Good morning, ladies and gentlemen and welcome to the Bio-Path Holdings' Second Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. Following the formal remarks, we will open the call up for your questions. I would now like to turn the call over to Will O’Connor of Stern Investor Relations. Please proceed..

Thank you, operator. Welcome to the Bio-Path Holdings conference call and webcast to review the company's second quarter 2021 financial results, and to provide an update on recent pipeline and corporate developments. Earlier, we issued a press release which outlines the topics that we plan to discuss on today's call.

The release is available at biopathholdings.com. With me today from Bio-Path are President and CEO, Peter Nielsen; and Senior Vice President of Finance, Accounting and Administration, Anthony Price. Before we begin the call, I'd like to remind you that today's discussion will contain forward-looking statements that involve risks and uncertainties.

These risks and uncertainties are outlined in today's press release and in the company's recent filings with the Securities and Exchange Commission, which we urge you to read. Our actual results may differ materially from what is discussed on today's call. With that, I'll now turn the call over to Bio-Path's CEO, Peter Nielsen..

Thanks, Will. Good morning, everyone, and thank you for joining us. The first half of 2021 was very productive for Bio-Path. And I’m pleased to provide an update on our recent progress. Over the course of the last 6 months, we’ve made meaningful progress in our pursuit of delivering a portfolio of targeted nucleic cancer drugs to patients in need.

I will begin with our lead product candidate prexigebersen, where we continue to make significant progress advancing Stage 2 of our Phase 2 clinical trial of prexigebersen for the treatment of acute myeloid leukemia, or AML, in combination with frontline therapy, decitabine and venetoclax.

As we’ve previously reported Phase 2 clinical development of prexigebersen in AML commenced with Stage 1 of the Phase 2 clinical trial, which was open-label and treated de novo AML patients with a combination of prexigebersen and low-dose cytarabine, or LDAC.

The combination of prexigebersen and LDAC was shown to be safe and more efficacious to treat this class of patients than with LDAC alone. As many of you know, there has been an evolving landscape for standard of care in AML. Despite these therapies, there are still patients who are refractory or resistant, and those are the patients we aim to help.

As standard of care evolved, we adapted our trial design to reflect these changes. The amended Stage 2 of this Phase 2 trial in AML is an open-label Phase 2 two-stage multicenter study of prexigebersen in combination with decitabine and venetoclax in two cohorts of patients with previously untreated AML and relapsed/resistant AML.

A third cohort includes treating relapsed/resistant AML patients who are venetoclax-resistant or intolerant with the two-drug combination, prexigebersen and decitabine.

The final trial design plans have approximately 54 evaluable patients for the cohort treating relapsed/refractory AML patients with the triple combination treatment of prexigebersen, decitabine and venetoclax, and the cohort treating AML patients who are venetoclax-resistant or intolerant with a two-drug combination of prexigebersen and decitabine with a review of both cohorts performed after 19 evaluable patients.

The full trial design plans have approximately 98 evaluable patients for the cohort treating untreated AML patients with the triple combination treatment of prexigebersen, decitabine and venetoclax with a preliminary review for the cohort performed after 19 evaluable patients, and a formal interim analysis after 38 evaluable patients.

The higher number of patients in the full trial design for the untreated AML patient cohort is due to the higher baseline response of the frontline therapy with previously untreated AML patients.

The primary endpoint for this study will be the number of patients who achieve complete remission, which includes complete remission with incomplete hematologic recovery and complete remission with partial hematologic recovery. An interim analysis will be performed on each cohort to assess the safety and efficacy of the treatment.

In the second quarter, we were excited to announce the successful completion of a safety run-in of the Stage 2 of the Phase 2, and we look forward to advancing this study as we believe its unique design provides us with several definable registration pathways.

Next, I would like to turn to our planned Phase 1 clinical trial prexigebersen-A in patients with advanced solid tumors, including ovarian, uterine, pancreatic and hormone refractory breast cancer.

Prexigebersen-A, a fourth Bio-Path drug candidate, is a modified product from prexigebersen sharing the same drug substance with enhanced nanoparticle properties. This trial will be conducted at several leading cancer centers and is planned initially to evaluate the safety of prexigebersen in solid tumor patients.

Patients diagnosed with recurrent ovarian and endometrial cancer often have poor outcomes, and it is our hope that prexigebersen may provide clinical benefit for such patients. Turning now to BP1002, our second therapeutic candidate, which targets Bcl-2. As you know, Bcl-2 is responsible for driving cell survival in up to 60% of all cancers.

High expression of Bcl-2 has been correlated with poor prognosis for patients diagnosed with AML. Venetoclax has also shown activity against anti-apoptotic protein Bcl-2 and works by neutralizing the proteins BH3 domain. It is an improved treatment for chronic lymphocytic leukemia, or CLL patients and untreated AML patients.

However, with the exception of some patients treated with allogeneic hematopoietic cell transplantation, disease relapse invariably occurs oftentimes due to BH3 domain mutation over time. BP1002 also targets the Bcl-2 protein. However, BP1002 activity is based on blocking the Bcl-2 messenger RNA and not the BH3 domain.

As a result, we believe that BP1002 could provide an alternative for venetoclax patients who have relapsed, including AML patients who previously received venetoclax treatments.

In a Phase 1 trial, refractory/relapsed CLL patients, including those who have failed or relapsed from venetoclax based frontline therapy, as well as refractory/relapsed lymphoma patients are being treated with BP1002. This trial is being conducted in several cancer centers.

We expect to initiate a Phase 1/1b clinical trial of BP1002 in refractory/relapsed AML patients to be conducted at several leading cancer centers in the United States, including the Weill Medical College of Cornell University, and the University of Texas MD Anderson Cancer Center.

In the AML trial, initially, a total of six available patients are scheduled to be treated with BP1002 monotherapy in a standard three plus three design, with a starting dose of 20 milligrams per square meter. The approved treatment cycle is two doses per week, over four weeks, resulting in eight doses administered over 28 days.

The Phase 1b portion of the study will commence after completion of BP1002 monotherapy cohorts, and we'll assess the safety and efficacy of BP1002 in combination with decitabine in refractory/relapsed AML patients. Finally, let me briefly review progress we've made with our third drug candidate, BP1003, which targets the STAT3 protein.

This program has shown promising preclinical data, and we are very excited for the future of this program. We are studying BP1003 for the treatment of pancreatic cancer in a patient-derived tumor model. Previous models have shown the drug to successfully penetrate pancreatic tumors and enhance the efficacy of standard frontline treatments.

We are particularly excited to launch our first in-human validation of this cutting-edge therapy in an especially challenging cancer indication that has limited treatment options. We are aiming to file an IND application with this very promising product candidate later in 2021 or 2022.

In June, we announced that the United States Patent and Trademark Office has granted a new patent relating to our BP1003 programs. The new patent builds on earlier patents that have been granted that protect the platform technology for DNAbilize.

As I've said before, we continue our efforts to build a fortress of protection around our technology, as it safeguards our platform technology and target-specific technology is a deterrent to would be competitors and creates value around our core competencies.

With that, I'll now turn the program over to Anthony Price for a brief review of our second quarter 2021 financials along with balance sheet highlights.

Anthony?.

Thanks, Peter. The company reported a net loss of $1.8 million or $0.26 per share for the 3 months ended June 30,2021 compared to a net loss of $2.0 million or $0.55 per share for the 3 months ended June 30, 2020.

Research and development expense for the 3 months ended June 30, 2021 decreased to $0.8 million compared to $1.0 million for the 3 months ended June 30, 2020, primarily due to timing of activities related to our clinical trials for BP1002 in lymphoma, prexigebersen in AML and prexigebersen-A in solid tumors.

General and administrative expense for the 3 months ended June 30, 2021, were $1.0 million, consistent with the comparable period in 2020. As of June 30, 2021, the Company had cash of $28.1 million, compared to $13.8 million at December 31, 2020.

Net cash used in operating activities for the 6 months ended June 30, 2021, was $4.2 million compared to $6.0 million for the comparable period in 2020. Net cash provided by financing activities for the 6 months ended June 30, 2021, was $18.6 million. With that, I'll now turn the call back over to Peter..

Thanks, Anthony. We ended the back half of 2021 in a stronger position than ever to advance our DNAbilize platform in a number of important cancer indications. We have a clear path ahead and are looking forward to generating the data to support our product candidates and to bring new treatment options to cancer patients waiting for breakthroughs.

With that operator, we're ready to open the call for questions..

[Operator Instructions] Our first question comes from the line of the Yi Chen of H.C. Wainwright. Your line is open..

Hi. Thank you for taking my questions.

Could you comment on whether the evolving pandemic is affecting the enrollment speed of the prexigebersen trials in AML?.

I have not -- had anything reported to me directly in that context. Part of our enrollment, if you recall, we have had to manage the enrollment rate with our drug supply. Recall at the end of last year, we had a -- we lost a double batch due to a supplier having a COVID outbreak.

And then following with that the replacement double batch had a plant malfunction. So it's kind of anything is possible in this COVID environment. We're now experiencing and having our first batch in recovery. It'll be delivery -- delivered in about 30 days. And then we have more after that. So we should be ramping up quite a bit.

We've continued treating and enrollment the whole time. I am concerned, as I'm sure everyone is about what's going on with COVID. And our patients, as you know, are immuno-compromised and the COVID variant that’s out there is deadly. So, at this point, I mean we’ve just had some patients enrolled in AML. So it's a good question and good thinking.

We watch it. But so far, unfortunately it's halted or greatly reduced our enrollment..

Okay.

The third cohort with relapsed/refractory AML patients, do you -- can reach the 19 evaluable patients for entering review by the end of this year?.

Well, previously, I felt that was the case and I said clamped down on enrollment. We're over a half of that to the 19, which of course we want to do, and we've had good results. So I just can't predict precisely. I know that we think that after September, we'll be able to ramp up some more and have those patients come in.

I think, as you saw in our April release on the six safety patients in a safety review [technical difficulty] although those didn't go over the third cohort, which is a two dose or a two-drug segment, but we've had good results and the feedback I get is that the PI like this prexigebersen drug. So it's hard to say. We're quite a bit of ways there.

We only need about seven more patients -- six patients. We'll see ….

Would you say that the circle [indiscernible] is enrolling faster than the first and second cohort?.

No, it just started earlier. So ….

Okay..

… I get the feedback, for example, the untreated the bar is higher with that, but we get the enrollments in that in our PIs, so like that combination, the triple one [technical difficulty]..

With -- regarding the Phase 1 trial of BP1002 in lymphoma, do you still expect to -- expect the trial to report data in the second half of this year?.

I don't -- it's how we've -- enrollment has been slower. And we've enrolled and treated the patient. The problem we have with that and in fact we're looking at increasing the number of sites.

The FDA makes you start out at a low dose 20 milligram per square meter, and what we're getting back from PIs is it's tough for oncologist to enroll a patient that needs help in a dose that's at the low end, if you do a safety escalation.

So we're working right now to see how we can increase that enrollment rate adding site, clearly one of the message -- messages. So, frankly, I can't say with positivity that we will be able to report that percent [ph] level.

If we do, I would not think it was -- would be anything that really reports on [technical difficulty] not a 20 milligrams per square meter. It would be [technical difficulty] there weren't any kinds of safety related events..

Got it. And lastly, the Phase 1 trial in solid tumor was Prexigebersen-A.

The trial is starting in the current quarter, right?.

That will start in this current quarter that we're in. And we’ve to do that we've been finishing up our IND on solid tumors, which is the Prexigebersen-A and don't forget the BP1002 in refractory/relapsed AML patients. And that one also -- and you'll hear something fairly soon on that..

That one is starting as well. Okay. Got it..

You'll hear something. We haven't put -- given an update on it, but you'll see something fairly quickly..

Okay, got it. Thank you..

You're welcome..

Thank you. Next question comes from the line of Laura Engel of Stonegate Capital Partners. Your line is open..

Good morning. Hi, Peter.

How are you?.

I’m fine, Laura..

Good.

So just wanted to ask minus, or barring anything, continuing problems from COVID, any continuing problems from the back issues? Could you give us just general expectations for levels of R&D expense second half of the year as compared to maybe first half, given that first half was fairly low versus my personal expectation?.

Yes, remember, as we've talked before, R&D expense for us is, is one of the major drivers for us is drug brand, drug product being manufactured..

Yes..

I would expect in the second half that, that will start to go up as I have more batches. I had one that's going through, and I think I've indicated would be expected to be fully released by the end of -- or in September. That of course will lead -- release any additional invoicing and expenses that come in as well.

As you'll notice on the balance sheet, we had the $300,000 increase in drug product for testing. And again, that's for our accounting. We take GMP related expense for the drug and accumulated is essentially a prepaid..

Right..

And when we finally get it finished, completed and released to us, then it drops in those expense. It's not inventory that has a resale value. So once you take it, you need to expense it all. So that's a good example of it. I've got another drug batch that was got started in July. It'll go through its cycle and should be releasing to us in December.

So that's another and that was a double batch. And so, that's I expect it to go up and it would be reflective of our pipeline getting pushed back up..

Right. Okay. Well, great, good. First half of the year, great cash balance, so looking forward to the second half of the year, and I'll get back in the queue. Thank you, sir..

Well, thank you..

Thank you. There are no further question at this time. I would like to turn the call back to Peter Nielsen for closing remarks..

Thank you again, everyone, for joining us, and for your continued support with Bio-Path Holdings. Have a great day..

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect. Have a great day..