Cellectar Biosciences - Q3 2023

Transcript

Operator (participant)

Good morning, and welcome to Cellectar Biosciences' Third Quarter 2023 Update Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Monique Kosse of LifeSci Advisors. Please go ahead.

Monique Kosse (Managing Director in Investor Relations)

Thank you, Operator, and welcome everyone. This morning, Cellectar issued a press release providing a corporate update. You may access that release on the company's website under the Investors tab. With us today are Jim Caruso, President and CEO of Cellectar, Chad Kolean, Chief Financial Officer, Jarrod Longcor, Chief Operating Officer, Shane Lee, Chief Commercial Officer, and Andrei Shustov, VP Medical.

Following our prepared remarks, we will open the call for a Q&A session. Before we begin, I would like to remind everyone that statements made during this call, including the Q&A session relating to Cellectar's expected future performance, future business prospects, or future events or plans are forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995.

Although the company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, actual outcomes and results are subject to risks and uncertainties that could differ materially from those forecasts due to the impact of many factors beyond the control of Cellectar.

The company assumes no obligation to update or supplement any forward-looking statements, whether as a result of new information, future events, or otherwise. Participants are directed to the cautionary notes set forth in today's press release, as well as the risk factors set forth in Cellectar's annual reports filed with the SEC for factors that could cause actual results to differ materially from those anticipated in the forward-looking statements. Now, I would like to turn the call over to Jim Caruso, President and Chief Executive Officer of Cellectar. Jim?

Jim Caruso (President and CEO)

Thank you, Monique, and good morning, everyone. It is my pleasure to welcome you to our conference call, highlighted by this morning's announcement that top-line data from our CLOVER-WaM pivotal study in Waldenström's macroglobulinemia is planned to be announced the week of January 8th, 2024, during the JPMorgan Healthcare Conference.

We continue to collect and evaluate patient data from our pivotal trial and view this announcement as a potentially transformational event for the company, and as such, merits increased awareness and an attentive audience, which the JPMorgan Healthcare Conference will certainly provide. As previously discussed, our operations team has been engaged in the development of our NDA filing, which we plan to submit in the March or Q2 2024 timeframe. Assuming a priority review based on iopofosine's Fast Track designation, a 6-month FDA review targets the potential approval of iopofosine in Q4 2024.

Later in this call, Shane Lee will provide a summary of our commercial launch activities in preparation for our planned Q4 2024 US launch. While the company priority remains focused on the FDA approval and commercial launch of iopofosine I 131 for WM, in parallel, we continue to evaluate iopofosine I 131 for relapsed/refractory primary central nervous system lymphoma and salvage therapy multiple myeloma in our ongoing phase II-A clinical study.

In addition, we look forward to announcing the first planned enrolled patient in our phase I-B in pediatric high-grade glioma. On the financial front, we recently completed a successful PIPE led by Rosalind Advisors, with participation from an excellent group of new and existing institutional investors, including AIGH Capital, ADAR1, Second Line, Nantahala Capital, and AuCo, among others.

The PIPE is expected to provide more than $100 million in funding to fully support our strategic plan into mid-2025, including iopofosine I 131 development and commercialization, our research and development plans across the entirety of our platform, and supports our transition to a commercial biotech company.

Over the past quarter, we added two key executives to our commercial leadership team to prepare for the potential marketing of iopofosine. We further strengthened our global intellectual property portfolio with the addition of four new patents and secured PRIME Designation in Europe for iopofosine and relapsed/refractory WM. We view this designation as a significant achievement. PRIME Designation is granted to less than one in four applicants and is designed to expedite the achievement of marketing authorization in the EU.

The remainder of our call today will consist of a brief financial update by Chad, a commercial summary from Shane, and a WM market landscape review by Andrei. I will close with a brief WM-specific summary, and then we will open the call for Q&A.... I'll now hand it over to Chad for a brief review of our financials. Chad?

Chad Kolean (VP and CFO)

Thank you, Jim. Let me start by noting that I will be providing certain key information regarding our financial results for the quarter that were included in our press release this morning. We expect to file our 10-Q for the third quarter next week. Research and development expenses for the quarter ended September 30th, 2023, were $7.3 million, compared to $5.4 million in the same period last year. R&D increased as we accelerated our enrollment in our WM pivotal trial, as well as initiating activities for our pediatric study in high-grade gliomas into a phase I-B, and expanding the central nervous system lymphoma cohort of our phase II-A basket trial in hematologic malignancies. G&A expense for the third quarter of 2023 was $2.1 million, a slight reduction from the third quarter of 2022.

Modest increases in personnel and other administrative fees were more than offset by reduced professional services expenditures. Cash and cash equivalents for the third quarter ended September 30th, 2023, was $19.0 million, which includes the net proceeds from our recently completed PIPE transaction.

The company expects total gross proceeds of $102.9 million from the PIPE, based upon achievement of certain milestones. The company believes its current cash on hand is adequate to fund budgeted expenditures into the second quarter of 2024. Now I'll turn the call over to our Chief Commercial Officer, Shane Lee.

Shane Lea (CMO)

Thank you, Chad, and good morning, everyone. I'm excited to provide an update on our commercial planning activities as we've made considerable progress in preparation for the potential quarter four, 2024 launch of iopofosine I 131 in Waldenström's macroglobulinemia. WM can have a significant impact on the quality of life of patients and their families. WM is a form of indolent non-Hodgkin's lymphoma, with an estimated U.S. prevalence of 26,000 patients.

Patients are concentrated geographically, and approximately 50% are managed in the community setting and about 50% in the academic setting. Today, approximately 80% of WM patients are receiving active therapy, and chart data demonstrates that 78% of all WM patients will receive third-line treatment. Our market research also suggests that half of third-line patients not receiving therapy will consider new treatment options as they become available.

Currently, treatment options are extremely limited beyond second-line therapy and have typically achieved poor major response rates with no complete responses reported. BTKI therapies require continuous treatment, which means that the medication must be taken daily, potentially creating toxicity, compliance, and financial burden for patients.

Based on our assessments, we believe there is a significant opportunity for iopofosine to improve and expand treatment in a substantial, concentrated, prevalent patient population by potentially providing improved major response rates and complete responses with a fixed dosing schedule versus continuous therapy. Additional survey information received from WM treaters highlights the significant opportunity for new treatment options with improved efficacy. High treatment exposure to approved therapies, significant refractory disease, apathy resulting from limited FDA-approved options, and the need for novel MOAs with improved efficacy are key issues cited by WM treaters.

We believe iopofosine I 131's product profile will address these issues by providing a new, targeted MOA and the potential for increased efficacy across all genotypes, including complete responses with meaningful progression-free survival. Importantly, third-party market sizing research commissioned by Cellectar suggests a strong market opportunity with a third-line or greater addressable population of approximately 4,300 patients. Of these, there are approximately 988 patients who have received two prior therapies and are not currently on active treatment.

This indicates that these patients have exhausted the limited FDA-approved therapies and experienced disease progression or treatment toxicity, which means there are no proven options and only salvage therapies available for next line of treatment, creating a rapidly available market expansion opportunity. In addition, there is an annual incidence of 900 patients moving into the third line.

To summarize the market, WM represents an underserved patient population, is highly scalable and concentrated, which will support orphan drug pricing and allow for an efficient go-to-market infrastructure. Our commercialization planning priorities will be focused on four key areas, which will include building smart data and commercial capabilities. Second, advancing iopofosine positioning and awareness. Third, optimizing the radiotherapy buying process, and fourth, planning for effective payer and access reimbursement for iopofosine.

As we engage in executing these priorities, we will utilize external customer focus to provide the best experience for iopofosine with key stakeholders. To that end, we recently announced a strategic collaboration with Florida Cancer Specialists to advance patient care and further define U.S.-WM treatment landscape through evaluation of the 1,000+ WM patients currently being managed within their system.

This is the first of planned community-based cancer care network collaborations for Cellectar to facilitate future patient access and to optimize the patient experience and clinical success, clinical success with iopofosine. We believe the potential approval of iopofosine in relapsed or refractory WM will provide a much-needed option, enabling more patients to be treated in the community setting.

In summary, we have made excellent progress with our WM market assessment and associated commercial planning while optimizing resource allocation. As described, we have completed the market sizing assessment and remain thoughtful and deliberate in the execution of staffing plans. Brand development work has been initiated, along with the construction of our smart data capabilities, which will support our cost-efficient go-to-market model, designed to quickly capture the WM opportunity.

Based on our ongoing evaluation of the WM market and customer feedback on iopofosine's potential profile, we remain optimistic that iopofosine may play a meaningful role in the treatment of WM and in patient quality of life. For the reasons previously described, WM represents a significant commercial opportunity, including the sizable patient population, limited existing treatment options, orphan disease pricing, and iopofosine's novel product profile.

We remain committed to supporting WM patients and will continue to move forward with a strong sense of urgency and purpose. If approved, we believe iopofosine will be an important new treatment option and represents a potential paradigm shift for relapsed or refractory patients requiring treatment for WM. I will now hand it over to Dr. Shustov for our clinical update. Andrei?

Andrei Shustov (SVP in Medical)

Thank you, Shane. Good morning, everyone. Over the next few minutes, I will provide a brief overview of WM's clinical features and the current treatment landscape, as well as the patient population that might benefit from treatment with iopofosine I 131. Waldenström's macroglobulinemia is a neoplasm of small B lymphocytes, plasmacytoid lymphocytes, and plasma cells, usually involving bone marrow and sometimes lymph nodes and spleen.

It is characterized by slow indolent growth, but eventually the crowding of the bone marrow results in cytopenias and suppression of the immune system, raising the risk of infection. It is further characterized by uncontrolled production of IgM monoclonal protein, not dissimilar from multiple myeloma, that by itself presents risk of significant morbidity. WM remains incurable despite currently available therapies. Therefore, all patients will ultimately receive an initial therapy and subsequently progress through all available salvage options over the course of the disease.

A typical patient with WM is diagnosed between 63 years and 68 years of age. For the patient population in the United States, this generally means that patients are of retirement age, and quality of life and duration of therapy become critical factors in selecting initial and subsequent therapies. The choice of therapy for WM is dictated by both patient and disease characteristics.

From a patient characteristics standpoint, younger patients at the time of diagnosis may be able to tolerate more aggressive and toxic therapies. However, given disease epidemiology, most patients are not candidates for such aggressive treatment approaches and would strongly prefer novel agents with a favorable toxicity profile. Duration of therapy is also an important factor in treatment decisions, with short-duration therapy strongly preferred for many reasons, including extended treatment-free intervals and improvement in quality of life.

From a disease characteristics standpoint, two genetic markers, MYD88 and CXCR4, have been linked to inherent resistance and affect treatment choice and outcome. The MYD88 mutation is present in most WM patients and appears to correlate with improved responses to therapy. As such, patients harboring this mutation would typically receive a combination treatment in frontline that includes BTKI therapy, and if not used in frontline, a BTKI is likely to be the first subsequent treatment options for relapsed or refractory disease.

Conversely, patients with unmutated or wild-type MYD88 profile are more likely to be resistant to therapy and much less likely to respond to BTKI therapy. These patients will be offered chemotherapy or chemoimmunotherapy in the frontline and/or relapse setting. In either case, once patients progress through chemotherapy and BTKI lines of treatment, options are very limited with no approved therapies.

BTKI inhibitor therapy has emerged as the most frequently utilized treatment platform for both newly diagnosed and second-line relapsed refractory patients. BTKIs exploit the dependency of cancer B lymphocytes on continuous BCR stimulation. Two BTKI agents have been approved for the treatment of WM. Although BTKI therapy typically lacks the acute high toxicity of chemotherapy agents in combinations, it does have its own activity and adverse event limitations. First, in combination or as monotherapy, BTKI therapy rarely leads to attainment of complete remission.

This likely represents the inability of BTKI drugs to achieve meaningful disease volume reduction. In other words, responses mostly represent suppression of IgM secretion by tumor cells rather than tumor cell apoptosis. Further, patients with tumors that are MYD88 wild type have a significantly lower chance of attaining a response, and if a response is achieved, will experience a shorter duration of response.

It is important to know that approximately 30% of patients are ineligible or inappropriate for BTKI therapy based on toxicity and intolerance due to cardiac arrhythmias, diarrhea, neutropenia, infections, or fatigue. Chemotherapy has its own limitations. Given high acute toxicity and long-term sequelae, many elderly patients with WM will not be candidates for combination chemotherapies, either at the time of initial diagnosis or disease relapse.

Chemotherapy is not applicable to a significant proportion of patients due to development of resistance, poor tolerance, and has a significant impact on quality of life, patients with this incurable malignancy. This brief review underscores the high clinical need for WM patients after failure or intolerance of limited available therapies. It is our belief that iopofosine I 131 product profile will provide a novel and meaningful treatment option for patients suffering from WM.

I should also mention that iopofosine I 131 provides a new and unique mechanism of action. Specifically, by targeting I-131 to tumor cells, it exploits powerful ionizing radiation energy, resulting in DNA damage and eventual apoptosis. As a disease-modifying cytotoxic agent, iopofosine I 131 has a potential to achieve significant tumor reduction and complete remission in patients whose disease is refractory to all available treatment options.

Importantly, iopofosine I 131 presents as a truly fixed duration therapy, with just four doses administered over a course of two cycles, which is in sharp contrast to existing treatment options, including BTKIs, which are required to be administered every day until the patient can no longer tolerate the drug or experience disease progression. Iopofosine I 131 is administered as an outpatient therapy.

You have likely seen the results from our phase II-A clinical study, which are impressive and served as a basis for further evaluation of iopofosine I 131 in Waldenström's macroglobulinemia. As presented on this slide, 100% or 6 out of 6 patients with highly refractory WM and a median of 3 prior lines of therapy achieved an overall response, and 5 out of 6 patients achieved major responses. It is especially noteworthy that 1 out of 6 patients achieved complete remission with single-agent iopofosine I 131 therapy after failure of all prior treatments. Response to iopofosine was independent of mutational landscape, as depicted at the bottom of the graph. Importantly, the duration of response was clinically meaningful beyond 20 months and compares favorably to all available options in this population.

As you're aware, these initial results facilitated the development of a global registrational trial of iopofosine I 131 in patients with relapsed refractory WM, as depicted on this slide. The target enrollment for the study is 50 WM patients who received at least two prior lines of therapy, which may or may not have included a BTKI. Eligible patients are treated with two cycles of single-agent iopofosine I 131 in outpatient setting, each cycle consisting of infusions on day 1 and 15, and approximately day 57 and 71. There is no continuous therapy, maintenance, or consolidation after completion of the second cycle. Responses are measured on a weekly basis to accurately identify time to response and time to best response. The primary endpoint of the study is major response rate, with a 20% threshold achieving statistical significance.

Secondary endpoints of the study include duration of response, overall response rate, and overall survival. After completion of therapy, patients enter long-term safety follow-up. As Jim stated earlier in the call, we look forward to announcing top-line data results. I hope that you share in our excitement regarding this announcement and the potential of iopofosine for treatment of WM patients. I will now turn the call back over to Jim.

Jim Caruso (President and CEO)

Okay, thank you, Andrei. To summarize the iopofosine WM milestone timeline and events, we plan to announce top-line data the week of January eighth, during the JP Morgan Healthcare Conference. Following top-line data, we plan to submit an NDA to the FDA as early as March or in the second quarter of 2024. Based on iopofosine's WM Fast Track designation, we will submit in parallel a priority review application. If accepted, we anticipate a six-month FDA review of our NDA. Assuming approval in the fourth quarter of 2024, we would subsequently initiate the commercial launch. With that, I will now turn the call over to the operator to manage the Q&A portion of our call. Operator?

Operator (participant)

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press the star followed by the one on your touchtone phone. You will hear a three-tone prompt acknowledging your request, and your questions will be polled in the order that they are received. Should you wish to decline from the polling process, please press the star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. Our first question comes from Jonathan Aschoff of Roth MKM.

Jonathan Aschoff (Managing Director and Senior Research Analyst)

Thank you, guys. Good morning, and thanks for all that detail. I was curious, you know, what extent of commercial infrastructure will you need to build out, you know, sales, marketing hires, commercial manufacturing, you know, headcount and costs? What kind of expense are you looking at for the US?

Jim Caruso (President and CEO)

Good morning, Jonathan. First of all, thanks for your participation. Also, thanks for the question. And it's obviously the right question. Before I turn over, you know, to Shane to provide some greater detail around this, I will say that we, you know, as we approach our commercial launch, you know, we're really gonna use smart data sets to assist in our targeting and resource allocation. We believe that'll help us, certainly from a cost effectiveness perspective, to provide an OpEx that is typically and traditionally, significantly lower than what you would typically see with an oncology launch. And this space, in particular, you know, works to this based on the scalable nature of this approach. So with that, let me turn it over to Shane to provide some detail.

Shane Lea (CMO)

Yeah. Thanks, Jim, and thanks, Jonathan, for the question. So obviously, very important as we think about how to strategically build out our go-to-market model. As highlighted, related to the disease itself, remember, this is a concentrated disease geographically, and so I think that's gonna afford us the opportunity, leveraging smart data, to build out a very efficient go-to-market model, which would exist and containing folks in the field across various functions, both medical sales liaisons, healthcare hematology specialists. We have standard normal marketing functions. Some functions we'll be able to outsource those capabilities to maximize efficiency. And so being that it's concentrated, being that we're gonna leverage smart data, it'll give us the opportunity to be very pointed into the focus in what we call our fast-to-market accounts.

These are accounts which have a high WM claims profile, and they have radiotherapeutic capabilities. We believe that essentially represents 40%-50% of the market opportunity.

Jonathan Aschoff (Managing Director and Senior Research Analyst)

Okay, 'cause I'm sure that you guys-

Jim Caruso (President and CEO)

Yeah.

Jonathan Aschoff (Managing Director and Senior Research Analyst)

Go on. I'm sorry.

Jim Caruso (President and CEO)

Then, Jonathan, 'cause... Yeah, no worries. From an OpEx perspective, I think it's fair to build into your model approximately $25 million on an annual basis to support the full commercial infrastructure.

Jonathan Aschoff (Managing Director and Senior Research Analyst)

Okay, that is an answer. Thank you, James. So what would it take in terms of clinical data to get multiple myeloma on the NCCN compendia? And, you know, how much of that data have you already generated?

Jim Caruso (President and CEO)

So before I turn that over to Andrei, as you know, part of our phase IIa, we continue to enroll, highly relapsed, refractory multiple myeloma patients. I know you're familiar with our data set to date, and quite frankly, across the board, in a variety of different, you know, I guess, subtypes within the multiple myeloma, a patient type, we range from 40%-60% in terms of responses, and the most recently, that post-BCMA data, that we presented at ASH, last year, where we had a 50% response rate in a very difficult-to-treat patient population, where, quite frankly, there are very limited to few options available.

I'll let Andrei talk to, you know, his thinking about how we take advantage of, you know, I guess NCCN guidelines to think about the utilization of multiple myeloma post the approval of WM.

Andrei Shustov (SVP in Medical)

Thank you, Jim. This is certainly a very important question, and, as Jim stated, we are very encouraged with our accumulating data of iopofosine activity in multiple myeloma, multiple subset patients, including triple, quadruple, penta-refractory, and those with post-BCMA relapse of the disease. The challenge, as understandable, that we are mitigating, is rapidly evolving field of multiple myeloma and optionality for patients with this disease and continuously added new treatments. We're in close talks and collaboration with KOLs in the field to identify the appropriate niches for iopofosine. We are confident that novel mechanisms of action and the advantages of short duration of therapy, as mentioned for WM, will also be a benefit for patients with WM. So our current strategy is to continue enrichment of highly refractory patients in our study.

The study continues to enroll patients to identify a specific population for which iopofosine treatment will be most appropriate. So study is continuing enrollment. We're enriching our subsets, and over the next year or so, we will continue our development and decision-making regarding proper positioning for NCCN guidelines.

Jonathan Aschoff (Managing Director and Senior Research Analyst)

Okay. Any of the docs that have treated these salvage MM patients conveyed to you that in their view, this is a no-brainer to use this in that setting?

Andrei Shustov (SVP in Medical)

Thank you for that question. We are hearing from our KOLs in multiple myeloma field, that we do have clear and significant advantages. Again, based on MOA, depth of responses we see, and especially in very highly refractory patients. They're very encouraged with coming to their patients with novel MOA after all available treatment options are exhausted. And that excitement certainly is very visible and encourages us to continue our development.

Jonathan Aschoff (Managing Director and Senior Research Analyst)

Great. So basically, Jim, you know, you've just set a prominent stage upon which to release your data in January, and, you know, you have real-time data from a single-arm trial, stress on single arm. So, you know, explain to me how this could possibly blow up in your face?

Jim Caruso (President and CEO)

I'm not sure. You know, as you think about it, there's really, you know, few, if any, pathways, you know, to, as you said, where, you know, I guess, a disastrous outcome, right? So when you think about, the data that we have presented, and that, Andrei presented again today, in that patient population, albeit an N of six, but very broad, across a highly refractory patient population in WM, across, you know, a variety of genotypes. Certainly the most difficult to treat, you know, at the mid- to 88 CXCR4, non-mutated, as Andrei described. And you saw the responses that were provided there. You know, as I think we've shared publicly in the past, our patient population in this pivotal study, obviously, would be very similar to that patient population.

The mechanism of action for our drug, obviously, is the same for the pivotal study patient population as well as those in the initial six patients. Then you take a look at the product profile, which quite frankly would compare favorable to those few agents that are indicated currently for WM and for, quite frankly, any of the salvage therapies and chemotherapeutic soups that are used, you know, as a desperate, you know, treatment attempt for these patients. Then you take a look at the, you know, the patient demographic, the older patient population, and the challenges associated with comorbidities in those, you know, late 60s to 70s.

You look at the adverse events associated with those treatment modalities I just cited, the BTKIs, as well as the chemotherapeutic soups and other related salvage therapies, and the continuous nature of treatment. It's a challenge, you know, Jonathan, for those patients. Then you look at our product profile. You look at the four single 15 minute-20 minute infusions, you look at the highly manageable and very predictable adverse event profile, which, oh, by the way, is transitory upon completion of the second cycle. So those cytopenias, which are very manageable, and both lymphoma and hematologist experts will tell you, very comfortable in terms of the management of that, you know, you have a really nice product profile.

Now, on top of that, you have a level of activity that we believe, quite frankly, will compare very favorable to those aforementioned treatment modalities or options that currently exist. And I think it's a function of, as Andrei just mentioned, our mechanism of action, where we really have an opportunity to have a meaningful impact on the course of the disease. I mean, when you think about currently, the number one prescribed class of medication in this space, you know, it's suppressing IgM, which in turn, you know, the, the concept is to reduce the the sequela associated with the disease by, you know, maintaining a lid on IgM.

Iopofosine I 131, just based on its mechanism of action and capacity to ultimately kill tumor cells, will in fact have, we believe, a meaningful impact on the course of the disease. Now, having said all that, what does that mean? It means there's a potential here for complete remission, which really doesn't exist, certainly in the relapsed refractory setting, in monotherapy, nor in combination, and even the best and most controlled clinical trials upfront, I think there's a 3%-5% CR rate in combination in naive patients, you know, potentially self-selected as well. Certainly, you know, not part of the non-mutated patient population.

So now you have a drug with a very, very clean adverse event profile, a very fixed and definitive course of treatment with, quite frankly, the capacity to have a meaningful course correction on the disease itself and the opportunity for complete remissions, which you do not see in this disease, with extended progression-free survival or treatment-free remission as well. So we kind of like the way this stacks up. I, you know, really can't see, as you described, the wheels come off scenario here, based on the drug, the mechanism, what we've observed, and the consistency in terms of patient population.

Jonathan Aschoff (Managing Director and Senior Research Analyst)

Yeah, I think splitting the dose gives you a lot of punch for the pain. I think it was a very good decision. Lastly, is kind of a yes or no. Would you anticipate a confirmatory trial being much different from this current trial in design?

Jim Caruso (President and CEO)

We currently have ongoing discussions with the FDA. And, you know, those will continue. You know, we believe we have some considerable optionality here. And so, you know, obviously, our discussions with the FDA are confidential, and we continue to explore those. We do believe, you know, without specifically answering your question, that we have considerable optionality here, just based on the nature of the disease, the very limited treatment options, and, you know, what we believe is a very favorable product profile, as I described, both from an activity perspective as well as, you know, AE profile.

Jonathan Aschoff (Managing Director and Senior Research Analyst)

Thank you very much, guys.

Jim Caruso (President and CEO)

Thank you, Jonathan.

Operator (participant)

Your next question comes from the line of Jeff Jones of Oppenheimer. Please go ahead.

Jeff Jones (Managing Director and Senior Analyst in Biotechnology)

Thanks, guys, and congratulations on the updates. You know, following up on Jonathan's question around the confirmatory study, the agency's been making noises on occasion about having confirmatory studies agreed to, or in some cases, even begun prior to accepting the NDA application or alternatively, approving the product. And so I guess, what are you hearing at this point? And then how do you think about recruiting for a trial like that in an orphan indication when the drug's available and on the market, and how does that impact your commercial strategy?

Jim Caruso (President and CEO)

No, that, that makes sense. And hence, you know, your, your upfront description of how the FDA currently behaves, you know, that's why, Jonathan, we're currently, you know, in dialogue and in discussions with them, you know, to ensure that, that we're aligned in terms of how to, how to move forward, in the best fashion. You know, not only for, you know, the approval of iopofosine I 131, but what additional information we can glean, you know, to potentially help, you know, WM patients and those patients, suffering, you know, from WM. And so, Jeff, on the impacting the commercial side of this, I'll, I'll turn it over to... Do you see any, Shane, impact relative to the commercialization of the drug with this?

Shane Lea (CMO)

Yeah, no, I think obviously the key is, to your point, understanding of how things play out with the ongoing discussions with the FDA, and obviously, don't see any impact there from a commercial standpoint as we think about the opportunity.

Jim Caruso (President and CEO)

Is that helpful, Jeff?

Jeff Jones (Managing Director and Senior Analyst in Biotechnology)

Yeah, it was great. Appreciate it. And I guess on the, the financing, I believe the next tranche can come in on positive data. And can you remind us what-- how positive data is defined in, the financing?

Jim Caruso (President and CEO)

The positive data was defined, and I'm not sure if this is in the public domain, but I would direct you to the pivotal trial. You know, in our corporate presentation, we have an overview and a slide on the pivotal trial, and there we describe the statistical expectation, you know, that we agreed to with the FDA. And I think that would be directionally a good place to start in terms of, you know, what's considered successful. I will tell you that, you know, our review of community-based performance in the literature relative to academic performance in these relapsed/refractory patient populations, it's pretty clear that anything 30% or north would be a win for WM patients, both in the community and academic centers, in these relapsed/refractory patient populations.

So I, you know, I give you two potential benchmarks there. One, FDA statistical alignment with our pivotal study, and then just based on a variety of feedback from advisory boards, key thought leadership, both from the academic centers as well as in the community, and then community-based data that we've had access to and we're beginning to, you know, peel the onion back there relative to actual patient performance with WM as they're treated in the community.

Jeff Jones (Managing Director and Senior Analyst in Biotechnology)

Great. Thanks, guys, and congratulations on the quarter.

Jim Caruso (President and CEO)

All right. Thanks so much, Jeff. Appreciate your time.

Operator (participant)

Your next question comes from the line of Ahu Demir of Ladenburg. Please go ahead.

Ahu Demir (Senior Research Analyst in Biotechnology)

Good morning. Thank you so much for taking my questions and the information you provided today. I have three questions. The first one is, what do we expect from the top-line data? Do you plan to disclose a subset of patients, such as post-BCMA, similar to what you have shown previously?

Jim Caruso (President and CEO)

Thank you for this question. I will try to take this one. So I assume that the question pertains to our pivotal trial. As I've stated in our clinical trial design and we discussed today, we plan on disclosing top-line data related to primary and secondary objectives of the study, including major response rate, overall response, and the rate of complete remissions.

Ahu Demir (Senior Research Analyst in Biotechnology)

That's helpful. Thank you.

Jim Caruso (President and CEO)

And then the second part of your question... Yeah, the second part was related to multiple myeloma?

Ahu Demir (Senior Research Analyst in Biotechnology)

Yes, that is correct, Jim. I was asking about-

Jim Caruso (President and CEO)

So, uh-

Ahu Demir (Senior Research Analyst in Biotechnology)

The post-BCMA patients.

Jim Caruso (President and CEO)

Yeah. So, switching back to multiple myeloma. So first, we recently published results on a few patients right after previous ASH on post-BCMA-treated patients with very encouraging results in terms of response and duration of response for this population. As I stated a bit earlier, our current direction in this clinical development program is to enrich these and other highly refractory populations. And once the enrichment is complete from statistical perspective, we would certainly be analyzing the subgroups of patients and the type of data will be similar to what we are planning to report in the end pivotal study and pertain to response rates and duration of response for this difficult population.

Ahu Demir (Senior Research Analyst in Biotechnology)

Thank you. My second question is, what are the plans for ex-US commercial efforts? Do you intend to file in Europe? Are you going to wait for the confirmatory study? Are you also looking into partnerships for ex-US opportunities?

Jim Caruso (President and CEO)

Yeah, that's a great question. You know, one, I will direct you to, you know, our receipt or we were awarded the PRIME Designation, which, as you know, is very difficult, especially over the last handful of years, more and more challenging, to receive that from the EU. That helps us on multiple levels. Obviously, it increases our dialogue considerably with the, with, the authorities, the regulatory authorities, and they are. There's a level of high commitment, to help expedite or accelerate, products like this that they deem, solve an unmet, clinical need or an underserved population, and that the drug itself provides a meaningful, improvement over existing agents.

I will say, you know, they're very thorough in terms of their assessment, and they would look at, you know, all elements, both preclinical as well as clinical data. I believe it's fair to say that they reviewed our pre... you know, the first six patients, as well as those patients participating in our clinical trial as part of the interim assessment that we had built in along with the FDA. So their level of diligence is very, very deep and, you know, in today's environment, is quite frankly, more challenging than breakthrough designation in the US. So that'll help us or others in terms of advancing, you know, iopofosine I 131 through the regulatory pathway in the EU. I...

You know, obviously, we have the capacity because of the scalable nature in the U.S., you know, of this disease, as Shane highlighted earlier, highly concentrated, a handful of, community-based integrated delivery systems, you know, maintaining control and oversight and patient management of a considerable number of the total population in the U.S. And then, obviously, those academic centers that are considered, centers of excellence, to treat this patient population. And there's really no large multinational pharmaceutical machinery in the WM space as well.

So it's pretty wide open for us, and that's where a highly efficient, cost-effective, highly targeted, commercial marketing effort allows us to compete and win there with, you know, resources, pennies on the dollar relative to some of these other spaces, where that are highly competitive and where there's a number of available treatment options that are being supported by large multinational pharmaceutical companies. The difference in Europe is we do not obviously have the capacity to successfully promote there as a standalone. I will tell you that there is, obviously, you know, one of the pathways that we would consider as a primary approach to ex-US commercialization is through partnership.

Obviously, based on the first six patient data, ongoing discussions, there's a high degree of interest from third parties to take on that commercial marketing leadership role for us, ex-US.

Ahu Demir (Senior Research Analyst in Biotechnology)

Thank you, Jim. I have one last question, if I could squeeze in one more. Following up on the confirmatory study, as the discussion continues with FDA, when do you plan to disclose or report additional clarity, what you will be doing? Are we expecting to see that, after top line data or before any timeline that you, you could communicate with us?

Jim Caruso (President and CEO)

Oh, that would clearly be... great question. From a timing perspective, it would clearly be post top-line data.

Ahu Demir (Senior Research Analyst in Biotechnology)

That's great. Okay, thank you very much for taking my questions.

Jim Caruso (President and CEO)

Of course. Thank you.

Operator (participant)

Your next question comes from the line of Jason McCarthy of Maxim Group. Please go ahead.

Jason McCarthy (Senior Managing Director and Head of Biotechnology Research)

Hi, good morning, Jim. Thanks for taking the questions. You briefly touched on this, but maybe you can provide some additional color on how the top-line data may be presented. Meaning, would you stratify the data by CXCR4 and MYD88 mutations as well as patients, even though they're third line, you know, that 30% or so that never got a BTK, with the idea that maybe you could make certain claims in a potential label?

Jim Caruso (President and CEO)

Before I turn it over to Andrei to respond to that, I will share that our patient population is a relapsed refractory population, you know, obviously across the board. These are patients that have been treated with multiple lines of therapy. You know, it is a difficult and challenging to treat population. When you think about a label, obviously our clinical trial was designed for a label for third line or greater. Based on the patient population we have, I think it's fair to say that we could engage the FDA and potentially expand that label to relapsed refractory versus third line plus. So, Andrei, any, any comments relative to?

Andrei Shustov (SVP in Medical)

Yeah. Thank you, Jim and, Jason, this is excellent question. And, to your point, we absolutely, are gonna be looking at grainy details of our data, as we should. Remembering that, with target enrollment of 50 patients, once you start splicing this population, it's gonna get really grainy, and we will be very careful making any, definitive conclusions if we have single-digit number of patients. But, what we are committed to is certainly, delivering, top-line data results on, our primary and major secondary objectives. But all the exploratory objectives will be looked at, and we will be deciding real-time, whether first we detect a signal or it's, it's, meaningful, and, worth, disclosing.

But again, our focus is really on the primary and major secondary objectives at the time of data disclosure.

Jason McCarthy (Senior Managing Director and Head of Biotechnology Research)

And last question, just briefly. Just from a safety profile aspect, you know, along with that top-line data, would you mention lack of bleeding risk? And the bleeding became issues, obviously, with WM generally, but the BTKs, when that second one was developed, that became an area of investor focus. Would you take the opportunity to highlight a cleaner safety profile around your drug, even though it's a, it's a different category than the BTK?

Andrei Shustov (SVP in Medical)

Thank you, Jason. Again, another very important question, and we believe that we are certainly well-positioned in comparison to, as you mentioned, BTKIs, in terms of specifically bleeding and hematologic profile for a couple of reasons. Our hematologic AEs are expected, predictable, manageable, and recoverable in all the patients, and based on very short duration of treatment, are expected, we expect that patients will need very temporary support as opposed to continuous therapy with BTKIs. And I will also mention mechanistically, the issue that you brought up, bleeding with BTKIs goes to mechanism of action and not just cytopenias.

Mechanistically, we do not have reason to believe that bleeding will be functional, and with proper supportive care for cytopenias, we should not expect any clinically meaningful or dangerous high rate bleeding complications. And again, I truly believe that we will be positioned very well from a duration standpoint and mechanistically to against a bleeding signal that was detected with BTKIs.

Jason McCarthy (Senior Managing Director and Head of Biotechnology Research)

Great. Thank you, fellows. Looking forward to the data in January.

Jim Caruso (President and CEO)

Yeah, thanks much, Jason. Appreciate it.

Operator (participant)

There are no further questions at this time, so I will hand back to management. Please proceed.

Jim Caruso (President and CEO)

Okay, thank you, operator, and certainly thank you to all of our participants today. I thought we had a lot of great questions. Since there are no more questions, we'll now close our discussion. Very appreciative of all of you joining us today, as I cited earlier, and we certainly look forward to updating you on our next call and obviously sharing with you our top-line data from our WM pivotal trial, which we believe will be transformational for the future of our company. We thank you.

Operator (participant)

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating. We ask that you please disconnect your line.