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Edited Transcript of VBLT earnings conference call or presentation 15-May-19 12:30pm GMT

Q1 2019 Vascular Biogenics Ltd Earnings Call

OR YEHUDA May 16, 2019 (Thomson StreetEvents) -- Edited Transcript of Vascular Biogenics Ltd earnings conference call or presentation Wednesday, May 15, 2019 at 12:30:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Michael Wood

LifeSci Advisors - Biotech Investor Relations

* Dror Harats

VBL Therapeutics - CEO

* Amos Ron

VBL Therapeutics - CFO

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Conference Call Participants

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* Soumit Roy

Jones Trading - Analyst

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Presentation

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Operator [1]

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Greetings and welcome to the VBL Therapeutics First Quarter 2019 Earnings Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Mr. Michael Wood of LifeSci Advisors. Thank you. You may begin.

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Michael Wood, LifeSci Advisors - Biotech Investor Relations [2]

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Thank you, operator. Good morning and thank you all for participating in today's First Quarter 2019 Results and Corporate Update Conference Call. Leading the call this morning will be Dror Harats, CEO of VBL; and Amos Ron, the Company's CFO.

A press release with the Company's financial results became available earlier this morning and can be found on the Investors page of the Company's website at ir.vblrx.com.

Before we begin, I'd like to remind everyone that various remarks about future expectations, plans and prospects constitute forward-looking statements for the purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. VBL cautions that these forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those indicated. Any forward-looking statements made on this call speaks only as of today's date, that's Wednesday, May 15, 2019, and the Company does not intend to update any of these forward-looking statements to reflect events or circumstances that occur after today's date.

As a reminder, this conference call is being recorded and will be available for audio rebroadcast on the Company's website. As the operator mentioned, all participants are currently in a listen-only mode and there will be a brief Q&A session following the Company's prepared remarks.

So, with that, I'd like to turn the call over to Professor Dror Harats, CEO of VBL. Dror, please go ahead.

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Dror Harats, VBL Therapeutics - CEO [3]

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Thank you, Michael, and good morning. Today, we will discuss our first quarter 2019 financial results and operating highlights. Joining me on today's call is Amos Ron, our Chief Financial Officer. Today, we will focus on VBL's key highlights and expected catalysts.

I'd like to start with an update on VB-111, which will be the subject of two presentations at the upcoming ASCO Annual Meeting in early June. The first presentation by Dr. Richard Penson from Mass General will provide the final results of our Phase 2 VB-111 trial in ovarian cancer. The second presentation by Dr. Benjamin Ellingson from UCLA will detail MRI data from the VB-111 Phase 2 and 3 trials in recurrent GBM.

As ASCO data are still under embargo, we will not be able to share more information today, but we look forward to providing more details on these results in early June at ASCO and at the company presentation at the BIO Conference.

VB-111 has a dual mechanism of action within the tumor environment, targeting tumor vasculature and generating an anti-tumor-directed immune response. In simple words, VB-111 is not only starving the tumor from its blood supply, but also has the ability to turn cold tumors hot and thus enable the immune system to fight the tumor.

Ovarian cancer is classical cold tumor. Biopsy data from our ovarian cancer patients showed in three out of three biopsy patients that VB-111 recruited numerous T-cell into the tumor and induced a strong and durable immune anti-tumor response. This is very important since the cold tumor comprise the major oncology markets such as colon, breast, brain and many other solid tumors.

Even checkpoint inhibitors cannot do much if the immune cells are not there. Thus, turning cold tumors hot by VB-111 can be a major therapeutics game changer.

Based on this data, the reassessment of the GBM results, there is increased interest in the potential of VB-111 among the medical and scientific communities. This interest has led to the expansion of our VB-111 clinical program with two new trials that are expected to launch in the upcoming months.

The first is a Phase 2 investigator sponsored trial in collaboration with the National Cancer Institute in colon cancer in combination with a checkpoint inhibitor. The new study will test if driving with VB-111 can drive immune cells into the tumor and turn the colon cancer from a cold to a hot tumor. The addition of checkpoint inhibitor on top of VB-111 may further boost the anti-tumor immune response.

The second trial is an investigator sponsored randomized control trial in recurrent GBM, which will be conducted at top U.S. marrow oncology centers. These KOLs carefully examine the MRI data from patients treated with VB-111 and as I stated earlier, they are going to present their data and conclusions at the upcoming ASCO meeting. They believe that VB-111 should be further developed for the benefit of patients with recurrent GBM. We remain optimistic that this study will provide additional evidence for VB-111 activity in recurrent GBM.

It is important to note that VBL will own the study results and will be able to use these data in further filing. This study is currently in internal IRB committees and we look forward to seeing it start soon.

We are also pleased to report that our ongoing Phase 3 OVAL study in ovarian cancer is progressing as planned. The study utilized the same dosing regimen that was used in our successful Phase 2 trial in ovarian cancer whose final results will be presented at the upcoming ASCO Meeting.

We are now on track to have three VB-111 trials up and running in the second half of this year that will help us to fully realize the potential of VB-111 across diverse range of cancer indications where there is a major need for new therapies.

Beyond VB-111, we continue to advance our additional pipelines assets with focus on two parallel drug development programs targeting MOSPD2 for both inflammatory diseases and cancer. Although it's still early, the new biology we have discovered here is attracting both scientific and pharma attention.

In our third platform technology, the Lecinoxoids, we were pleased to announce in March a strategic, exclusive option license agreement with a world-leading European animal health company for our lead anti-inflammatory molecule VB-201, while keeping the worldwide rights for VB-201 for humans in-house. This collaboration has the potential to inject over EUR50 million to VBL in milestones and royalties over time.

Before I close, let me summarize our upcoming main catalysts. In two weeks time, we intend to present data on VB-111 at ASCO and provide a company overview at BIO. We look forward to launch two new investigator sponsored clinical trials for VB-111 in recurrent GBM and colon cancer in the near future. We expect interim analysis data in the potential registration OVAL trial of VB-111 in ovarian cancer around the end of the year.

I will now turn the call over to Amos Ron, our CFO to review the financial results for the quarter.

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Amos Ron, VBL Therapeutics - CFO [4]

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Thank you, Dror. Revenues in the first quarter ended March 31, 2019 related to VBL's collaboration amounted to $0.2 million. Research and development expenses net after government grants for the quarter ended March 31, 2019 were approximately $3.3 million, compared to approximately $5.7 million in the same period in 2018.

General and administrative expenses for the quarter ended March 31, 2019 were $1.3 million, compared to $1.4 million for the same period in 2018. VBL reported a net loss for the first quarter ended March 31, 2019 of $4.2 million or $0.12 per share, compared to a net loss of $7.2 million or $0.24 per share in the quarter ended March 31, 2018.

At March 31, 2019, VBL had cash, cash equivalents and short-term bank deposits totaling $47.7 million and working capital of $43.1 million. We expect that our cash, cash equivalent and short-term bank deposits will enable us to fund operating expenses and capital expenditure requirements through the end of 2021.

I will now open up the call for questions.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from the line of Soumit Roy with Jones Trading. Please proceed with your question.

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Soumit Roy, Jones Trading - Analyst [2]

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Congrats on the great progress so far. I wanted, just looking beyond platinum-resistant population in ovarian cancer, I was wondering if you have any anecdotal detail of platinum-sensitive patients who have been on PARP therapy or something and if they have been treated by VB-111?

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Dror Harats, VBL Therapeutics - CEO [3]

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Thank you, Soumit, for asking the question. The studies that we were doing in our Phase 2, which the final results they're going to be presented at the ASCO, of course, dealt with platinum-resistant and refractory ovarian patients. Most of the patients there were already a failure of PARP inhibitors and lot of them, actually about 50% were already failure of the anti-androgenic drugs like Avastin.

We never tried to combine this with a PARP inhibitor. Although, I believe that should be the next trial. We don't have an active compassionate or access program right now. So we don't have patients in platinum-responsive patients that are on PARP inhibitor. But definitely, after a successful OVAL trial, that will show that we can treat patients with ovarian-resistant and refractory patients. The next step should be adding VB-111 to a regimen of PARP inhibitors to patients that got into remission after treating with platinum chemotherapy. But that should be the next step in the development of VB-111 in ovarian.

Having saying that, later on, when we will progress and fully recruited patients, we might be able to open some access program to patients that will need this drug even if they are not platinum-resistant. But that's going to be further in line to where we are right now.

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Soumit Roy, Jones Trading - Analyst [4]

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Got it. Thank you. And trying to understand the reason behind going into colon cancer, I understand this is investigator run trial. But is there any -- have you seen any data or is there anything that drove them to go into colon and would have been -- and why not any other checkpoint responsive indications?

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Dror Harats, VBL Therapeutics - CEO [5]

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There are two ways to look at the development of VB-111 and we all understand that when and if successful, this drug is going to be a drug for many different solid tumors. Both the ones that hazard response to checkpoint inhibitors and of course, this will enable to increase the number of patients that will be response and to prolong the response time at least theoretically, because if we are bringing immune cells into the tumor, then the checkpoint inhibitors has a much better chance to work and it will be for a longer period of time.

So, I think that the combination with checkpoint inhibitor is indeed the right way to go and we already showed previously that in preclinical work, that combining VB-111 with checkpoint inhibitors actually give us very nice synergistic effect and in these trials we could show that basically checkpoint inhibitors didn't bring immune cells into the tumor. But VB-111 did bring the immune cells into the tumor and of course then the checkpoint inhibitors work better.

Having saying that, there is a major need in a very big market, which is the colon cancer where most patients because it's such a cold tumor, have a little chance if any to response to the new immune oncology drugs.

Seeing the data on the ovarian trial where we could see in patients in three out of three biopsies as I was saying, so in all patients that we biopsied so far that we can bring [fields] that are full of immune cells to a place where there were no immune cells and that's true in ovarian cancer, but ovarian cancer is very similar in that part to colon cancer, because both are really cold tumors. So, if we will see at this study with the National Cancer Institute, that we are turning the colon tumor into a hot tumor, then the next study, I'm quite sure or I think will be a study that we will be able to combine VB-111 with checkpoint inhibitor and maybe do a big study like that in collaboration with one of the companies that has checkpoint inhibitors.

Having saying that, I believe that in the future, even before we ended a OVAL trial, we might have more investigator initiated trials in different indications even as you suggested in patients -- in indications where checkpoint inhibitors works, but don't work well enough.

By the way, ovarian cancer is a good example because ovarian cancer is an indication where checkpoint inhibitors work in about 10% of the patients. It's not zero. It's between 10% to 15%, but that's not good enough. So, to patients who fail on our drug in the trial, they always have the option to then get checkpoint inhibitor and because we already brought the immune cells, some of them might show as that they will have a very nice response even when they are not anymore on VB-111.

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Soumit Roy, Jones Trading - Analyst [6]

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Got it. Thank you. And just one last question. The abstract to this -- the ASCO abstract, will we see like a fairly detailed data in terms of response rate or indications of that or it will be more placeholder abstract and we will see the detail in the presentation itself -- or is it going to be an earlier cut data at abstract and then a more later cut during the ASCO presentation?

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Dror Harats, VBL Therapeutics - CEO [7]

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Can you repeat the question please?

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Soumit Roy, Jones Trading - Analyst [8]

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Just trying to understand for the -- during the ASCO, the abstract released today, how much detailed data we are going to get in the abstract? Are we going to get response rate and those details or is it going to be an earlier cut data? And then during the presentation, June 3, we are going to see more updated details of data?

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Dror Harats, VBL Therapeutics - CEO [9]

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So, we all know that this evening the embargo on the abstract is going to be [released] and you will be able to read the abstracts. The abstract will show numbers and it's not an earlier cut. It's what the data are, but at the ASCO presentation you will get much more information and much more detailed information on patient-to-patient response and on a response to a -- or subgroup analysis that we were doing on the data of this final result.

I must say that always when a company presents interim analysis in a clinical trial where we look at survival, one hopes that the final results will actually follow and will show similar results. So in a way, it's boring, but it's very encouraging when it's boring, because the final results are actually the results of the trial and we had a successful and good interim results at the ovarian trial. And tonight, you will be able to read the results of the final Phase 2 in ovarian.

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Operator [10]

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Thank you. (Operator Instructions) There are no further questions at this time. I would like to turn the call back over to management for any closing remarks.

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Dror Harats, VBL Therapeutics - CEO [11]

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So, have a good day and thank you all for joining the call today. Thank you.

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Operator [12]

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Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation and have a wonderful day.