will update you on our financial results. Before I talk about our individual programs, let me briefly remind you how GoCAR is differentiated from other cell therapy approaches. Our platform is unique in 2 distinct ways. First, we've engineered GoCAR to deliver more potent and durable efficacy relative to current generation cell therapies. We believe we can accomplish this primarily through our coactivation 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 attack tumors.
Second, we've engineered GoCAR for higher performance relative to current generation cell therapies, potentially offering superior control via our molecular switch technology. Other cell therapies behave unpredictably due to their autonomous activity, but GoCAR anti-tumor effects can be controlled by the scheduled intermittent administration of rimiducid. GoCAR activity can be dialed up or down by adjusting the interval between rimiducid doses or suspending further rimiducid administration. In our dual-switch product candidates, we can further improve controllability by incorporating our CaspaCIDe safety switch, which would -- can rapidly eliminate cells when triggered to manage acute toxicities if they occur.
We believe our GoCAR platform may address many of the shortcomings of current cell therapies. Our preclinical investigations have demonstrated some of these potential benefits, and we are now observing supportive evidence of these effects in the clinic. We are pursuing 2 strategic paths to establish clinical proof of concept: First, we are targeting solid tumors, where 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. Our 2 solid tumor CAR-T -- GoCAR-T candidates, or BPX-601, targeting PSCA, and BPX-603 targeting HER2.
Our second strategy is the pursuit of an allogeneic off-the-shelf cell therapy. We believe that our GoCAR platform has the potential to drive proliferation and persistence of allogeneic immune cells and to stimulate a host immune response, both of which will be critical to delivering effective off-the-shelf therapies. We seek to demonstrate the value of our approach with our BCMA GoCAR-NK.
Let me now provide an update on each of these programs. BPX-601 targets prostate stem cell antigen or PSCA. The clinical data we have presented to date from an ongoing Phase I/II dose escalation trial in pancreatic cancer have shown encouraging safety, biologic activity, and biomarker data that supports the hypothesized benefits of the GoCAR platform in solid tumors. Specifically, we are particularly encouraged by observations 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 a productive CAR-T cell immune response.
We are now enrolling Cohort 5C, our first-in-human evaluation of repeat rimiducid dosing. Our preclinical experience suggests that regular rimiducid dosing can reactivate and expand GoCAR-T cells in the presence of tumor antigen over time, without creating T cell exhaustion and thus, maximize the clinical efficacy potential. We plan to present interim results for this cohort at a medical meeting by the end of this year.
Like many others, we have experienced the COVID-19 related impact on screening and enrollment, which may impact the number of patients and duration of follow-up that we will present. In addition, primarily due to COVID-19 restrictions at our study sites, we have been unable to date to collect post-treatment biopsies in Cohort 5C, limiting to some degree what we can assess in these patients. We will continue to work with our investigators to overcome these COVID-19 obstacles to the extent possible, and are in the process of adding a few more sites to the study to increase prescreening activity.
Looking ahead, we have submitted a protocol amendment to the FDA with several modifications to the study. Upon FDA and IRB clearance of this amendment, we plan to expand eligibility to third-line pancreatic cancer patients, which we believe will enable more prescreening. Second, informed by the risk-benefit profile we've observed to date, we will extend dose escalation to 10 million cells per kilogram. Lastly, we will add a cohort of patients with hormone refractory, metastatic castration-resistant prostate cancer. Assuming prompt FDA clearance of this amendment, we expect to begin enrollment under this amended protocol later this year. Based on the data we've seen so far and the proposed study amendments, we remain optimistic about BPX-601, both as a product candidate and as proof-of-concept for our GoCAR platform.
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. Academic CAR-T trials targeting HER2 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 FDA recently cleared our IND for BPX-603, and we are currently in study start-up to initiate a Phase I/II clinical trial later this year. The trial is a traditional 3 plus 3 dose escalation followed by Phase II expansions in multiple HER2-positive cancers. Dose escalation will begin at 100,000 cells per kilogram in a basket of HER2-positive solid tumors, and patients will be sequentially enrolled throughout dose escalation. Patients will receive standard Flu/Cy conditioning followed by BPX-603 cells. 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 are excited to get this study underway, and we'll keep you posted on our progress.
Now let's move to our BCMA GoCAR-NK program. CAR-NK cells represent an intriguing next wave in the evolution of cell therapy, so we are excited about the potential for our first off-the-shelf GoCAR-NK candidate. NK cells may be particularly well suited for allogeneic cell therapy since they have innate cytotoxicity with low propensity for causing graft-versus-host disease.
We presented encouraging preclinical data from our NK discovery program at the 2019 SITC meeting and published a paper on this work, Blood Advances, this year in May. The data showed that our GoCAR platform synergizes with secreted IL-15 to enhance NK cell proliferation, survival and cytotoxic function. In addition, GoCAR-NK cells expressing our MC coactivation domain and IL-15 resulted in superior in vivo efficacy in multiple preclinical tumor models. Based on these initial investigations, we believe that GoCAR-NK cells have the potential to be a best-in-class off-the-shelf cell therapy. We selected BCMA as the target for our initial program since it is, well validated from autologous CAR-T studies, and we expect cell therapy to play a major role in multiple myeloma treatment.
The next step for the field is to deliver similar clinical benefit with an off-the-shelf therapy, which may provide faster and more certain time to treatment, greater scalability, convenience and a lower cost to manufacture. Based on our preclinical findings, we believe that GoCAR-NK may deliver more durable efficacy than other off-the-shelf cell therapy strategies. We will seek to demonstrate this in our development program. Our preclinical development is ongoing, and we expect to present additional data for this program by the end of 2020.
That concludes the summary of our programs. So let me now turn the call over to Atabak for a review of our financial results.
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Atabak Mokari, Bellicum Pharmaceuticals, Inc. - CFO [4]
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Thank you, Rick. R&D expenses were $11.8 million for the second quarter of 2020 compared to $20 million for the second quarter of 2019. The reduction in expenses in the second quarter of 2020 was primarily due to reduced expenses related to reduced RIVO-CEL-related activities, reduced expenses resulting from the April 2020 manufacturing facility sale and the reduction in force that was implemented during the second half of 2019. These reduced expenses were partially offset by increased expenses related to our GoCar-T and GoCAR-NK programs.
General and administrative expenses were $3.8 million for the second quarter of 2020 compared to $7.5 million during the comparable period in 2019. The lower expenses in the second quarter of 2020 was primarily due to the reduction in RIVO-CEL-related commercialization activities and the effect of the reduction in force that reduced employee-related charges.
Bellicum reported a net loss of $43.2 million for the second quarter of 2020 compared to a net loss of $26.9 million for the comparable period in 2019. The second quarter 2020 results included a noncash loss of $30.7 million related to the change in fair value of warrant liability and net gain on dispositions of $3.8 million due to the manufacturing facility sale.
Turning to our balance sheet. As of June 30, 2020, cash, cash equivalents and restricted cash totaled $68 million. In the second quarter, we had a cash loss from operations of approximately $14.2 million, which was a decrease from prior quarters given the steps we have taken to streamline the organization.
In April, Bellicum closed a transaction in which the MD Anderson Cancer Center acquired our manufacturing facility in Houston for $15 million. Concurrent with the transaction, Bellicum repaid $7 million of its Oxford Finance debt obligation.
Based on current operating plans, Bellicum expects cash utilization of $55 million to $65 million for the full year 2020 compared to cash loss from operations of approximately $30.5 million for the 6 months ended June 30, 2020. We believe that the current cash resources will be sufficient to meet operating requirements into the second half of 2021.
And now I'll hand the call back over to Rick.
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Richard A. Fair, Bellicum Pharmaceuticals, Inc. - President, CEO & Director [5]
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Thanks, Atabak. Reviewing our accomplishments so far in 2020, I'm pleased by the advancement of our GoCAR pipeline across our 3 programs. I'm particularly enthusiastic as we anticipate an increasing number of potential data milestones. Over the next 24 months, for BPX-601, we expect to present 2 updates in pancreatic cancer and our first data in prostate cancer. For BPX-603, we expect steady start in our first patient from dose escalation. And for our GoCAR-NK program, we expect multiple preclinical presentations and IND submission.
I remain excited about Bellicum's future, the potential of our GoCAR pipeline and look forward to updating you on our future progress, including our first-in-human data with repeat rimiducid dosing and preclinical data on our GoCAR-NK program later this year.
I'll now open the call to questions. Operator?
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Questions and Answers
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Operator [1]
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(Operator Instructions) And our first question comes from the line of Jim Birchenough with Wells Fargo Securities.
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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division - Director & Associate Analyst [2]
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It's Nick on for Jim. And keeping us on the toes there with a new way to register and address all of your question. So the first thing, Rick, on 601. So has there been any readthrough from emerging repeat dose rimiducid data that's sort of led to this, I think, what we'd interpret as a renewed interest in expanding the 601 program?
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Richard A. Fair, Bellicum Pharmaceuticals, Inc. - President, CEO & Director [3]
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No, I think the expansion in the prostate, which is probably what you're referring to, Nick, is -- been a long-standing interest of ours. And I think we've now -- we're approaching the end of the dose escalation that we initiated in pancreatic cancer and now's the time to explore an expansion mode, a different tumor type. I think we all acknowledge that pancreatic cancer is a very challenging tumor. And we certainly don't want to miss a signal by not looking a little more broadly. So I think this is really just fulfillment of the previously articulated plan.
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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division - Director & Associate Analyst [4]
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Okay. And then, in terms of the patients that you'll be enrolling with prostate cancer, do they have to fail the specific number of lines of treatment? And then, just from a perspective of this is a very bone-centric cancer, do you have preclinical data that supports that 601 is able to penetrate bone mets?
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Richard A. Fair, Bellicum Pharmaceuticals, Inc. - President, CEO & Director [5]
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Yes. On your first question, eligibility inclusion criteria, patients have to have received an anti-androgen therapy and either received or are ineligible for a taxane. And then for the subsets of patients that qualify, either MSI-high for anti-PD-1 or BRCA mutant for PARP inhibitor have to have received those therapies as well. So it's a later line patient population.
As far as bone mets, I don't think we have any specific preclinical data for BPX-601, but we will certainly be looking at the translational data as we embark and treat the patients in the study.
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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division - Director & Associate Analyst [6]
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And then just on 603, you gave us some outlines on -- of the trial design, so 3 plus 3, those patients. So is that the first patient at every dose level would not receive rimiducid?
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Richard A. Fair, Bellicum Pharmaceuticals, Inc. - President, CEO & Director [7]
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Yes, that's correct. The -- so it's a traditional 3 plus 3 design with some modifications, and that's certainly one of them. So you would expect in each cohort and dose level in each of the study, the first patient would receive cells only, and the second 2 patients in the absence of a dose-limiting toxicity would receive cells plus weekly rimiducid.
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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division - Director & Associate Analyst [8]
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And so presumably that first patient then will stay in the hospital, be intensively monitored. Do you have -- I mean, what -- can you discuss what the triggers are for administering the rapalog to activate the kill switch?
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Richard A. Fair, Bellicum Pharmaceuticals, Inc. - President, CEO & Director [9]
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I think in summary, depending on the toxicity, it's essentially failure of standard of care. So these patients, as you say, will be admitted and will be monitored carefully. The on-target, off tumor effects that you'd be most interested in with this antigen, of course, are cardiopulmonary. So certainly, we'll be active monitoring. And if adverse events occur, they'll be treated with standard of care for whatever the adverse event. And then if standard of care fails, then they'll receive tensile and the small molecule activator of the safety switch in this construct.
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Operator [10]
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Our next question comes from the line of Kit Ma with Jefferies.
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Wai Kit Ma, Jefferies LLC, Research Division - Equity Associate [11]
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This is Kit. I'm on for Biren. I'm wondering what type of response can we expect with BPX-601 in the current trial. What will be the bar to move this forward into Phase II trial?
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Richard A. Fair, Bellicum Pharmaceuticals, Inc. - President, CEO & Director [12]
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Sure. Thanks, Kit. So it depends on the tumor type, of course. I think what we've said about pancreatic cancer is that you'd need to see something like a 15% response rate with a 6-month duration of response to be meaningful activity in the setting and be worth expansion in prostate cancer, probably a bit higher on the response rate, something more like a 30% to 35% response rate with similar durability to be a meaningful candidate to advance. So those are the thresholds that we're looking at.
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Operator [13]
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(Operator Instructions) Our next question comes from the line of Wangzhi Li with Landenburg.
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Wangzhi Li, Ladenburg Thalmann & Co. Inc., Research Division - MD of Equity Research of Biotechnology [14]
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Edited Transcript of BLCM.OQ earnings conference call or presentation 6-Aug-20 9:00pm GMT - Yahoo Finance
