Greetings and welcome to the Oncternal Therapeutics, Incorporated's second-quarter 2021 financial results call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. . As a reminder, this conference is being recorded.

It is now my pleasure to introduce Richard Vincent, Chief Financial Officer. Thank you. You may begin..

Thank you Darryl. Good afternoon everyone and thank you for joining us today. Joining me on this call this afternoon are our President and CEO, Dr. James Breitmeyer and our CMO, Dr. Salim Yazji. We welcome all of you.

Today's call includes a business update, discussion of our 2021 second quarter financial results as well as our upcoming milestones, which will be followed by Q&A. Today's press release and a replay of today's earnings call will be available on the Investor Relations section of Oncternal's website for at least the next 30 days.

We also filed our 10-Q for the second quarter of 2021 earlier today. Please note that certain information discussed on today's call is covered under The Safe Harbor provisions of the Private Securities Litigation Reform Act.

We will be making forward-looking statements during this call about future events, such as our business and product development strategies and future financial and operating performance.

Our actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with our business.

These forward-looking statements should be considered in conjunction with and are qualified by the cautionary statements contained in today's press release and our SEC filings, including our Form 10-Q for the quarter ended June 30, 2021.

This conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, August 5, 2021. We undertake no obligation to revise or update any forward-looking statements to reflect events or circumstances occurring after the date of this conference call.

With that, it's my pleasure to hand the call over to our CEO, Dr. Jim Breitmeyer..

Thank you Rich and good afternoon everyone. At Oncternal, we are committed to developing novel treatments for patients with cancer who have critical unmet medical needs. We are advancing a robust product pipeline with clinical and preclinical product candidates that target several such cancer indications.

We are particularly pleased with progress made during the second quarter of 2021 to advance the development of cirmtuzumab, our investigational, potentially first-in-class humanized monoclonal antibody that binds with high affinity to a biologically important epitope on ROR1, also known as receptor tyrosine kinase-like orphan receptor 1.

Encouraging updated interim clinical trial results with cirmtuzumab plus ibrutinib in patients with mantle cell lymphoma or MCL and chronic lymphocytic leukemia or CLL, were presented in a poster session at the ASCO 2021 Annual Meeting.

In addition, in July 2021, we opened a new treatment cohort of our ongoing Phase 1/2 study to evaluate cirmtuzumab plus ibrutinib in patients with MCL who are refractory to prior BTK inhibitor treatment, including ibrutinib, acalabrutinib or zanubrutinib and to include patients who are at high risk for progression having had an inadequate response to ibrutinib, that is only achieving stable disease or a partial response.

Our CMO Salim will provide additional details on each of these. We also have an ongoing dialogue with the U.S. FDA concerning the potential registration pathway for cirmtuzumab and we expect further feedback on a potential pivotal study design this year.

ROR1 has become an increasingly visible target in the oncology space and has been the subject of M&A activity, including the acquisition of VelosBio by Merck & Co. VLS-101, VelosBio's ROR1-targeted antibody drug conjugate, or ADC, was originally invented and developed at Oncternal and it incorporates the cirmtuzumab antibody to target ROR1.

We believe we have one of the most advanced and diverse pipelines targeting ROR1 in the industry today. We also continue to collaborate on two investigator-sponsored clinical studies of cirmtuzumab at UC San Diego.

First, a Phase 1b clinical trial of cirmtuzumab in combination with paclitaxel for the treatment of women with HER2-negative metastatic or locally advanced undetectable breast cancer. And second, a Phase 2 clinical trial of cirmtuzumab in combination with venetoclax, a BCL2 inhibitor in patients with relapsed/refractory CLL.

UCSD finished enrollment for the breast cancer study in the second quarter of this year. So moving on to our immuno-oncology cell therapy programs, we continue to make progress on our novel ROR1-targeting CAR-T and CAR-NK cell therapy candidates, moving them from the laboratory toward the clinic as planned.

We are very encouraged by the advancement of our cell therapy efforts, including successful recruitment of the internal team and external scientific advisors, preclinical activities with the Karolinska Institutet in Stockholm, Sweden, development and manufacturing activities with Lentigen Technology and Miltenyi Biotec, our research collaboration with UC San Diego and our development partnership with Shanghai Pharma Limited in Greater China.

We are tremendously excited by the potential of our cell therapy programs targeting ROR1, which may allow for the selective targeting of tumor cells that express ROR1 while sparing healthy tissues.

We also advanced the development of TK216, our investigational targeted small molecule inhibitor of the E26 transformation-specific or ETS family of oncoproteins. We presented encouraging interim clinical data for TK216 in patients with relapsed or refractory Ewing sarcoma in an oral session at the ASCO 2021 meeting.

Based on the data, we added an expansion cohort with an optimized dosing schedule. Salim will provide additional details on this program as well. During this past quarter, we further strengthened our executive team with two key additions in the medical and business fronts. Dr. Salim Yazji, joining us on the call now, is our new Chief Medical Officer.

Salim brings over 25 years of experience in both industry and academic settings, leading global oncology development and regulatory strategy throughout all phases of development, including various product approvals. Pablo Urbaneja joined us as our SVP of Corporate Development.

Pablo is a seasoned biotech professional with a solid track record in corporate strategy and licensing and he will lead our expanding strategy, portfolio and business development functions at Oncternal. With this, I will now turn the call over to Salim to provide more color on our clinical programs..

Thank you Jim. Good afternoon everyone. At this year's ASCO meeting, we announced updated clinical data for cirmtuzumab in combination with ibrutinib. In patients with relapsed/refractory MCL enrolled in our ongoing Phase 1/2 trial, the data cutoff at that time was April 16.

The best objective response, complete or partial response rate or ORR, was 83% for these heavily pretreated patients with MCL treated with cirmtuzumab plus ibrutinib, which compare favorably to historical ORR of 66% for ibrutinib monotherapy.

Seven of the 18 evaluable patients or 39%, had achieved a complete response or CR, by certain criteria, one of which was a complete metabolic response, CMR, by PET scan. These CRs remained durable for eight to 30-plus months. This compares favorably to the historical CR rate of 20% for ibrutinib monotherapy.

The median progression-free survival, PFS and overall survival, OS, were not reached for MCL patients. And the PFS estimate at two years was approximately 60% with a median follow-up of 18.9 months. This compares favorably to the historical PFS of ibrutinib monotherapy of approximately 30% with a median follow-up of 24 months.

For patients with CLL, the ORR was 94% and five patients had achieved the clinical criteria for complete responses with a bone marrow confirmation pending in one patient. The median PFS and OS has not been reached for CLL patients and the PFS estimate at two years was approximately 82% with the median follow-up of 22.1 months.

The combination of cirmtuzumab and ibrutinib continues to be well-tolerated with the safety profile consistent with or slightly improved compared to the historical data for ibrutinib monotherapy.

For example, in patients with MCL grade 3 and 4, neutrofil decrease was documented in 11.5% of the patients with cirmtuzumab plus ibrutinib, compared to 29% for ibrutinib alone from its registrational study. We and our study investigators continue to be particularly impressed by the response in heavily pretreated patients.

Six patients with MCL who has relapsed following prior autologous stem-cell transplant, or CAR-T therapy, were enrolled in our study and all six of them responded to the combination of cirmtuzumab and ibrutinib. Four patients achieved complete response and two patients achieved partial response.

All four patients who had received prior treatment with ibrutinib responded to the treatment with cirmtuzumab and ibrutinib with two CRs and two PRs.

We continue to support our Phase 1b investigator-initiated clinical trial in combination with paclitaxel for the treatment of women with HER2-negative metastatic or locally advanced undetectable breast cancer.

At AACR in April 2021, the UC San Diego investigators presented results showing an objective response rate of 57% with an encouraging toxicity profile.

These results were consistent with the previously reported interim results of the study and compared favorably to the historical results of single-agent paclitaxel, particularly for patients such as these who had received a median over six prior therapy for metastatic disease.

As Jim mentioned, this trial was fully enrolled for a total of 15 evaluable patients. The results are expected to be presented at a scientific conference or publication.

Also at AACR, we presented data from preclinical study investigating cirmtuzumab in combination with chemotherapeutic agents, cisplatin and paclitaxel, used to treat high grade serous ovarian cancer, HGSOC, an endometrial cell line in vitro.

Cirmtuzumab demonstrated single-agent activity and enhanced the anti-corrosive effect of chemotherapeutic agents in both ovarian and endometrial cancer cell models, including platinum-resistant ovarian cancer. Our program to develop TK216, our ETS family inhibitor, continues to progress.

At this year's ASCO meeting, we presented an updated clinical data from our ongoing Phase 1/2 trial of TK216 for patients whose relapsed/refractory Ewing sarcoma and the data cut for that was April 22. The data remains consistent and confirm and extends previous results.

Two patients who achieved CR remain with no evidence of disease, one for over 24 months and the other for over 14 months on a study. The treatments continue to be well-tolerated with reversible myelosuppression as the most common side effect.

Based on our encouraging data and KOLs' feedback, in July 2021 we added a new Phase 2 expansion cohort targeting Ewing sarcoma patients to evaluate clinical response to a single-agent TK216 using an optimized dosing regimen, treating for 28 days per cycle to intensify the amount of TK216 administered over time.

I will now turn the call over to Richard Vincent to review financial results and upcoming milestones..

Thank you Salim. In October 2017, CIRM awarded an $18.3 million grant to researchers at the UC San Diego School of Medicine to advance our Phase 1/2 clinical trial, evaluating cirmtuzumab in combination with ibrutinib for the treatment of patients with B-cell lymphoid malignancies, including MCL and CLL.

We are conducting this study in collaboration with UC San Diego and expect to receive approximately $14 million in development milestones under research sub-awards throughout the award period. In conjunction with this award, our grant revenue was $0.9 million for the second quarter ended June 30, 2021.

Our total operating expenses for the quarter ended June 30, 2021, were $8.6 million, including $1.8 million in non-cash stock-based compensation. Research and development expenses for the quarter totaled $5.2 million and general and administrative expenses totaled $3.4 million.

Net loss for the second quarter was $7.7 million or a loss of $0.16 per share, basic and diluted. As of June 30, we had $103.7 million in cash and cash equivalents. We believe these funds will be sufficient to support our operations into 2023. As of June 30, we had 49.4 million shares of common stock outstanding.

With respect to upcoming milestones for our cirmtuzumab program, we expect an interim clinical data update for the ongoing Phase 1/2 study in MCL and CLL at a scientific conference in the fourth quarter of 2021, a clinical data update from the fully enrolled ongoing breast cancer Phase 1b IST study, an FDA interaction update regarding a potential registration trial of cirmtuzumab in patients with MCL and further preclinical data in additional ROR1-expressing tumors.

On the cell therapies front, we are advancing our ROR1 CAR-T program to treat the first patient in the first half of 2022.

For our TK216 program, we expect an interim clinical data update for the ongoing Phase 1/2 expansion cohort in Ewing sarcoma at a scientific conference in the fourth quarter of 2021 as well as additional preclinical data and other ETS-driven tumors. Now I will turn the call back over to Jim..

Thank you Rich. In closing, this past quarter, we presented very encouraging data from our clinical programs. We have strengthened our management team and we continue to have a strong balance sheet and look forward to multiple potential catalysts in the coming months. Thank you for listening to our presentation today.

With that, I will turn things back to Darryl for the Q&A portion of this afternoon's call..

. Our first questions come from the line of Hartaj Singh with Oppenheimer. Please proceed with your questions..

Great. Thank you and thanks for the presentations, Jim and team. Jim, a couple of questions. One is, you sort of talked about earlier about the potential registrational trial for cirmtuzumab and ibrutinib in MCL.

Could you talk a little bit more about what the contours of that could look like, whether it would be in a proper Phase 3 drug trial, Phase 2, number of patients? How large could it be? I know you might not have the full information now.

But if you can just sort of give us an idea? And then, in your ROR1 CAR-T program, can you talk a little bit about how you expect to undertake the manufacturing of that for your patients as you dose them? Will it be sort of localized manufacturing at the various facilities where you are giving the CAR-T? Will it be more centralized manufacturing? And then, I have got a quick follow-up.

Thank you..

Thank you for your questions, Hartaj. So your first question regards a potential pivotal trial that we are actively discussing with the FDA. And as I said, we are hopeful that we may reach agreement on a study design during this calendar year. So certain elements are still being discussed.

But with both based on FDA feedback and discussions with KOLs and considering commercial considerations, we do believe that a randomized trial of cirmtuzumab plus ibrutinib versus ibrutinib is by far the most robust and best way to go forward toward approval. We are also carefully examining the ibrutinib response for patients with MCL.

And we believe that there is unmet medical need there where we could have a population of MCL patients that is more likely to progress on ibrutinib without, we think, having a dramatic reduction in the patient population for eventual commercial rollout. And then, I would say that the statistics are still being discussed with FDA.

But as you can imagine, for a randomized trial, it would probably be in the range of several hundred patients, let's say low single digit hundreds of patients, while we work out the particulars. So as far as CAR-T manufacturing is concerned, as I mentioned, we are working with Miltenyi.

And they are developing a very interesting technology that would permit local and regional processing of the cells.

And we are looking at, for example, the Miltenyi Prodigy system, which is a closed bench-top system where many of the steps to process the T-cells from the patient can be done in a fairly common GMP facility, not requiring brick-and-mortar.

So that's a leading example of what we are considering on the manufacturing side so that we can do the processing near where the patient will be located..

Great. Thank you Jim. And then just a quick question on the preclinical data you are going to present in the fourth quarter of additional ROR1-expressing tumors. Is that in the solid tumor domain, the liquid tumor domain? Or will you be looking combo or monotherapy there? And thank you for the questions..

Certainly Hartaj. So with Pablo Urbaneja's joining of the company and his strength in strategic planning, we are doing an extensive review of a number of indications where literature or existing preclinical data suggest that ROR1 inhibition could be clinically meaningful.

And it is including both solid and liquid tumors and it's including both monotherapy and combination therapies. And so with that, we are going to put each of those indications through the wringer, pressure test them and determine what makes the most sense to proceed with for our upcoming clinical indication or indications..

Great. Thank you Jim. I will get back in the queue..

Thank you Hartaj..

Thank you. Our next questions come from the line of Robert Burns with H.C. Wainwright. Please proceed with your questions..

Hi guys. Thanks for taking my questions and congrats on the quarter. Just two for me, if I may. First, you have framed expectations with regard to the update we are expected to see in 4Q for cirmtuzumab plus ibrutinib in MCL.

In particular, what the duration of follow-up will look like there? And any incremental data we may see? And then, my second question is, considering the data we have seen within the Phase 1 breast cancer study and now that's fully enrolled, can you discuss your current thoughts around next steps within breast cancer? Or if you are planning on pivoting to a different indication within the solid tumor space? Thank you..

Thanks for the question, Rob. I will answer the second one first and then turn over to Salim for the first one. So breast cancer is going to be one of, probably at this point, first among several indications that we are looking at in this strategic planning process.

And so we really like the breast cancer results and they are very encouraging, apparently, double the objective responses compared to paclitaxel alone with a good safety profile. So that's certainly something that we will think hard about building on.

So let me turn it over to Salim as far as how much follow-up and what we may be presenting in our next interim update..

Yes. Thank you Jim. Actually, I mean what's going to happen is we, most likely, are going to present the data at the next scientific conference. And as you know, we only can present the evaluable patients. They have to have at least one evaluation after two months of treatment.

So we would expect probably a handful of patients, additional patients to be presented at the end of the quarter. As you know, now we only have 18 evaluable patients for MCL and 34 evaluable patients for CLL. So for CLL, we are not going to have any more patients. But we will have more than 18 evaluable patients by the end of the quarter..

Awesome. Thanks for the color there, guys..

Sure. Thank you Rob..

Thank you. Our next questions come from the line of Carl Byrnes with Northland Securities. Please proceed with your questions..

Great. Thank you and congratulations on all the progress. Obviously, a number of conferences toward the end of the year, ASH in December, the San Antonio Breast Cancer Symposium also, I believe, in early December and then the CTOS symposium in November.

Would you anticipate any presentations prior to those events? And if so, what events might they be? Thanks..

Thank you Carl. And you did name the most likely venues for us to present in the fourth quarter. We have presented before their high profile, their great conferences. At this point, we don't have anything before that on the books. But we always keep our eyes open for opportunities to try to give updates when we can..

Great. Thanks. That's helpful. And also, looking back to cirmtuzumab for MCL with respect to registrational trial, just kind of assuming for the moment that the PFS numbers that we find is very high.

What might be done in terms of a trial design that wouldn't penalize you, if you will, for having a long PFS? In other words, if we want to accelerate something to market and you have got obviously PFS, progression free survival, of 2X, I believe, what could be done there? Thanks..

Yes. So great question, Carl. And so what we think is particularly interesting is that we have got a strong objective response rate and that is an endpoint that has been accepted by the FDA previously for accelerated approval.

And then we have this substantial improvement in progression-free survival, which is an endpoint that has been accepted for full approvals. And so we are considering that certain patients with MCL on ibrutinib have a shorter progression-free survival than average.

And so we may be able to further accentuate the difference in PFS by enrolling a population of MCL patients with unmet medical need..

And then would you also potentially be able to follow that up with kind of a post-surveillance for other patient populations to achieve kind of a more reflective PFS?.

Yes. The short answer is yes..

Cool. Great. Thanks so much. That's helpful..

Thank you Carl..

Thank you. . Our next questions come from the line of Kumar Raja with Brookline Capital Markets. Please proceed with your questions..

Thanks for taking my questions.

And with regard to the breast cancer trial, what do we know about the ROR1 expression in the patients who had a partial response? And also how does the previous treatment impact their ROR1 expression?.

Salim?.

Yes. So you are talking about the expression of ROR1 and tumor type? Just to clarify the question..

Yes. I understand that in the breast cancer trial, all of them had ROR1 expression based on IHC.

My question is like, is there a cutoff point where you are seeing the partial responses? And whether this can be optimized in a future trial so that you are selective for patients whom you think would be responsive?.

Yes. So just to actually kind of like confirm one point here, so the breast cancer study, it's an investigator-initiated study. But what we know is 100% of the patients who have been enrolled in the study have a ROR1 expression. And those patients actually have been heavily treated with a median about six prior therapy for their metastatic disease.

So when we try to enroll our patients, we try really to make sure that they have actually a ROR1, at least, expression because that's where the science and our antibody will work..

Is there a particular level of ROR1 expansion you are looking at like 50% of the cells? Or is there any cutoff like that?.

Yes. So as Jim mentioned earlier, actually we are going to do an exercise for multiple tumor types and we are going to be ranking them from multiple angles. And then we will choose the optimal tumor types that we are going to go forward with..

And in terms of the combination. Yes, please go ahead..

Yes. Kumar, to your specific question, the immunohistochemistry method has been undergoing method improvements over the course of the study. And so far, what we understand is that there hasn't been any correlation with the brightness of the ROR1 signal or the number of cells and the clinical response..

Okay. And in terms of the potential combinations, what do we know in terms of like how these combinations are sequenced? And what kind of impact they have on the ROR1 expression? Thank you..

Sure. So in a number of cases, there is evidence accumulating that ROR1 expression increases with each course of therapy for both hematologic and solid tumors. And the part of the ROR1 biology is that it is characteristic ROR1 expression is correlated, associated with a primitive phenotype.

And that primitive phenotype is also characteristic of drug-resistant cancer. So we do think that the ROR1 expression does go along with resistance to conventional therapy.

And there are several cases that we are exploring further now where there is a potential to either get an additive or synergistic effect with the next treatment or some interesting preliminary data that we are still working on to suggest that ROR1 inhibition may return tumor cells to a sensitive reaction to a therapy that they were previously resistant to.

So those are the sorts of things that we are looking hard at..

And in terms of the combination with venetoclax, what is the reason there? Thank you..

Salim?.

Yes. So actually, I mean, we are looking into multiple combination options. I mean, based on who are preclinical studies, like venetoclax is one of them, I mean, paclitaxel is the others. And plus other things that still are going now under investigation.

I mean the nice thing about our drug is it's actually the low-toxicity profile that make it very much combinable with a lot of other drugs that have been approved for treatment of a specific line of therapy..

No.

My question is with regard to any update in terms of enrollment? Or it's all mostly investigator-driven and you can't say anything at this point?.

You are talking about the investigational-sponsored study with venetoclax?.

Yes..

Yes. So far we have only four patients and we don't have any specific information there. As the enrollment there, it's not going as fast as we would like it to. But we have four patients in the study so far..

Okay. Great. Thank you so much..

You are welcome..

Thank you Kumar..

Thank you. There are no further questions at this time. With that, we do appreciate your participation. This does conclude today's teleconference. You may disconnect your lines at this time. Have a great evening..