Q2 2023 Cyclacel Pharmaceuticals Inc Earnings Call
Participants
Grace Kim
Mark H. Kirschbaum; Senior VP & Chief Medical Officer; Cyclacel Pharmaceuticals, Inc.
Paul McBarron; Executive VP of Finance, CFO, COO, Secretary & Executive Director; Cyclacel Pharmaceuticals, Inc.
Spiro George Rombotis; President, CEO & Executive Director; Cyclacel Pharmaceuticals, Inc.
Ahu Demir; MD & Senior Research Analyst; Ladenburg Thalmann & Co. Inc., Research Division
Brian Kemp Dolliver; Director of Research & Senior Biotechnology Analyst; Brookline Capital Markets, LLC, Research Division
Jeffrey Michael Jones; Research Analyst; Oppenheimer & Co. Inc., Research Division
Presentation
Operator
Good afternoon, and welcome to the Cyclacel Pharmaceuticals' Second Quarter 2023 Results Conference Call and Webcast. (Operator Instructions) Please note, today's call is being recorded. I would now like to turn the conference call over to the company. Please go ahead.
Grace Kim
Good afternoon, everyone, and thank you for joining today's conference call to discuss Cyclacel's financial results and business highlights for the second quarter of 2023.
Before turning the call over to management, I would like to remind everyone that during this conference call, forward-looking statements made by management are intended to fall within the safe harbor provision of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934 as amended.
As set forth in our press release, forward-looking statements involve risks and uncertainties that may affect the company's business and prospects, including those discussed in our filings with the Securities and Exchange Commission, which include, among other things, our Forms 10-Q and 10-K.
All of our projections and other forward-looking statements represent our judgment as of today, and Cyclacel does not take any responsibility to update such information.
With us today are Spiro Rombotis, President and Chief Executive Officer; Paul McBarron, Executive Vice President, Finance and Chief Operating Officer; and Dr. Mark Kirschbaum, Senior Vice President and Chief Medical Officer. Spiro will begin with an overview of our business strategy and progress. Mark will provide details on Cyclacel's clinical programs, and Paul will provide financial highlights for the second quarter of 2023, which will be followed by a Q&A session.
At this time, I would like to turn the call over to Spiro.
Spiro George Rombotis
Thank you, Grace, and thank you, everyone, for joining us today for our quarterly business update. Both clinical programs with fadraciclib, or fadra, and plogosertib, or plogo, are progressing well, and we are on track to deliver key data readouts over the coming months. We expect to report complete dose escalation data with fadra and the termination of the recommended Phase II dose, or RP2D, and in the plogo study, dose-escalation data and further elucidation of its novel epigenetic mechanism.
In the fadra 065-101 study in patients with solid tumors and lymphoma, our immediate task is to determine the recommended Phase II dose, or RP2D, and we're very close to achieving this goal. Pharmacokinetic and pharmacodynamic data from the initial patients at this dose level suggests that we are achieving level above the predicted target engagement levels on our daily dosing.
In addition to choosing RP2D, another parameter that may increase the chance of success in Phase II is the selection of the histologies in which we may expect to see anticancer activity. As previously reported, we have seen PRs and stable disease in patients with T-cell lymphoma; women's cancers, including cervical, endometrial and ovarian; and also pancreatic cancer, all on fadra monotherapy. Our Phase II sites have been selected with this in mind, and they are ready to participate once we declare RP2D and elect to start the Phase II proof-of-concept or POC stage of the study. Clinical data from this open-label POC stage will be reported as they become available.
Based on the totality of data collected to date, we believe that fadra's CDK2/9 profile is differentiated from other molecules in its class in terms of safety and anticancer activity reported thus far. Of note, a competitor recently disclosed that after a strategic portfolio prioritization, they have discontinued preclinical trials of their AZD4573 candidate. AZD4573 is a CDK9 inhibitor administered intravenously once a week.
We believe that continuous pressure on CDK2 and CDK9 targets is required to enable apoptosis. Accordingly, fadra is a CDK2/9 inhibitor administered by oral tablets on a daily schedule.
Let us now turn to plogo. We are very excited that plogo could emerge as a PLK1 inhibitor with novel epigenetic activity. In our 140-101 study, we are evaluating plogo in escalating doses, now at dose level 5, as a treatment for patients with advanced solid tumors and lymphoma. Plogo has shown early signals of anticancer activity at low concentrations in patients with adenoid cystic carcinoma, biliary tract, non-small cell lung and ovarian cancer.
Our preclinical program, aiming to elucidate plogo's differentiated biological profile, has revealed novel epigenetic activity at low concentrations. If further data corroborate with findings, we may enroll in the future one or more patient cohorts selected on the basis of specific biomarkers.
I will now turn the call over to Dr. Mark Kirschbaum, our Chief Medical Officer, to provide details on recent clinical data. Mark?
Mark H. Kirschbaum
Thank you, Spiro. As you heard, both the fadra and plogo clinical programs are accruing well and are important stages in their respective studies.
Regarding fadra, we are completing enrollment at dose level 6A and expect to shortly select the RP2D. Of note, we are now dosing all patients using the oral tablet form of fadra, which may eventually support a commercial launch.
I would like to summarize what we have seen recently in the 065-101 study. A patient with heavily pretreated endometrial cancer in dose level 6A had documented tumor shrinkage after one cycle and is ongoing.
We previously reported that 2 out of 3 patients with T-cell lymphoma achieved PR, including a patient with a very aggressive angioimmunoblastic form of peripheral T-cell lymphoma. 13 of 19 patients with cervical, endometrial, liver and ovarian cancers achieved stable disease with target lesion reductions as their best response. A pancreatic patient maintained stable disease for 5 cycles of treatment. These are promising responses for this phase of clinical testing and may predict deeper responses in Phase II.
The major toxicities we have seen thus far continue to be nausea and hyperglycemia, which were manageable and reversible. The primary objective of the Phase [II] stage that follows determination of RP2D is to assess fadra's activity and safety in relevant tumor types. The design of this registration-directed study allows us to recruit different tumor types and discrete cohorts, each running in parallel and independently of each other.
Let's now turn to plogo, our oral PLK1 inhibitor. In the 140-101 study of plogo in patients with advanced solid tumors and lymphoma, we have observed intriguing clinical activity at these early low-dose concentrations given continuously. These included stable disease at dose level 1 and 2 patients with non-small cell lung cancer for 8 cycles and ovarian cancer for 5 cycles, at dose level 2 in a patient with biliary tract cancer for 3 cycles and at dose level 4 in a patient with adenoid cystic carcinoma for 3 cycles. We are currently enrolling dose level 5. No SAEs have been reported thus far.
Preclinical data have shown that plogo has had a genetic mechanism. Term epigenetics refers to the way cells control gene activity without changing DNA sequence. Approved drugs with epigenetic mechanisms such as histone deacetylase inhibitors or hypomethylating agents typically work at low concentrations as opposed to chemotherapy and other traditional forms of cancer therapeutics. We are actively investigating this potential epigenetic mechanism in the preclinical setting as well as in our clinical correlative studies.
The 140-101 study is designed to target several important tumor types with preclinical models and biology suggest possible single-agent activity. These include colon, lung cancer and lymphoma. Our study is designed to efficiently evaluate both dose and schedule to optimize RP2D for the proof-of-concept or cohort stage of the study. We look forward to updating you as we progress our evaluation of fadra and plogo.
I will now turn the call over to Paul to review our second quarter and financial results.
Paul McBarron
Thank you, Mark. As of June 30, 2023, cash equivalents totaled $10.2 million, compared to $18.3 million as of December 31, 2022. Net cash used in operating activities was $8.2 million for the 6 months ended June 30, 2023, compared to $8.7 million for the same period of 2022. The company estimates that its available cash will fund currently planned programs through the end of 2023. However, the operating plan includes discretionary expenditures, which, if not incurred, could extend our liquidity requirements into the second quarter of 2024.
Research and development or R&D expenses were $4.7 million for the 3 months ended June 30, 2023, as compared to $4.2 million for the same period in 2022. R&D expenses relating to fadra were $3 million for the 3 months ended June 30, 2023, as compared to $2.6 million for the same period in 2022 due to increase in nonclinical expenditures. R&D expenses related to plogo were $1.4 million for the 3 months ended June 30, 2023, as compared to $1.5 million for the same period in 2022 due to clinical trial costs associated with the progression of the 140-101 study.
General and administrative expenses for the 3 months ended June 30, 2023 and 2022 remained relatively flat at $1.6 million. Total other expense, net, for the 3 months ended June 30, 2023, was $0.1 million compared to an income of $0.2 million for the same period of the previous year.
The United Kingdom research and development tax credits for the 3 months ended June 30, 2023, were $0.6 million, compared to $1 million for the same period of the previous year due to a decrease in the tax credit rate that took effect in April of this year. Research and development tax credits are directly correlated to qualifying research and development expenditure. Net loss for the 3 months ended June 30, 2023, was $5.4 million, compared to $4.6 million for the same period in 2022.
Operator, we are now ready to take questions.
Question and Answer Session
Operator
(Operator Instructions) Our first question comes from Ahu Demir, Landenburg.
Ahu Demir
(inaudible) on our side. First one would be given the recent developments and needs in the PLK1 field this week, could you elaborate more on the differential profile of plogo compared to other PLK1 inhibitors? I know mechanism of action will be disclosed later in time, but just curious however much you can disclose and mention some details to us.
Spiro George Rombotis
Thank you for your question, Ahu. That's an excellent question. There are 2 clinical stage PLK1 inhibitors, as you mentioned. The difference between plogo and the other candidate is that we have an epigenetic mechanism as evidenced by cross reactivity with BRD4, a validated epigenetic target, whereas the other molecule does not.
Very importantly, our molecule has presumed single-agent activity, which we have seen in several patients. At the same time, we believe that the other molecule has never been tested in a single-agent protocol. It's always been tested in combinations.
Lastly, the developments of this week relates to a change in clinical trial plan to [gather] molecule in front line of colorectal cancer. This is certainly a cancer of interest to us as is the potential care as mutation, but that is only a part of the story that will emerge when we disclose the full details of plogo's epigenetic mechanism.
Last point I have (inaudible) consider here is that both of these drugs are given orally. We have a potential best-in-class half life of around 11 hours versus about 24 without the molecule. We believe both molecules have a chance to make it to market, but we believe on different indications based on the very different biological functions.
Ahu Demir
And a follow-up question would be what -- are there any indications that you see a greater efficacy of plogo when you're trying in the clinical trial?
Spiro George Rombotis
Well, it's still early days. As I think Mark reported, we have seen activity in 4 different tumor types in about a dozen or so of patients so far. These are adenoid cystic carcinoma. Obviously, non-small cell lung cancer, which is very exciting given the importance of this market to any oncology new drug and also in ovarian and biliary tract cancers.
So women's cancers remain of great interest to us for the reasons that we have seen before in this class as is the potential for activity in lung. We have not had any colorectal patients enrolled so far. That may change and that, of course, will change our picture.
We believe also bladder cancer is sensitive to PLK1 inhibition and possibly triple-negative breast. So it remains a story to unfold. But of course, what may matter here is that if the epigenetic mechanism of plogo is fully corroborated, we could be able to enroll mutationally selected patients. In other words, choose patients based on the mutation that is driving the tumor and enroll a specific cohort with this type of patient profile. That can sometimes be tumor-agnostic, regardless of the tumor tissue in which the tumor originated (inaudible) enroll patients only because they have a mutation. More on that in the next quarter as the story fully unfolds.
Ahu Demir
Makes sense, Spiro. And my last question will be, when should we expect any efficacy data from any of the programs, fadra or plogo? What does the time line look like?
Spiro George Rombotis
Well, the first report that we mentioned will be the full Phase I results for fadra in the 065-101 study, which should come by the end of this year, possibly a bit sooner. You should be aware that there are extensive preclinical data being worked on by collaborators of Cyclacel and the company itself that will complete the story of fadra as it unfolds in the clinic prior to us beginning Phase II, which we're ready to go at this moment as soon as the last patients complete follow-up.
In the case of plogo, we will disclose the mechanism towards the end of this year. We expect data at the beginning of summer, but of course, we need to have additional confirmation by sets of sponsored studies, which are in progress, and expect to have the first clinical results for plogo early next year, conservatively assuming would take us at least 2 or 3 more cohorts before we complete those escalation. So both of these products will have a data flow over the next 2 to 4 quarters.
Operator
Our next question comes from Jeff Jones, Oppenheimer.
Jeffrey Michael Jones
Just a couple of follow-ups to Ahu's on fadra. I just wanted to confirm, for the dose level 6A that you need to call your RP2D, do you have 6 patients enrolled at this point? And how long does it take from enrollment to be able to call RP2D? And then from there, what does timing look like to start the Phase II POC study?
Spiro George Rombotis
Thank you for your question, Jeff. Let me ask Dr. Kirschbaum to answer the first part of the question, Mark. And then I'll come back and talk about Phase II on my complete response to your question.
Mark H. Kirschbaum
Sure. We have -- the last 2 patients are consented and are expected to start any day now.
Spiro George Rombotis
So the time to achieve RP2D, Mark? What is the time of follow up with protocol that Jeff asked?
Mark H. Kirschbaum
So technically, the DLT period is 1 cycle. So if they get through 1 month in terms of safety, we could declare it. We'll still be following them for activity. Obviously, 1 month would be early for that. But the safety part of it is 28 days.
Spiro George Rombotis
Thank you, Mark. Jeff, your second question was when will we start Phase II. Obviously, one prerequisite is declaration of RP2D, as Mark explained. The other one is corporate initiatives underway to pursue both balance sheet and strategic options available to the company right now. We obviously faced a challenging capital markets environment, but there's a lot of (inaudible) in both of our drugs, which the company is to explore to understand alternate, but to create stockholder value. So all of this parameter playing into the decision to start Phase II, and as explained in his section of the prepared remarks, this decision that our Board will make towards end of Q3.
Jeffrey Michael Jones
Okay. Great. Just one follow-up. You mentioned presenting the data on the dose escalation in the lymphoma solid tumor patients. So the totality of the Phase I data towards year-end. Are you thinking about that at a conference? Or a company-sponsored event to walk through all that data? How are you thinking about that?
Spiro George Rombotis
We'd like to do all of the above. Obviously, (inaudible) deadlines passed us for some of the conference at year-end like Antonio or have you, therefore, we'll have to -- company announcement first with submissions for early (inaudible).
Operator
Our next question comes from Kemp Dolliver, Brookline Capital Markets.
Brian Kemp Dolliver
So with regard to discretionary spending, given where you are with the likely timing of data and your resources, what's the dollar amount of discretionary spending you're talking -- you're thinking about when you talk about extending the runway into second quarter?
Spiro George Rombotis
I think this one is for Paul. Thank you, Kemp.
Paul McBarron
Thank you, Kemp. Thanks, Spiro. So I think that the -- what we would look at clearly is uncommitted expenditure at the moment, and that's what we (inaudible) by discretionary. I think the important fact is that by limiting some of that committed spend, it allows us to bring in, in the early part of 2024, Kemp, about $3.5 million of the U.K. R&D tax credit. That's a significant cash flow into the company, which allows us to then extend into that Q2 2024 number that I mentioned in our prepared remarks.
Brian Kemp Dolliver
Got it. And not to focus too much on this, but fadra still looks like the more interesting program over plogo, if you had to make a choice. Is that fair?
Spiro George Rombotis
That is a fair question, almost as far as asking a parent, which of the 2 children they like the most. It's certainly the most advanced and has the most clinical data, and it's an active compound with an excellent safety record. As we said in our prepared remarks, we had actually 2 competitors who seem to have lost momentum if not terminating programs in the next-generation CDK field, but in our opinion, increase fadra's scarcity value and potential, exit value for stockholders.
The other dimension of your question, Kemp, that we should bring to the attention of investors that there is a lot of interest in these compounds from strategics, as our interest can manifest itself in various corporate developments as well as alignments. Obviously, we need to explore those in due course in parallel to other initiatives, and that will dictate which molecule could come forward the fastest.
For example, if we were to theoretically out-license fadra, we could develop plogo with non-diluted funding coming from fadra or the opposite. If parties became as excited as we are about the mechanism of action of plogo, the inverse could happen and therefore, non-diluted capital from plogo transactions could support fadra. So we are committed to taking both drugs forward at this time given the spend is relatively modest to get to the end of Phase I for plogo and to get fadra Phase II ready. So I hope you understand that the company is exploring all available avenues to maximize stockholder value in this difficult time in the capital markets.
Operator
We have no further questions in the queue at this time. I would now like to turn the call back over to today's speakers.
Spiro George Rombotis
Thank you very much, operator, and thank you, everybody, for joining us today for our quarterly earnings call. Both of our programs are approaching important catalysts with a strong competitive profile in the therapeutic classes.
As a reminder, our upcoming key milestones for 2023 are: Report final data from dose escalation stage and RP2D determination on the 065-101 study of oral fadra in patients with advanced solid tumors and lymphoma; first patient dosed with oral fadra in Phase II proof-of-concept study of 065-101 in patients with advanced solid tumors and lymphoma; report Phase I data from 140-101 study of oral plogo in patients with advanced solid tumors and lymphoma; and elaborate novel mechanism of action of plogo. We look forward to providing you with further elements, and I hope to meet you at upcoming conferences. Operator, at this time, you may end it.
Operator
This does conclude today's program. Thank you for your participation. You may disconnect at any time.
