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Edited Transcript of PCIB.OL earnings conference call or presentation 28-Aug-19 6:30am GMT

Half Year 2019 PCI Biotech Holding ASA Earnings Call

Sep 6, 2019 (Thomson StreetEvents) -- Edited Transcript of PCI Biotech Holding ASA earnings conference call or presentation Wednesday, August 28, 2019 at 6:30:00am GMT

TEXT version of Transcript

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Corporate Participants

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* Per Walday

PCI Biotech Holding ASA - CEO

* Ronny Skuggedal

PCI Biotech Holding ASA - CFO

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Conference Call Participants

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* Pal Falck

Arctic Securities AS, Research Division - Research Analyst

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Presentation

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Per Walday, PCI Biotech Holding ASA - CEO [1]

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Good morning, everyone, and welcome to our PCI Biotech's Second Quarter and First Half 2019 Report Webcast. My name is Per Walday, I'm the CEO of PCI Biotech. I have with me also Ronny Skuggedal who is the CFO, and we have in the audience also the Chairman of the Board, Hans Peter Bøhn.

We will begin with the highlights for the first half 2019 and then follow that by a closer look at our 3 different development programs and after that an overview of financial figures and outlook for the coming year. After that, we will open up for questions from the room as well as questions submitted in through the web link.

So let's start with the highlights for first half 2019. fimaCHEM, our lead program, the first patient was enrolled into the RELEASE study in the first half. We have had regulatory and ethic approvals for the RELEASE study progressing very well, achieved in 2/3 of the planned countries that we will have totally in this is study including the United States. We have also now almost half of the RELEASE study sites opened and actively screening for patients. We have, in addition to that, initiated feasibility study in Asia since Asia is an area with the high prevalence of bile duct cancer where our prime program is with the aim of including sites next year. We have also, in the first half, completed the full Phase I study with a successful safety read-out for repeated treatment, which means that we do the pivotal study with up to 2 treatments. And in addition to that, we've been to key conferences for cholangiocarcinoma, for bile duct cancer, in the Asia Pacific and the U.S. and presented the Phase I data. So those are the main highlights for fimaCHEM, a very good operational progress in this program.

For fimaVACC, we've reached a major milestone in the first half. We had successful clinical proof-of-concept with enhanced immune responses in healthy volunteers. In addition to that, we also have, in the summer, had a preclinical publication in a high-impact immunology journal showing some features around what is the mechanism of action and how does fimaVACC really work when producing a good T-cell CD8 response.

For the fimaNAc program, our more collaborative program, we have had a promising first response on a patent application for mRNA delivery, which is very important for us, as a majority of our collaborations is within the mRNA field. We've also had an extension again in the top 10 pharma research collaboration, but now this time, that's a final extension. So this is the end after that of that specific agreement, of that specific research collaboration, and I'll come back to that.

And we have also, during the first half, further strengthened the Scientific Advisory Committee and the Board of Directors with people who have competencies that are prospectively important for the company going forward.

So first then, quickly, PCI Biotech at a glance. We are, as you know, a listed cancer-focused biotech company here in Oslo, Norway. The platform technology that we are developing is called Photochemical Internalization. It originates from the Oslo University Hospital, the Radium Hospital, here close to the site where we are located. And we are developing this program, this platform in 3 different programs: we call them fimaCHEM, fimaVACC and fimaNAc. And fimaCHEM is in pivotal development, a study -- in clinical study in bile duct cancer with registration intent. fimaVACC has completed a Phase I clinical study with good clinical results. And fimaNAc is a preclinical program, which is having a collaborative strategy with different companies that are developing nucleic acid therapeutics. It's really a nucleic acid therapeutics delivery technology.

Very quickly, the mode of action. I know that most of you have heard this before and know how this works, but there might be people out there on the Net or on the web or in the room that haven't heard this before so I'll do this very quickly, and if there are questions to the mechanism of action and so on, we can take them afterwards.

So all cells eat through a system baked -- as you call endocytosis and that's a way that they take in things into cells. But then they are trapped in the endosomes, in small capsules in cells. We have fimaporfin, a photosensitizer, patent photosensitizer, that locates specifically on the inside of these endosomes. And when they illuminate an area, a tissue, a disease area, with a specific light, these are activated. They react with this membrane in the endosome and the endosomes become leaky and whatever has been taken up into cells can leak out. So that's the basic mechanism on this platform technology, which we are then developing in 3 different areas.

Just to explain what these 3 different areas are. fimaCHEM is to take already approved cytotoxic agents, already approved agents on the market, and being able to enhance them locally. And this is within cancer, cytotoxics within cancer. So we can enable approved drugs to fulfill unmet local treatment need that they can't fulfill without this technology.

fimaVACC is a program where we develop this as a vaccination technology. And the point of doing that is that this specifically enhance cellular immune responses that are important for therapeutic effect of vaccines when you try to treat a disease with a vaccination.

And then the last area is fimaNAc. The last program is fimaNAc, which is in preclinical stage. This is focusing on nucleic acid therapeutics. Nucleic acid therapeutics is an area of great promise but with one major hurdle, and that is getting enough of these products into cells. And this is really a delivery solution for nucleic acid therapeutics. So we are working with companies that are developing these kind of drugs and see if we can use their -- they can use our technology to enhance the effect of their own products.

So that's the overview of PCI Biotech and the 3 different programs and the thought behind them. So now I'll go into each of these programs in some more detail. So as I said, fimaCHEM is about enhancing already approved, already used drugs, that are on the market to fulfill an unmet need that is there today. So what we can do then is we can take different kind of cytotoxic drugs and we can illuminate locally, and there, we can enhance the effect of these drugs. So if you have a cancer and you take a cytotoxic drug, we can illuminate the specific disease areas, specific tumor, and we can enhance the effect of that cytotoxic especially on that tumor where you want it to work most strongly.

What we then need is a disease with an unmet local treatment need, we need a disease that is treated with an agent that we can know that we can enhance and we need then a disease for the strategic fit with our technology where we can illuminate the tumor. And bile duct cancer fits all of those 3 parameters. So what we're focusing on is extrahepatic inoperable bile duct cancer. This is an orphan indication. It's a rare cancer, but it's a very deadly cancer unfortunately. Average survival of the inoperable patients are less than a year. The only cure, the positive -- possible treatment is surgery, but less than 20% or around 20% are actually operable at presentation.

So what is done with these patients then is they can't be operated. You need to make sure that the tumor doesn't block the bile drainage from the liver into the intestine because that is the most deadly part of this, the local effect of the tumor. So we then can -- what you do is you put in a stent to try to keep this open and you treat systemically with cytotoxic drugs. So what we can do then is to go in with a fiber optic and we can illuminate on the inside of this bile duct to treat the tumor where it's most dangerous. And we can do this through endoscopes.

Gemcitabine is what's being used today and we know that we can enhance maybe up to 5x gemcitabine in -- by using our technology. So then by applying PCI fimaCHEM into the bile duct enhancing locally where it's most needed, the effect of the cytotoxic drug maybe 5x. That's what the indication is from what we've seen preclinically.

So we enhance an active and recommended chemotherapy. We can easily relate -- illuminate through endoscopic procedures that are used in these patients standard and we can boost chemotherapy then where it's most needed because most of these patients die of the local effects.

We have done then a Phase I -- or a Phase Ib study because there was a first-in-man study done before this, a Phase Ib study in bile duct cancer where we've increased the doses of fimaporfin, the treatment -- fimaCHEM treatment in 4 different steps. And looking at those results in Cohort IV, the highest dose, we see a median overall survival of 21.7 months, and half of the patients in that cohort survived more than 30 months. One patient is still alive now by end June, more than 3 years after treatment. So this is really an astonishing result in -- but it's a very small group of patients.

Now we have also -- this is from one treatment. It's a single treatment of our technology. So what we wanted to do was to see whether we can actually repeat this treatment to get an even better effect because normally what you do with cytotoxic drugs is you repeat the treatment several times. So we did a study where we repeated the treatment approximately 3 to 4 months after the first treatment to see whether it was safe to do 2 treatments so we could include that into the pivotal study. A total of 7 patients were included here. Five of these 7 received 2 treatments. Four of these patients had radiologically measurable disease. And what turned out in this group was that the average tumor burden in the extension cohort was about twice the average in the dose escalation and in Cohort IV in the dose escalation. The interim median overall survival for all of the patients then receiving the pivotal dose is, by end of June, approximately 15 months. It's still an interim, but it can't go higher than 15.6 months. But this is including then a group of patients afterward in the extension that was dramatically more sick than the first patient group.

And looking at the tumor response, it's really dominated by significant target tumor reduction in the first 6 months. So this is the best response seen in the first 6 months with the target tumors that were identified at baseline. And you can see that there is an apparent dose-response relationship with the extension being slightly odd off because it's a very different group of patients from the other cohorts in the dose escalation. And why this is a different cohort? What's the reason for these patients being much more sick? We don't have a good explanation to that. It's probably coincidental because it's a big heterogeneity between the patients here and these are very small groups. So these are the kind of things that can happen when you use relatively small groups. What it's important to note that the tumor burden between the different cohorts in the dose escalation, all of those 16 patients, is approximately equal. So it's the extension cohort that is the odd outsider.

So summarizing this. The pivotal study is progressing well. We had our first patient included in May. Recruitment is progressing according to plan. We have achieved safety endpoint in the extension study, the RELEASE initiated now -- has been initiated now with up to 2 treatments. Regulatory and ethic approvals are progressing according to plan. By mid-August, we had approvals received for the U.S., which is important, of course, and 8 of the 11 planned European countries. That included Norway, Germany, France, Spain, Belgium, Poland, Sweden and Denmark. We're still waiting for Finland, U.K. and Italy. So those are the 3 remaining.

Site initiations progressing according to plan with a total of 15 sites across 7 European countries open for enrollment and actively screening for patients now by mid-August. It's been a lot of work over the summer of this PCI Biotech organization, the operational team. And I would like to use this opportunity to congratulate them on the good work that they've done actually because it's been a lot of work during the summer.

And then we have had presentation of Phase I data at the CCA Foundation in Salt Lake City at the Asia Pacific CCA conference in Taipei, in Taiwan and also the International Photodynamic Organization World Congress (sic) [International Photodynamic Association World Congress] in the U.S. in June 2019. We were -- I was present myself at the International Photodynamic Association World Congress in June where we were a sponsor of the meeting. We had separate seminar, which was very well attended and with a lot of questions and interaction with the audience. So there is a lot of interest in the technology.

Looking forward then, what are we doing? What is the pivotal study. It's a randomized study, 1:1, with an interim analysis for a potential accelerated approval. We have orphan designation by regulatory authorities, EMA and FDA, granted in both U.S. and EU. The fastest way to market has been determined through regulatory interactions with both of those agencies and this is the result of those interactions. We can, with this, become a first-line treatment of patients with inoperable extrahepatic bile duct cancer by doing randomization study of 1:1 with approximately 186 patients. The primary end point being progression-free survival and overall survival, of course, as a key secondary in this population which has very poor survival. And then potential accelerated approval through interim analysis of primary endpoints PFS, progression-free survival, followed by objective response rate. And we are planning to do this in approximately 40 key hospitals across Europe and the U.S.

Now I mentioned also that the prevalence of this disease in Asia is higher than it is in the Western world. So it is an area where we need to have a presence and where we can actually speed up recruitment. So we have a feasibility study ongoing in Asia to select the most appropriate RELEASE study sites for patient recruitment and market impact, and the aim is then to open sites in Asia as well in 2020. It's still in a feasibility study, so it's too early to talk too much about which countries and how many sites and so on, we'll have to come back to that one of the feasibility is done. But this is the aim: to open study sites in 2020. So that was fimaCHEM.

Moving over to fimaVACC, our therapeutic vaccination technology. Here, we use this technology locally with vaccines. So we can inject the vaccine into the skin together with our photosensitizer. We illuminate the skin afterwards, and thereby, in the immune cells that have been taken up these antigens, the vaccine, we can release it out from the endosomes and we could then, by doing that, influence the way these antigens, these vaccines, are presented to the immune system. And by doing that, we can enhance the more -- this MHC class I presentation would generate more disease specific cytotoxic T-cells and those cells then can attack cancer and virus-infected cells more efficiently. Those are the kind of cells you want, the so-called CD8 T-cells, are the kind of cells you want to really have a good therapeutic vaccine.

We have done a lot around the mechanism of this and we have collaboration with different national groups on this. We had one study published this summer showing -- giving further mechanistic understanding of fimaVACC, a preclinical publication in a high-impact immunology journal. We did it together with University Hospital Zürich and ETH in Zürich. And this shows that strong CD8 T-cell activation and tumor regression was seen after vaccination in melanoma-bearing mice even when they were knockout mice that did not have T helper cell function. So this works also without CD4 T helper cell function, which can be important in some -- I mean the most important thing about this is it sheds more light on the action and how it works, which is important in all the interactions you had with potential partners to really understand your technology, but it can also, in some settings, be important for patient treatment where you have patients who have less than optimal T helper cell functionality.

So we have also then done the main milestone for the first half, a clinical proof-of-concept, the achieved clinical proof-of-concept with this technology in a Phase I study in healthy volunteers. We've looked at safety, tolerability and immune responses of fimaVACC and what we see compared to control which is with a state-of-the-art adjuvant is that we get a substantial increase in the number of T-cell responders. So a number of subjects that respond to the peptides with a good T-cell response. We see clearly enhanced overall T-cell responses and also more robust CD8 T-cell responses, which are notoriously difficult to induce with E7, the E7 peptide which we have been using for -- or peptides from the E7 protein which we have been using for this vaccination. We also see in this increased functionality by the CD8 T-cells expressing more markers. And all of these are highly sought-after features especially for therapeutic vaccination, but also in some instances for prophylactic vaccination.

I've included some results. Just to show you the percent of HPV E7 responders for T-cells at the end of the vaccination schedule. And with increasing fimaVACC doses, we see an increase until we reach a plateau and it goes down again. It's a bell-shaped dose-response curve, which is not unexpected with a technology like this. We do see that we induced more overall T-cells so this is both CD4 and CD8, one we then compare with Hiltonol which is one of the adjuvants that are being used in a number of clinical studies to develop therapeutic vaccines today.

With regard to functionality, we also -- with regard to CD8 cells and their functionality and their expression, we see both that we have more robust expression of CD8 cells in the fimaVACC subjects, treated subjects, and we also see that they have an increased functionality. So more robust and higher number of polyfunctional. And polyfunctionality is an important feature showing to what extent these cells are actually effective in combating cancer cells and giving protection against viral infections. And this -- all of this work has been done in collaboration with our new SAC member, Professor Sjoerd van der Burg.

So we have solid progress of the fimaVACC program. The Phase I study provides successful clinical proof-of-concept. This is with intradermal dosing in humans. There are different ways you can dose, but this is with intradermal dosing. And we also see a positive overall characterization of tolerability, and we see that this is effective across a wide span of tolerable doses.

Now we are assessing the format and publication -- for publication and presentation of these results. I know that people want to know where they will be presented, and we will come back to that when that has been decided. But this will be presented during the autumn at, at least 1 high-impact conference.

Now the strategy for fimaVACC going forward. We have these results now, how are we going to use them? We are utilizing these results for direct partnering efforts and also to look whether we can go into a clinical proof-of-concept with these promising results in a disease setting to really prove that this actually has a benefit in patients in a specific disease.

And then, lastly, over to the fimaNAc program. This is, as I said, nucleic acid therapeutics. It's an area of enormous development and huge potential because what you do really is to utilize the effect of the DNA and the DNA machinery, how cells really regulate themselves, and you can affect it directly on the regulation of cells with nucleic acid therapeutics.

One big problem for all of these products is that they are -- they need to get into cells because otherwise they can't affect the regulation. And they are all big molecules, they need to be big molecules. So they have one major hurdle and that is actually getting into cells. But they're all taken up through endocytosis. And by using our technology, fimaVACC, we can release them from the endosomes and increase the uptake and the efficiency of these kind of agents.

It is important for us, of course, in a collaborative study like this -- or a collaborative program like this to have good patent protection for what we're doing and we are actively looking at how we can protect our technology. One of the latest patents that we have is on delivery of mRNA and we had recently then, what you call, an international search report and written opinion on that -- received on that mRNA delivery patent from the International Search Authority. So that's the initial feedback from the authorities on the patentability and what kind of claims you think you can actually get for a patent.

And this was very favorable. So it may give valuable intellectual property for fimaNAc mRNA delivery until 2039. And this is, as I said, and especially mRNA, not because -- which is one class of nucleic acid therapeutics, it's an emerging field with really massive investments and broad potential applicability.

Now as with the others and maybe more than with the others because these are really large molecules, sufficient intracellular delivery remains a major hurdle to realize this potential, and majority of the fimaNAc collaborations we have concern mRNA therapeutics. So this is a very important feedback from the International Search Authority for us.

We have also sent out a release on top 10 large pharma collaboration we had. That has now been extended to the end of 2019 and this is the final extension of this specific collaboration. So we've said that this can be done to complete the in vivo work that needs to be completed. But after that, we need to have a decision on whether this company is ready to go and take this to the next step or not. And we have allowed 6-month period for them after that to evaluate whether this is going forward.

We have 6 different collaborations ongoing. They are at different activity levels and are differing results. But the most important ones of these, I can say, that we have good progress and quite exciting results without being able to go in any more detail on that afterwards, okay?

And then I will leave the floor to Ronny to talk a little bit about the finances and corporate.

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Ronny Skuggedal, PCI Biotech Holding ASA - CFO [2]

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Thank you, Per. Yes, key financial figures. Other income meaning public grants for the year is in line with previous years, so we expect to be around NOK 10 million by year-end.

The operating result for the quarter and the first half year is more negative than previous years, but that's a result of the planned startup activities and the initiation of the RELEASE study. So it means that we have progress. So that's the important thing to note here.

We have a cash position at the end of 2016 -- '19 of NOK 300 million-plus. And I also made some small notes here that the cash position is impacted by currency fluctuations on euro deposits, which we have done to -- as a hedge of the ForEx currency risk for the RELEASE study program.

Then, a couple of words about the organization on the corporate level. As Per have said previously, we have strengthened the Scientific Advisory Board with Professor Sjoerd van der Burg, and he will strongly contribute to the fimaVACC program especially.

And the Board of Directors have been strengthened by the appointment of Hilde Furberg, and she will strengthen the Board with her commercial experience and expertise which will be important for the female chem program especially going forward.

Yes, over to you, Per.

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Per Walday, PCI Biotech Holding ASA - CEO [3]

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Thank you, Ronny. So then a list of key achievements and near-term milestones. Last year, we had the design of the pivotal study finalized and we had also a preliminary safety repeated treatment reported. We, in the first half, completed the Phase I immunoanalysis on fimaVACC.

And for fimaCHEM again, we confirm that repeated treatment is safe and the study, the pivotal study, was introduced or initiated with up to 2 treatments. And then in the first half again, we had the first patients enrolled in the pivotal bile duct cancer study.

Now looking forward, we are planning to have the first -- we are now -- we have the approvals in the U.S. and we are now doing the contract negotiations with the different sites in the U.S., which is what normally takes the longest time in that country. As you all know, there's a lot of contract things around U.S. Probably -- there's a lot of contract issues around U.S. and contract -- lawyer food you can call it maybe in -- specifically that area of the world. So that normally takes the longest time, but we hope to have our first U.S. patient enrolled in the pivotal cancer study this autumn.

For fimaVACC, as I mentioned, we will publish and present the results at a key conference during this autumn, and I will come back to what conference that is. We have not yet determined that, but it will be a high-impact conference. We are selecting this to be sure that we reach to the most -- reach out to the most relevant audience for this release.

And then without specifying half years yet because it's a bit too early, I wanted to at least guide that the first Asian patient enrolled in the pivotal bile duct cancer study will not be in 2019. It will be somewhere in 2020, and we'll come back to more details around that when we know which countries, how many sites and the contract plans around getting those sites opened.

And I think with that, we're finished with the presentation and we are now able to open up for questions from the floor and also taking questions through the web, which Ronny will monitor. So any questions?

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Questions and Answers

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Unidentified Analyst, [1]

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(inaudible). I know you said that you're doing a feasibility study in Asia. It's early days there. But do you think it's going to be more than one country involved in Asia?

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Per Walday, PCI Biotech Holding ASA - CEO [2]

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Yes.

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Unidentified Analyst, [3]

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Will you also be seeking a partner agreement for Asia?

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Per Walday, PCI Biotech Holding ASA - CEO [4]

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We are always looking around. I mean we've talked about this before that maybe the ideal thing would be to have a partner that take care of the development in that area. We have not landed something that would make this happen now. So we will -- and we can't sit and wait for that to happen because we need to have Asia into the study, and therefore we now started the feasibility study to ensure that we get them in. But that doesn't preclude going into a partnering agreement for that area. Was that understandable?

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Unidentified Analyst, [5]

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Yes. Assume this scenario, this size, potential size in Asia is going to have a significant impact on the enrollment rate for the RELEASE study. So it's probably going to impact when you think the study is going to be completed?

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Per Walday, PCI Biotech Holding ASA - CEO [6]

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Yes. I remember we will come back to that when we have the feasibility results, which talks about how many patient we can expect and how many sites that are interested and so on.

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Unidentified Analyst, [7]

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When you applied for a patent for fimaporfin, I guess you got a patent in many countries around the world. It seems like now we have applied for, I guess, patent in South Korea and Singapore. There was something I think last year or early this year, Per, that you have applied. Is that related potentially to this including sites in Asia that you do some protection, I guess, or whatever in connection with that?

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Per Walday, PCI Biotech Holding ASA - CEO [8]

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No. I'm not sure what you're talking about, to be honest. I think we'll have to come back to that. Normally, when we do a patent application, we go globally to all the different markets that are of interest and that includes South Korea and Singapore. But we haven't done anything specific for South Korea or Singapore in the recent time as I know at least.

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Pal Falck, Arctic Securities AS, Research Division - Research Analyst [9]

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It's Pal Falck from Arctic. First one, simple question. How many patients has been enrolled so far? And how will you communicate it in the future?

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Per Walday, PCI Biotech Holding ASA - CEO [10]

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So we have told that the way we will communicate around the pivotal study is how many country approvals do we have, how many sites do we have open and whether recruitment is according to plan or not. Next question.

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Pal Falck, Arctic Securities AS, Research Division - Research Analyst [11]

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Of course, it's early with the feasibility in Asia but I assume that Japan is one of those countries. And I know by experience that the Japanese regulatory authorities, they would like to have lots of local -- or Asian patients in the study to get sort of, in the end, the drug approved in Asia. Is that something that you have started communication with the authorities? Or do you have a plan to do that?

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Per Walday, PCI Biotech Holding ASA - CEO [12]

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No, we haven't started that communication. Japan is specific as you say. I mean they have very stringent rules and -- because Asia is quite difficult in relation to just putting them into a pivotal study with some Japanese patients and having an approval in that area. Normally, what they want to see is a Phase I and PK result specifically in Japanese population and so on. And those are things that are taken into consideration when we do the feasibility and then we will see how we handle that in the other end when we're finished with that.

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Pal Falck, Arctic Securities AS, Research Division - Research Analyst [13]

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Great. Okay. One last one, fimaBAC. What's the status on that?

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Per Walday, PCI Biotech Holding ASA - CEO [14]

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The status of fimaVACC?

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Pal Falck, Arctic Securities AS, Research Division - Research Analyst [15]

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BAC.

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Per Walday, PCI Biotech Holding ASA - CEO [16]

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BAC. It's the antibacterial thing?

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Pal Falck, Arctic Securities AS, Research Division - Research Analyst [17]

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Yes. It's popped up now lately.

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Per Walday, PCI Biotech Holding ASA - CEO [18]

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Well, it's not popped up from us. I'm not sure where it has appeared from, but there are research collaborations ongoing in a number of different fields for the use of PCI technology. PCI can be used for an enormous amount of different things, and we are focusing on 3 different programs: fimaCHEM, fimaVACC and fimaNAc. And antibacterial treatment for resistance is something that is possible to do. We know that from research, that has been done. And it might be something for the future, I don't know, but this is not something that we are reporting on anything today. So it's not a main priority of the company right now.

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Unidentified Analyst, [19]

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I have only 2 short questions. Does the company have any competition when it comes to screening of patients from other biotech companies?

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Per Walday, PCI Biotech Holding ASA - CEO [20]

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There is always competition for recruitment of patients either from investigative studies that academic centers are doing themselves because they want to publish specific results on new combinations that they're testing and so on and also, to some extent, on commercial companies that are developing drugs for -- generally for CCA. There is nothing specifically for our specific patient population, but there are umbrella studies that will include and compete for this.

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Unidentified Analyst, [21]

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Any concerns about U.K. sites in relation to an eventual hard Brexit?

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Per Walday, PCI Biotech Holding ASA - CEO [22]

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No. We don't -- we think that these kind of clinical trial things will not be affected to any large extent by Brexit -- by a potential hard Brexit.

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Unidentified Analyst, [23]

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(inaudible) Regarding fimaVACC. The clinical proof-of-concept, can you do this -- I mean how much money do you think it will cost to start this study?

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Per Walday, PCI Biotech Holding ASA - CEO [24]

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It all depends on how you do the study. So we're looking into a range of different possibilities for how to do this. You could either do it with an organization that partly funds this or completely funds this or you can do it by yourself completely as a sponsor study or you can do it in collaboration with someone. So it's anywhere between almost nothing. Nothing is free. So it's always a cost, but not very large cost to maybe NOK 40 million, NOK 60 million, depending on the indication and where you want to go. But this is not something we have concluded on yet where we want to go with.

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Unidentified Analyst, [25]

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Okay. Regarding fimaNAc, we have these partnerships to have interest from other companies on fimaNAc technology because I saw from Boston, you are very, I mean, ambitious and we can really see that this is technology that can be used in extremely many, many things.

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Per Walday, PCI Biotech Holding ASA - CEO [26]

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The short answer to that is yes.

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Unidentified Analyst, [27]

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You said that the research collaboration at fimaNAc was progressing well with the most important collaborations. And would you agree with me that the most important is the top 10 and then BioNTech and then Bavarian Nordic and the eTheRNA and Phio? Is that a good ranking?

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Per Walday, PCI Biotech Holding ASA - CEO [28]

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I would say that I would agree with you with #1, the top 10 pharma is the most important. Now the ranking between the others has to do more with just the size of the companies. It's also the fit and their strategic interest currently with that fit, so to speak. So I'm not going to prioritize all of these because it also changes to some extent during the collaborations.

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Unidentified Analyst, [29]

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I had a question regarding the recent patent application, which you also mentioned for mRNA delivery. In this, you included a third and generic type of photosensitizer for which you do not own the IP rights. Should this be interpreted as a signal -- or could this be interpreted as a signal that the photosensitizers for which you do own the IP rights might not be the best?

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Per Walday, PCI Biotech Holding ASA - CEO [30]

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There is -- I think, no, you shouldn't interpret it that way. What you normally do is when you do a patent around something, you include similar products and try to sort of give a slightly broader protection to -- so you can avoid this kind of me-too products coming in that are almost similar. So it's not that you think that something is better and therefore you have to make sure that no one else can develop it, it's just that you want to make sure that you protect as much of the space as possible. That's the way we do it. So we try to get the broad claims around areas where we think it is good to sort of have a protection.

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Unidentified Analyst, [31]

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So you expect to have that part of the patent approved as well, the [legal use of this photosensitizer]?

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Per Walday, PCI Biotech Holding ASA - CEO [32]

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We've had a good written opinion on this. So it's -- in the end all the different national reviewers that go through this that really determine what you get granted in different countries, but the first search authority report and the written opinion is quite positive.

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Unidentified Analyst, [33]

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The results from the fimaVACC study appears to be very good. You have a very competent Advisory Board. I assume there have been a lot of discussions between the management in PCI Biotech and the Advisory Board. Can you say something about the feedback that you got from the Advisory Board, particularly van der Burg, about the results?

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Per Walday, PCI Biotech Holding ASA - CEO [34]

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So I think it speaks for itself that he wants to be part of this company and be part of the Scientific Advisory Committee. I don't want to put words in his mouth. I have a quote from him that is sort of proof read. But generally, he says that E7 is notoriously difficult to induce any CD8 responses from. So this is promising, and really -- I'm looking for the word, really says that you should take this to the next level and see whether you can actually get a clinical proof-of-concept in a disease setting with this technology.

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Unidentified Analyst, [35]

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So Anders Høgset said he's going to give a presentation in Barcelona in end of October. Will he present -- will that be the result from the fimaVACC study or is he going to be -- van der Burg is going to present that at a different conference?

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Per Walday, PCI Biotech Holding ASA - CEO [36]

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So what Anders is presenting in Barcelona is the overview of fimaVACC and it will contain some presentation of fimaVACC results. This is the world congress for vaccination, so it's not specifically for oncology. It's more a conference covering normal vaccination, so to speak, with all the big and small vaccine players. But it's a technology that can be used in a number of different areas as well. So we think it is relevant to be present there and present the results there as well, but that is not where we'll give out the details. That's not the appropriate conference. We want a better conference in relation to oncology presence.

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Unidentified Analyst, [37]

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And the plan is still that van der Burg will give that presentation.

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Per Walday, PCI Biotech Holding ASA - CEO [38]

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That has never been the plan, so I'm not sure where that comes from, but he might be doing that. That's not been decided. I have never communicated that he will give a presentation.

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Unidentified Analyst, [39]

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The Chief Business Development Officer left the company in March, I think. Any news about his replacement?

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Per Walday, PCI Biotech Holding ASA - CEO [40]

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The only news I have there is that we've started a search for a replacement, and we hope to have that in as quickly as possible.

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Unidentified Analyst, [41]

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I think it was in February, you said that you will come back to the Asia strategy when that was ready. Now we have, I guess, talked about it today here. I guess, why haven't you, I guess, published information about this before -- while waiting, I guess, it wasn't decided just recently that you're going through, I guess, include sites in Asia, things like that? Why haven't there been any publication about this before?

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Per Walday, PCI Biotech Holding ASA - CEO [42]

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So at the last quarter report, when we stood here in Q1, that was not yet decided. So this is -- and this is nothing -- we don't send out the press release saying that we started a feasibility study. This is something that we normally inform on in quarter reports.

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Unidentified Analyst, [43]

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And regarding fimaNAc, you said there was more interest in this. Is there something that you will -- will you allocate more resources on the fimaNAc area from your side because it seems that this is coming up as a pretty important part.

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Per Walday, PCI Biotech Holding ASA - CEO [44]

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Yes. And that's a good and relevant question absolutely because as these collaborations progress and we get good results out of them and they potentially are converted into more sort of definitive agreement partnerships, we will need to put more resources into this, absolutely. And we have also done some work on the side, of course, of all the collaborations, especially for the specific patent that we have done now or a patent that was a specific piece of work that was done separately by us to make sure that we have good protection. So there are some activities but it's not a big resource drain right now. But it may come -- pick up depending on the outcome of some of those collaborations that we have ongoing.

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Unidentified Analyst, [45]

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Okay. Regarding fimaVACC, you said you are doing partnering here. This is -- what we are -- you're at least seeking partnering. Are you in some discussions with companies on fimaVACC?

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Per Walday, PCI Biotech Holding ASA - CEO [46]

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We are always in discussions with companies. We're very active.

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Unidentified Analyst, [47]

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Okay. You said also that this fimaVACC results will be presented in some kind of conference. Is this something -- can you choose wherever you want to go or...

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Per Walday, PCI Biotech Holding ASA - CEO [48]

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Yes. To some extent, you can. When you have very good results, you can [choose and plan].

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Unidentified Analyst, [49]

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That was what I wanted to know. Okay.

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Unidentified Analyst, [50]

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How to say this in a respectful manner? I believe that you guys, at some point in the near future, will become something close to rock stars in this milieu. But your visual identity still looks like a [garage] band. And I've heard rumors that you are working on the visual identity and branding of the company. Is this correct? And if so, when will we see any results of these efforts?

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Per Walday, PCI Biotech Holding ASA - CEO [51]

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So we are normally not guiding on branding of the company. But we are working on it, that is correct, and it will come shortly I think.

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Unidentified Analyst, [52]

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Great. I look forward. Is there -- well, the background is that from your stockholder overview, I see that most of them are Norwegian. Is there anything you are doing or can do to increase the amount of international capital to the company?

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Per Walday, PCI Biotech Holding ASA - CEO [53]

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Yes, and we are working actively on that in relation to going out and presenting at investor conferences and seeking to get interest from the players that are in the area of entertaining specific investors in life science. So there will be presentations and so forth going forward. And we will announce them as they get confirmed.

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Unidentified Analyst, [54]

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Just one last question. It's regarding partnering process because, as you said, you will probably go into discussion with the top 10 during next year. Will you do it yourself or will you use external consultants for this or how is that?

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Per Walday, PCI Biotech Holding ASA - CEO [55]

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We always use external consultants as advisers to the company, but we're not giving it out to someone else to do it, if that...

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Unidentified Analyst, [56]

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[No. That's the answer to that].

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Per Walday, PCI Biotech Holding ASA - CEO [57]

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Yes. I think we should look at whether there are any questions from the web as well. Are there anything there, Ronny, that hasn't been covered here in the room?

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Ronny Skuggedal, PCI Biotech Holding ASA - CFO [58]

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Yes, there is one question regarding fimaVACC and the next step. Will it be within a prophylactic vaccine or a therapeutic vaccine?

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Per Walday, PCI Biotech Holding ASA - CEO [59]

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It will most likely be within a therapeutic vaccine or it will -- 99.9% likely will be within the therapeutic vaccine. A prophylactic vaccine would normally take, if you're really going to have -- show that it works, you need to do really large studies with prophylactic vaccines. But there will maybe also be some opportunities to move into prophylactic vaccines, but I think the next study in all likelihood will be within therapeutic.

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Ronny Skuggedal, PCI Biotech Holding ASA - CFO [60]

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Thank you. And there is another question regarding the Phase I results in fimaCHEM regarding the average tumor burden. Can you say anything about how this correlates with the ABC and historic studies for bile duct cancer?

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Per Walday, PCI Biotech Holding ASA - CEO [61]

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Oh, wow. That's going into a lot of scientific details, really. I can -- I think I can mention that there was -- there is a way of staging bile duct cancer into 4 different stages, which is not very relevant for the prognostic outcome of these patients. And one of the foremost clinics in treating bile duct cancer, the Mayo Clinic, has produced a different kind of scheme for this. They've looked at the number of different parameters and have managed to make up a kind of -- or prepare a kind of staging scheme that fits better with prognostic values. And I think the most relevant to look at there is probably that because that really correlates very well with the survival of patients.

And looking into that, when we look at the extension study, half of the extension patients approximately, I think, are in the worst category in that specific study. That has been published a number of years ago, which was then retrospectively done on patients over a 10-year period, I think.

So there's -- looking into that staging system [where already] talked about prognostic between different patients, the extension group is much worse than the dose escalation group. The dose escalation group, most of the patients go into Stage III but half of them would be Stage IV in the extension I think. This hasn't been done formally and properly. I just had a quick look to try to see how this fits, but it looks like that. I think that's the best answer I can give on that.

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Ronny Skuggedal, PCI Biotech Holding ASA - CFO [62]

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Some would like a thorough answer. And then last question regarding fimaCHEM here. Are we looking for any abscopal effects?

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Per Walday, PCI Biotech Holding ASA - CEO [63]

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So when you're measuring these patients, you will measure for both new lesions and the growth of existing lesions. You will measure lesions that are in the area where you've illuminated and you will measure lesions that are outside of the area that you've illuminated. And then you will have randomized studies. So half of the patients will be in the control arm and half of the patients will be in the experimental arm. And therefore, you can get quite a good view on whether there's a difference in how the tumors that are distant from the illumination area are affected differently in the 2 different arms. So indirect, we're not saying that we're looking for abscopal effects, but indirect you will get the answer out of the study.

Okay? Thank you very much for interesting questions and discussion and for your attention.