AIM ImmunoTech - Q4 2023

Transcript

Operator (participant)

Hello, and welcome to the AIM ImmunoTech Fiscal Year 2023 Update Conference Call and Webcast. As a brief reminder, all participants are currently in a listen-only mode. If anyone requires operator assistance during the event, please press star zero on your telephone keypad. Following the presentation, there will be a question-and-answer session. Note that this webcast is being recorded at the company's request, and a replay will be made available on the company's website following the end of the event. At this time, I'd like to remind our listeners that remarks made during this webcast may state management's intentions, beliefs, expectations, or future projections. These are forward-looking statements and involve risks and uncertainties. Forward-looking statements on this call are made pursuant to the safe harbor provisions of the Federal Securities laws and are based on AIM's current expectations, and actual results could differ materially.

As a result, you should not place undue reliance on any forward-looking statements. Some of the factors that could cause actual results to differ materially from these contemplated by such forward-looking statements are discussed in the periodic reports AIM files with the Securities and Exchange Commission. These documents are available in the investor section of the company's website and on the Securities and Exchange Commission's website. We encourage you to review these documents carefully. Additionally, certain information contained in this webcast relates to or is based on studies, publications, surveys, and other data obtained from third-party sources and the company's own estimates and research.

While the company believes these third-party sources to be reliable as of the date of this presentation, it is not independently verified and makes no representation as to the adequacy, fairness, accuracy, or completeness of, or that any independent sources verified any information obtained from third-party sources. Joining us on today's call from AIM leadership team are Thomas Equels, Chief Executive Officer, and Dr. Christopher McAleer, Scientific Officer. I would now like to proceed to turn the call over to Mr. Equels. Please proceed, sir.

Thomas Equels (CEO)

Thank you, everyone, for joining us. 2023 was an extremely important year for AIM. We demonstrated progress resulting in significant advancements across our pipeline, showcasing a growing body of highly promising, consistent, positive data with our priority development programs. This data-driven progress drives our firm enthusiasm and belief in Ampligen's long-term potential in these many areas where we have shown clinical therapeutic value through the data. And these are not only unmet medical needs, sometimes lethal unmet medical needs, but also high-value indications, such as advanced local and metastatic pancreatic cancer, advanced recurrent ovarian cancer, post-COVID conditions of chronic fatigue and cognitive dysfunction. These are all important unmet medical needs that we're challenging.

On the corporate front, our positive data in oncology was the catalyst for us to engage Azenova, a specialized oncology business development firm, and that is to drive our licensing discussion using skilled experts in the field to engage the negotiation of potentially valuable relationships with qualified partners. We have a robust business development strategy for oncology involving our use of Azenova, and that process is now underway. Importantly, my mandate and strategic imperative for the company early on was to broaden and take steps to secure our patent estate for Ampligen, especially in oncology. As a priority, we successfully continued to do just that. You'll note that we had the issuance of a key U.S. patent, and that's where we were protecting our use of Ampligen in combination with PD-L1 checkpoint inhibitors, such as durvalumab, the AstraZeneca drug.

And we've also made tremendous progress in the clinic with Ampligen, combined with PD-1 checkpoint inhibitors. So we're trying to establish in many tumors, different tumor types and with different checkpoint inhibitors, Ampligen's ability to create synergy, sometimes massive synergies. Now, I believe that the clinical work that we do is very important, not only for our business development strategy, because for any potential future partner, clinical progress de-risks their investment, but also for our stockholders and investors to understand that all of this work also, you know, creates a foundation for long-term value. Through 2023, this time last year to now, we've had tremendous progress. This time last year, we hosted our inaugural earnings call, and quarterly thereafter, you know, we have engaged in similar efforts of updating and providing progress reports to our stockholders.

In 2023, we upgraded our website, and we've been extremely effective and active on social media channels. All of this demonstrates our commitment to good communication. Recently, we launched AIM's CEO Corner to provide a portal on our website to further discuss important topics for the company and areas of interest to you. If you have an interest, an area of interest you wanna suggest, contact our IR portal and give them your ideas on what we should be talking about on CEO Corner. We are all in this together. I'm a stockholder, too, and over the past several years, I have personally invested what I believe is a substantial amount of money in AIM.

I believe it is critical for management to stand shoulder to shoulder with our stockholders, and we will lock arms, working together to move this company into its next phase of growth, and what I believe is a phase that presents great opportunity. It is now my pleasure to turn over this discussion to our Science Officer, Dr. Chris McAleer. He'll give you a detailed update on our progress in the various clinical trials, and also, I hope, broaden your understanding of the mechanism of action of Ampligen, what it's doing in the immune system based upon recent data. Chris?

Christopher McAleer (Scientific Officer)

Thank you, Tom. Ampligen is a treatment for multiple indications, from locally advanced and metastatic pancreatic cancer to advanced recurrent platinum-sensitive ovarian cancer to long COVID, and I will take a few moments to briefly walk through some important aspects of our clinical portfolio. I will start with the study in advanced recurrent platinum-sensitive ovarian cancer ongoing at the University of Pittsburgh. I have had an opportunity to review the preliminary data that will be included in the interim report, and we will be releasing a statement in the very near future once the finalized report has been received. What I can say now is that based on the initial data, the safety profile is good. The objective response rate is better than the preliminary data that was reported in the April 2022 AACR abstract.

I do remind all shareholders that the data presented at AACR indicated that Ampligen, the Ampligen pembro containing treatment, had a 4-5 times greater objective response than that seen in the KEYNOTE-100 study of pembrolizumab alone in recurrent ovarian cancer, and the objective response rate being complete and partial tumor responses. The study has moved on to the second stage of the Simon two-stage design. The data is very promising, and recruitment rates have also accelerated post-COVID, so all of those are positives. Detailed data from the planned interim report will be disseminated in the upcoming press release. We reported positive top-line data for the AMP-518 post-COVID trial in February, and I have also recently reviewed the preliminary copy of the complete study report.

We are currently working with Amarex to finalize that report, at which time we will begin deep analysis of the data and use that information to help inform the design of the next trial. The post-COVID landscape is diverse, and information is continually being generated that helps refine the scientific community's understanding of the disease. The trial was designed to collect preliminary data to appropriately power the next trial, as well as understand and refine inclusion criteria for the design of a successful Phase 2 pivotal study. That analysis will likely take some time based on the over 32,000 pages worth of data listing, but I am optimistic that based on the preliminary review of the data, it is sufficient to design and power the subsequent trial.

Concerning our AMP-270 trial in locally advanced pancreas cancer, we are currently preparing for a Type D meeting with the FDA to discuss altering inclusion criteria for the IND protocol. If we are successful, it will expand the patient population that would be eligible for enrollment. I will speak further on this in the future after resolution of the Type D meeting. In the interim, we are still recruiting and opening new sites, and the current sites are still open for enrollment and are screening potential candidates. Hopefully, upon successful consultation with the FDA, the revised protocol will allow for faster recruitment of sites and patients in the U.S. Erasmus Medical Center in the Netherlands should be open for recruitment any day now, and we are engaged in conversations with other sites in the EU.

That brings me to the DURIPANC study, combining Ampligen and durvalumab as therapy post FOLFIRINOX. The phase 1 portion of the trial is a 3-in-3 escalation design, with fixed durvalumab dosing with escalating Ampligen dose. The first 3 patients of the 3-in-3 design have been enrolled already, and 2 patients have completed their Ampligen dosing and have received at least 2 durvalumab doses. The last patient, last Ampligen dose, is in mid-April, and thus far, there have been no reported adverse events. Once the patient completes the last Ampligen dose and finishes the prescribed monitoring period, which should be around the end of April, and assuming the safety profile is consistent as it has been thus far, we can escalate to the next dose.

That trial so far is going according to schedule, and if that continues, we expect the phase 1 portion to be completed in the summer of 2024. I lastly want to address the early access program in pancreatic cancer. Enrollment in this program will halt, as these patients should be enrolled in either DURIPANC or AMP-270. From this program, data was recently published in Clinical Cancer Research, and these data highlight aspects of the mechanism by which Ampligen exerts prolonged progression-free and overall survival in pancreatic cancer patients. These data were also part of the information used to design the DURIPANC study and what gave further confidence that Ampligen would work synergistically with the PD-L1 checkpoint inhibitor, durvalumab. With that being said, I'd like to take a second and look at Ampligen effects in various different solid tumors.

Ampligen works by binding to toll-like receptor 3, which are found on epithelial cells and immune cells in the body. Solid tumors in different parts of the body are similar in that they form from epithelial tissue, and therefore, these tumors express toll-like receptor 3. Our hypothesis has been that Ampligen will be an effective treatment in multiple solid tumor types because, one, it's binding to toll-like receptor 3 found in the solid tumors, no matter where that tumor might be in the body, whether it be pancreas, ovarian, breast, or otherwise. And two, the Ampligen binding to the toll-like receptor 3, 3 found on the surface of immune cells that are distributed throughout the body, including the tumor microenvironment. This chart shows different immune biomarkers, and these are markers of immune cell chemotaxis and dendritic cell or T cell infiltration in the tumor microenvironment.

This table might seem complicated, and so a more relatable analogy might be that Ampligen forces the tumor to make a 911 distress call to the immune system against its will, shown here in the table by increases in CXCL9, CXCL10, and CCL5. Subsequently, the immune system infiltrates the tumor and attacks it, shown by upregulation of Granzyme B and CD8 in this chart. This table shows that the phenomenon happens in multiple different solid tumor types we have investigated, and therefore, we believe that Ampligen has potential not simply as a treatment for one specific form of cancer, but as a treatment for many types. Importantly, I want to highlight that these immune-modulating properties, coupled with other biomarker data we have, suggest that Ampligen would have considerable synergistic effects with immune checkpoint inhibitors.

Our data in triple-negative breast and ovarian cancer confirm that hypothesis, and I believe this will be confirmed through the DURIPANC study for pancreatic cancer as well. I'd now like to turn the presentation back over to Tom Equels to discuss our key recent clinical and business milestones, as well as what to expect in the coming months.

Thomas Equels (CEO)

Thank you, Chris. I, too, am very excited about the opportunities that these clinical successes provide. This year, we've hit milestone after milestone. In 2023, we've followed a wave going back over two years of positive data, data published in top journals and abstracts at major meetings, especially in oncology. For Q2, we are planning for an action-packed quarter. Now, regarding our business development strategy, as I mentioned, we hired Azinova, and now we believe is the time to redouble our efforts with their help. The mandate for Azinova is to drive our process for conversations with targeted potential sponsors, partners, and create the value that comes in oncology from such deals. If you look, you'll see that the richest area of deal-making for biotech is in oncology. That's where the most deals are, and that's where the most money is. Business development takes time.

It begins with the creation of a sufficient database to support the discussion. That's where we're at now. From that point forward, the cycle from introduction to a potential partner to the negotiation of a valuable transaction doesn't just happen overnight or with a few conversations. It's a long-term process, taking months, sometimes a year or more. We do believe, however, that we have the right team and process in place to ensure we maximize the value of Ampligen. We also believe, and this is why we're taking this step at this time, is that these decisions by the bigger pharma companies to acquire rights in a drug, in an oncology drug, are data-driven decisions. And we are now sitting on data that allows us to have that discussion, and we have additional data coming in we think will amplify this point. Now, what are we trying to do?

There are a number of different things that are possible if we have an interested business partner, partnering, traditional partnering, co-development, licensing deals, even M&A opportunities might appear. We believe 2024 is an integral year for this process. We have the data, we have the team, and we intend to make important strides with our discussions with these potential partners over the course of this year. Now, let's take a look at our financial snapshot. The numbers are there, the details are in the 10-K that we just filed. But the important thing to take from this is we have the wherewithal to go forward with our programs for the next year and a half or longer. So this is, this is the, the answer.

You know, when you look at what you're seeing here, is we have the ability to continue our programs into the future, and we have important programs that are underway.... Now, Chris and I believe the future is bright for both AIM and Ampligen. The entire AIM team is behind us, driving this strategy forward. Our programs, our operational activities, and our clinical execution has been superb. We believe we will continue to deliver promising data across several important indications, all of which have the potential to create huge market opportunities. Now, all of this is done to drive forward AIM and Ampligen and unlock Ampligen's opportunity to provide therapeutic value. Our medical and scientific success, success, though, is not just good medicine.

I firmly believe that good medicine equals good business, and our strong clinical showings that we've posted over the past two years, as well as what we expect in the future, is a basis for driving stockholder value. Now, at this time, I'd like to open the floor for questions.

Operator (participant)

Thank you. We'll now be conducting a question-and-answer session. If you'd like to be placed into question queue, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing star one. One moment please, while we pull for questions. Our first question today is coming from Jason McCarthy from Maxim Group. Your line is now live.

Speaker 3

Hi, guys. Thanks for taking the questions. This is Chad on for Jason. So, for AMP-270, I was just wondering if you could give a bit more clarity on timing for first patient dosed. Is that... Do you guys think of that as a, you know, three-Q event, four-Q event? Anything that would be helpful.

Thomas Equels (CEO)

Well, we certainly have every expectation that in Europe, we will certainly by the end of the year have people not only enrolled but in treatment. That's not something we can say in the U.S. because there's a difference in the standard of care between Europe and the U.S. that seems to be affecting the ability to get full enrollment in the U.S., which is why we're having the meeting with the FDA. Can't go into the details of that ahead of time, but we hope with some amendments to the protocol to broaden the inclusion criteria, we'll also start to get the kind of U.S. candidates and subjects recruited and in treatment as well. Chris, would you like to talk to that a little bit and-

Christopher McAleer (Scientific Officer)

Yeah, Dee, the Type D meeting should be scheduled here shortly, and when we have that conversation with the FDA, it's about altering the inclusion criteria. The U.S. does things a little bit differently than Europe does in terms of how they treat patients with locally advanced pancreatic cancer. And, you know, we need to take that further into account. We understood that when the trial was designed, but perhaps to the extent that they want to include radiotherapy is a little more than expected. And so, you know, I assume that after the Type D meeting is over, I hope that the FDA will agree to the changes that we are to be made, and I think that will catapult enrollment in the U.S.

I expect enrollment in the E.U. to happen Q3, Q4-ish, by the end of the year for sure, and in the U.S. as well.

Speaker 3

Okay, great. Thanks for taking the questions, guys, and congrats again on the quarter.

Thomas Equels (CEO)

Thank you.

Operator (participant)

Thank you. As a reminder, that's star one to be placed in the question queue. Our next question is coming from James Molloy from Alliance Global Partners. Your line is now live.

Speaker 4

Hey, guys. Good morning. Thank you very, very much for taking the questions. I had a question sort of on the investigator-sponsored trials. You've got a variety of, you know, metastatic prostate, triple-negative ovarian cancer, a variety of ISTs ongoing. I know they're outside of your control, but would any insight you could give us into when you think we might be seeing some potential data on any out of any of those ISTs?

Thomas Equels (CEO)

Well, we have every expectation of getting the formal interim report on the advanced recurrent ovarian cancer phase 2. That's the program that was started in Pittsburgh with a Merck grant, and combining Ampligen with Pembrolizumab, to see if it improved the therapeutic efficacy over and above what Pembrolizumab alone was able to do. That should be extremely positive data because we've seen preliminary data come in consistently positive and showing you know, a massive increase in therapeutic impact, especially with regard to ORR. So, I think that's gonna be very powerful. These investigator-sponsored trials are extremely important because while we're supplying the Ampligen and everything, it...

For the most part, the big part of the expenses in those trials is covered by various grants, either industry grants, or governmental grants, typically. Does that answer your question?

Speaker 4

It does. Thank you very much. And then, on the 518, I know the final data set is gonna be coming out here second quarter. What additional learnings you just been getting, I know that with the unfortunate data back in February, what additional data are you hoping to sort of parse out of the final data set that potentially going forward, if does it go forward, for 518?

Thomas Equels (CEO)

Well, the data we received in February had a lot of very positive points in that top-line report. The complete data set has come in, but I think it's, you know, tens of thousands of pages. So our ability to, you know, do that analysis will take some time, but it's underway. I'll turn this over to Dr. McAleer for any, you know, detailed comment. Chris?

Christopher McAleer (Scientific Officer)

So the complete study report will have breakdown of all the secondary endpoints that weren't part of the top-line data, and we've seen those, and there are positive improvements in quite a few of those. It also give us the individual data points for a statistical analysis and power analysis to be done. I'm also hoping that we have to wait for the biomarker analysis to come in, but it's clear from the initial review of the data that there are responders and non-responders, as we would expect. And, you know, the understanding of the inclusion criteria and the initial baseline data of those individual patients who responded versus or not, will give us an indication of how we wanna design the study in the future.

Secondary to that, you know, I remind everyone that, you, the landscape of post-COVID and how you use statistical analysis and standard deviation to power the study didn't necessarily exist for us. So we chose 80 patients as a clinical judgment, right? And that data is used now to power the study appropriately. If even the data that currently exists, I believe, powered properly, would have given us statistical significance over the course of the study, as the data would suggest. There are improvements in both cognitive function, fatigue, six-minute walk test, and sleep as well in these patients. And so I believe the data will give us enough information for us to design the trial to be successful at with high level of power for the next trial.

Thomas Equels (CEO)

If I might just add, you know, the point of this was, it was called a proof of concept because of the small number of subjects. 80 subjects is a very small phase 2, and it's usually designed for exactly the purpose that we've just articulated. But what we intend to do is take that data and refine our inclusion criteria so that we're focused on bringing subjects into this trial, this follow-up trial, that we have high confidence that we've targeted the zone of Ampligen responders.

And much of that's gonna be based upon the onset of disease, and we believe that, the longer they've had post-COVID chronic fatigue-like symptoms, the more likely we'll see statistically significant responses, especially with severe disease, which is much, you know, easier to measure, than people with, mild or moderate disease. So, Chris, anything you wanna add to that? And we'll just see if Mr. Molloy's-

Christopher McAleer (Scientific Officer)

No, I think that sums it up.

Thomas Equels (CEO)

And does that answer your question, Jim?

Speaker 4

It does, indeed. And no calling me Mr. Malloy, now. I appreciate it. And I guess the last question, housekeeping, G&A, pretty high. I see in the, in the K, you guys talking about the $6.5 million in legal expenses you had to spend, in the year. I presume you don't anticipate, hopefully, that, that same level of G&A with legal expenses going forward in 2024?

Thomas Equels (CEO)

Well, we hope that we don't have those expenses again for 2024. We've, in the Chancery Court, defeated this group on, I think, related group from on three separate occasions. It's up in the Delaware Supreme Court right now after our last trial. We have to take a stand, though, if it's this particular group, because as the Chancery Court, in one of its orders related to the second attack with Jorgl, that this whole thing was orchestrated by a securities law felon, and then the payment and funding of it was managed by another financial fraudster, convicted felon. So you can't allow that to go forward without addressing those issues.

Speaker 4

Thank you. Thank you for the questions.

Operator (participant)

Thank you. Next question is coming from Ed Woo, from Ascendiant Capital Markets. Your line is now live.

Speaker 5

Yeah. Congratulations on all the progress that you're doing. My question is: the COVID landscape has changed significantly, obviously, as we move further and further away from the initial start of the pandemic. Can you talk about the market opportunity for long COVID today?

Thomas Equels (CEO)

Certainly, Mr. Woo. We've got a situation in the United States that is ever increasing in terms of its social impact. We're looking at millions of Americans that are expected to have serious post-COVID chronic fatigue-like conditions, which is post-exertional malaise, debilitating fatigue, cognitive dysfunction, sleep interruption, and severe joint pain. So that that's a disabling disease that's ever-growing, and it's I believe right now estimated at about 4 million potential persons that will suffer from this going forward in the United States alone. That number is exponentially higher worldwide, of course.

Speaker 5

Great! Well, thanks for answering my questions, and I wish you good luck.

Thomas Equels (CEO)

Well, thank you very much. We really appreciate your interest.

Operator (participant)

Thank you. We've reached the end of our question and answer session. Ladies and gentlemen, that does conclude today's teleconference and webcast. You may disconnect your lines at this time and have a wonderful day. We thank you for your participation today.