PBLA - Panbela Therapeutics Inc. (PBLA) Q3 2022 Earnings CallTranscripts

Panbela Therapeutics, Inc. (PBLA)

Q3 2022 Earnings Conference Call

November 10, 2022 4:30 PM ET

Company Participants

James Carbonara - Hayden IR

Jennifer Simpson - CEO

Susan Horvath - CFO

Conference Call Participants

Tony Butler - ROTH Capital

Presentation

Operator

Good day, and welcome to the Panbela Therapeutics Third Quarter 2022 Earnings Call. [Operator Instructions]

It is now my pleasure to turn the floor over to your host, James Carbonara. James, the floor is yours.

James Carbonara

Thank you. And once again, welcome to Panbela's Third Quarter 2022 Earnings Call. With me on the call are Jennifer Simpson, Chief Executive Officer; and Sue Horvath, Chief Financial Officer.

Before I turn the call over to Dr. Simpson, please note that statements made on this call are not historical facts -- that are not historical facts may be forward-looking statements. Significant risks and uncertainties that could cause actual results to differ from those expressed or implied in the forward-looking statements are detailed in the company's annual report on Form 10-K and supplemented by subsequently filed quarterly reports on Form 10-Q as well as in other reports that the company has filed with the SEC. Any forward-looking statements made on this call are made only as of today's date, and the company does not undertake any obligation to update or supplement any such statements to reflect subsequent developments.

Now I would like to turn the call over to Jennifer Simpson, CEO of Panbela. Jennifer, please proceed.

Jennifer Simpson

Thank you, and thank you, everyone, for joining.

I will begin the call with a review of our clinical development program, recent accomplishments and upcoming milestones. We will then follow with a review of the financial results, and then we will open it up for Q&A.

Starting with our Phase III program, in August, we announced the international expansion of our Aspire trial evaluating gemcitabine and nab-paclitaxel with or without Ivospemin which is our new generic name for SBP-101 for untreated metastatic pancreatic ductal adenocarcinoma into Australia as well as the first patient enrolled. We also announced regulatory approval for the opening of trial sites in Spain, France and Italy.

With approximately 95 sites planned throughout the United States, Europe, Australia and South Korea, we are continuing to focus on site initiation and enrollment in order to ultimately deliver a more effective treatment for pancreatic cancer, a deadly disease with few treatment options. We expect that a significant number of global sites will be opened by year-end with the full complement of sites opened by early to mid-2023.

The trial sample size is 600 patients, and the primary endpoint will be overall survival. We will use overall survival for the interim analysis as well. It is anticipated to take approximately 36 months for complete enrollment with the interim analysis still available in early 2024. The interim analysis allows us to assess the merits of continuing the study as well as to ensure optimal resource utilization. We are excited to have these recent approvals as we move forward towards the interim analysis expected in a little over 1 year from now.

Turning to familial adenomatous polyposis or FAP, the registration trial with Flynpovi is anticipated to begin mid-2023 and is funded by our licensing partner, One-Two Therapeutics. We are working closely with One-Two to ensure alignment with the FDA on all key aspects of the trial before the trial commences. As the trial will utilize European clinical sites and we retain the rights outside of the U.S. and Canada, we will seek advice from the European authorities regarding the utilization of the registration trial for approval in Europe.

As a reminder, a prior Phase III study evaluating Eflornithine and Sulindac or Flynpovi versus either agent alone, showed a 100% risk reduction and a need for surgery in the lower gastrointestinal or GI group. As there are currently no approved drug therapies for the treatment of FAP, this data is exciting and the lower GI group is intended to be the focus of the new registration trial.

Lastly, we in partnership with One-Two also have an ongoing Phase III double-blind, placebo-controlled trial of Flynpovi, the combination of Eflornithine and Sulindac, prevent recurrence of high-risk adenomas and second primary colorectal cancers in patients with stage 0 to 3 colon or rectal cancer. This trial is known as the PACES trial and is funded by the National Cancer Institute, or NCI, in collaboration with the Southwest Oncology Group, also known as SWOG, and we look forward to a futility analysis in the first half of 2023.

Moving to Phase II studies. First, there is an ongoing trial in relapsed/refractory neuroblastoma utilizing eflornithine sachets. This trial is funded through the Children's Oncology Group, or COG, and the NCI.

We will also be starting in early 2023, a Phase II trial in early onset Type 1 diabetes utilizing Eflornithine tablets. This study is supported by Indiana University and the Juvenile Diabetes Research Foundation or JDRF.

In Phase I development, we have 3 programs that we will be starting. First, opening by year-end, we will be evaluating Eflornithine sachets in combination with KEYTRUDA in the STK11 mutation population of non-small cell lung cancer. STK11 mutant non-small cell lung cancer respond poorly to checkpoint inhibitors and bioinformatic analyses suggest that alterations in polyamine metabolic pathways may play a role in the resistance to immunotherapy. In preclinical tumor models, Eflornithine treatment improves anti-PD-1 efficacy by increasing tumor-specific cytotoxic T cell populations as well as increased expression of PD-1 on tumor-associated CD8-positive T cells.

The Phase I portion is fully funded, and we look forward to this trial starting as it will be the first clinical proof-of-concept trial focused on the relationship between polyamines and the immune system. If this trial is positive, it opens the possibility for combining with a checkpoint inhibitor in other tumors as well as the possibility of combining with other immunotherapies, such as CAR T therapy to improve response rates.

Our second Phase I program, which is scheduled to begin in the first half of 2023 will focus on the evaluation of Ivospemin in the platinum-resistant ovarian cancer population. As a reminder, we've collaborated with John Hopkins University School of Medicine to identify this indication. Additionally, a poster on the treatment of immune competent mice injected with VDID8-positive ovarian cancer with Ivospemin was presented and showed a significantly prolonged survival and decrease in overall tumor burden. The mature data was later published in the International Journal of Molecular Sciences, titled Expanded Potential of the Polyamine Analogue SBP-101 as a Modulator of Polyamine Metabolism and Cancer Therapeutic.

The publication highlighted that in vitro studies determined that SBP-101 reduced cellular viability across a broad range of cancer cell types with an exceptionally strong reduction in ovarian adenocarcinoma viability, resulting in a 42% increase in median survival in the VDID8-positive ovarian cancer mouse model. The data supports efforts to initiate an ovarian cancer clinical program.

Lastly, we have completed preclinical work necessary to begin a pancreatic cancer neoadjuvant investigator-initiated trial. We are working with the key opinion leaders to finalize the protocol and obtain the necessary institutional approvals to open this trial by early 2023.

Turning to milestones. In addition to continued execution of the various trials in our development program, we anticipate announcing final data from our Phase I trial in untreated metastic pancreatic cancer patients and early onset Type 1 onset diabetes by year-end or early 2023.

There will be final data from previously completed gastric cancer prevention trial by year-end or early 2023 as well as the futility analysis for the PACES trial in the first half of 2023. We also anticipate the Phase I data from the Eflornithine-KEYTRUDA combination in the STK11 non-small cell lung cancer trial by mid-2023 and the interim analysis from the ASPIRE trial in early 2024.

In summary, we have made tremendous progress in Q3 and year-to-date. We are excited to enhance stockholder value as we move ahead into Q4 and onwards by executing against our milestones.

I will stop here and turn it over to Sue to review the financials.

Susan Horvath

Thank you, Jennifer.

General and administrative expenses were $1.3 million in the third quarter of 2022 compared to $0.9 million in the third quarter of 2021. The change is due primarily to services and personnel costs associated with the acquisition and integration of Cancer Prevention Pharmaceuticals, or CPP.

Research and development expenses were $2.3 million in the third quarter of 2022 compared to $1.3 million in the third quarter of 2021. The increase is due to spending on our clinical studies as we ramped up efforts to activate up to 95 clinical sites around the world in the ASPIRE clinical trial.

As a reminder, the results for the 9 months ended September 30, 2022 included approximately $17.7 million of in-process research and development. IPR&D represents the primary asset acquired as a result of the acquisition of CPP. And GAAP accounting required writing off this asset to research and development expenses immediately after the acquisition in June.

Net loss in the third quarter of 2022 was $4.4 million or $0.21 per diluted share compared to a net loss of $2.1 million or $0.16 per diluted share in the third quarter of 2021. Total cash was approximately $0.9 million as of September 30, 2022. That does not include gross proceeds of approximately $6 million from our public offering which priced on September 30 and closed early in October.

Total current assets were $1.8 million and current liabilities were $8 million as of the end of the quarter. Also at September 30, 2022, total noncurrent assets consisting of cash deposits held by our contract research organization was $3.1 million.

As a result of the CPP acquisition, we now have debt and accrued interest on our balance sheet totaling approximately $8 million as of September 30, 2022. This includes 2 notes with principal balances of $6.2 million and $650,000, respectively, along with accrued interest. Both notes accrue simple interest at a rate of 5% per annum.

Looking to the cap table. As of September 30, 2022, we had 20.8 million of common shares outstanding. And including shares reserved for options and warrants, we were at 30.3 million shares. The shares reserved number includes all outstanding equity awards, including stock options which were held primarily by insiders and all warrants to purchase common stock.

After the public offering, which closed on October 4, 2022, we had approximately 27.9 million common shares outstanding. And including all shares reserved for options, warrants, including prefunded warrants, we were at 80.5 million shares.

Our cash used in operations for the 9 months just ended totaled approximately $10.3 million. During the first 9 months, the company paid $2.6 million in cash deposits to our global contract research organization which will be held to pay clinical expenses at the end of the ASPIRE trial.

This cash outlay for CRO deposits is not expected to be repeated. Ramped up activity in the randomized trial and costs associated with our acquisition drove the remaining increase in cash used in operations.

We project the cash with the early Q4 capital raise will take us into Q1 of 2023. We will continue to focus our cash on those items in our plan which will drive value for our stockholders, such as the ASPIRE trial.

That concludes my financial remarks. Operator, can you please open the phone lines for Q&A and poll for questions?

Question-and-Answer Session

Operator

[Operator Instructions] We have a question from Tony Butler from ROTH Capital.

Tony Butler

Jennifer, the data that you will release, the full Phase I in the pancreatic trial as well as the diabetes trial, is that going to be -- could you just -- or do you know how you might release that information, for example? Is it through a press release? Will it be on a call? And/or is it possible that it's actually at a clinical meeting?

Jennifer Simpson

Thank you, Tony. Yes, actually, we are focused on peer-reviewed journals in the respective areas of focus. And as soon as those journals are available for public viewing, we will also put out a press release highlighting the data in those trials.

Operator

[Operator Instructions] And there are no further questions in queue at this time.

This will conclude today's conference call and webcast. We do thank you for your participation. You may disconnect your phone lines at this time and have a wonderful day. Thank you again for your participation.

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