BioCardia, Inc. (NASDAQ:BCDA) Q1 2023 Earnings Call Transcript May 10, 2023

Operator: Good day ladies and gentlemen, thank you for standing by. Good afternoon, and welcome to the BioCardia 2023 First Quarter Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] Participants of this call are advised that the audio of this conference call is being broadcast live over the internet and is also being recorded for playback purposes. A webcast replay of the call will be available approximately one hour after the end of the call through August 10, 2023. I would now like to turn the call over to Miranda Peto of BioCardia Investor Relations. Please go ahead, Miranda.

Miranda Peto: Good afternoon, and thank you for participating in today’s conference call. Joining me from BioCardia’s leadership team are Peter Altman, Ph.D., President and Chief Executive Officer; and Dave McClung, the Company’s Chief Financial Officer. During this call, management will be making forward-looking statements including statements that address BioCardia’s expectations for future performance and operational results, references to management’s intentions, beliefs, projections, outlook, analogies and current expectations. Such factors include, among others, the inherent uncertainties associated with developing new products, technologies and obtaining regulatory approvals. Forward-looking statements involve risks and other factors that may cause actual results to differ materially from these statements.

For more information about these risks, please refer to the risk factors and cautionary statements described in BioCardia’s reports on Form 10-K filed on March 29, 2023. The content of this time call contains time-sensitive information that is accurate only as of today, May 10, 2023. Except as required by law, the company disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call. It is now my pleasure to turn the call over to Peter Altman, Ph.D, BioCardia’s President and CEO. Peter, please go ahead.

Peter Altman: Thank you, Miranda, and good afternoon to everybody on the call. It has only been six weeks since our last call at the end of March, and BioCardia is steady as she goes. We have some near-term catalysts that we can detail progress towards as well as the broader opportunities for success ahead. BioCardia’s current efforts are focused on advancing its autologous and its allogeneic cell therapy platforms to treat significant unmet cardiovascular and pulmonary diseases, specifically ischemic heart failure, chronic myocardial ischemia, and acute respiratory distress syndrome. All of our cell-based therapies involve local delivery of the therapeutic to the heart or lungs, where we intend them to act locally. Heart failure is an enormous unmet need that affects more than 26 million people worldwide.

The latest blockbuster drugs in ischemic heart failure of reduced ejection fraction provide great benefits to patients, but don’t appear to have much of an impact on mortality. Patients in the published results of the pivotal trials for these new drugs have a cardiac mortality of roughly 7% and an all cause mortality of 10% per year regardless of whether they were treated or control patients. This makes clear that heart failure is still a problem in great need of new therapeutic solutions. Our autologous mononuclear cell therapy platform, which we call CardiAMP Cell Therapy is being advanced in two cardiac clinical indications. In preclinical studies, cardiac mononuclear cell therapy has been shown to release proteins locally within the tissue to facilitate cardiac recovery after heart damage with improvements in heart perfusion and contractile function.

All known previous clinical studies similar to the approach we are taking in our two lead CardiAMP Cell Therapy programs have shown patient benefits on average. In some of these studies, including our own, the benefits have been remarkable. The FDA has supported this promise by granting breakthrough device designation to CardiAMP Cell Therapy in the indication of ischemic heart failure, reduced ejection fraction. Advancing this and our other three therapeutic candidates is what we are all about. Our efforts to complete the CardiAMP Autologous Cell Therapy, pivotal clinical trials for the indications of heart failure or BCDA-01 and chronic myocardial ischemia or BCDA-02 are furthest along clinically. The CardiAMP Cell Therapy Heart Failure Trial, or BCDA-01, is a Phase 3 260-patient randomized controlled clinical study, intended to provide the primary data to support safety and efficacy in pursuit of marketing clearance.

Clinical investigators at 20 active partner sites across the United States and Canada have enrolled 120 patients today with 10 additional controlled patients having crossed over to receive therapy. We feel there is clearly increased momentum here, potentially driven by the clinical data presented at the American College of Cardiology in March, showing a 100% survival and patient benefits across many endpoints at two years, including a 35% increase in the heart left ventricular ejection fraction. As many know, we have been working on implementing an adaptive statistical analysis plan to the trial with distinguished consultants, including former FDA leaders and a respected statistical consulting group. In our last March 29 call, we were headed into a meeting scheduled to discuss the FDA’s comments on March 31.

That meeting went well. The discussion of the adaptive statistical analysis plan as provided was well received by the agency’s statisticians. The FDA’s primary concern was whether we would have enough safety data to support approval in an indication as large as ischemic heart failure with reduced ejection fraction if the trial was stopped early for efficacy. The agency’s primary concern with safety was with respect to the safety of the delivery of the cells. We shared with the FDA that we feel we do have sufficient data already with 353 interventions with our delivery system in the clinical indication of ischemic heart failure, reduced ejection fraction to date, and 129 patients treated so far with the cells being advanced in the CardiAMP trial.

The FDA was unaware of this more expensive data set and we agreed to detail it for them. We also worked with them on creative ideas to further enhance the safety experience ahead. After summarizing minutes from our perspective and acceptance of the FDA minutes provided, we submitted a revised supplement for the adaptive statistical analysis plan incorporating all of the comments from the agency on April 26. We now anticipate a response from the agency on May 26th. The next pre-specified formal Data Safety Monitoring Board Review is anticipated the end of June, 2023. We still believe it is likely we will be able to have the adaptive statistical analysis plan in place for the meeting. The specific details of any potential adaptive statistical analysis plan in combination with any modifications to the Data Safety Monitoring Board charter will dictate what happens at this next and subsequent Data Safety Monitoring Board reviews.

As the CardiAMP Cell Therapy heart failure trial was over 90% powered for success with a range 86 patients to 126 patients, there is potential that the trial could meet its primary efficacy endpoint on the patients that have been enrolled to date. Although the next data review event has potential to be a great success if the trial has stopped early for efficacy, the review will also be a success should the trial continue as planned. Our second therapeutic program with the same autologous cell therapy for the treatment of chronic myocardial ischemia with refractory angina or BCDA-02. The CardiAMP chronic myocardial ischemia trial is a Phase 3 multicenter, randomized, double-blinded controlled study of up to 343 patients at up to 40 clinical sites.

A sufficient number of patients to complete the open-label rolling cohort have already been consented. It has anticipated this trial will report out the open-label roll-in cohort results in 2023. As we have shared previously in July, we had our second consultation with Japan’s Pharmaceutical and Medical Device Agency regarding registration of CardiAMP Cell Therapy for ischemic heart failure. BioCardia still expects to complete a formal submission towards Japanese approval in the second quarter of 2023. In Japan, another autologous cell therapy has received conditional approval for heart failure based on seven patients treated, and these treatments require open heart surgery to access the heart. Although our clinical data is from overseas, we have treated far more patients in rigorous controlled trials and have a minimally invasive procedure with our Helix Biotherapeutic Delivery System.

Our cell processing platform is approved in Japan already for therapeutic applications for non-cardiac indications by our partner Zimmer Biomet and our minimally invasive Helix Biotherapeutic Delivery System is approved in the European Union. Our feeling is that there are many reasons that Japan PMDA should be inclined to approve CardiAMP Cell Therapy for the benefit of patients and to continue to advance Japan’s leadership in regenerative medicine therapies. Now, I’d like to move to our two allogeneic cell therapy product candidates based on our allogeneic Neurokinin-1 Receptor Positive mesenchymal stem cells platform. These are off the shelf cells from young healthy donors intended to be expanded to produce many doses for many patients.

The Neurokinin-1 Receptor Positive mesenchymal stem cells are particularly interesting as Neurokinin-1 is the primary receptor for Substance P, an important neuropeptide mediator of inflammation, which plays a central role in both heart failure and regenerative processes following myocardial injury. I encourage listeners to Google Substance P, to understand why advancing the mesenchymal stem cells that bind to this neuropeptide is exciting. Our allogeneic mesenchymal stem cell program in ischemic ideology heart failure of reduced ejection fraction is designated as BCDA-03. This is a Phase 1/2, multi-center, randomized, double-blinded, controlled study of up to 69 patients, designed to assess the safety and efficacy of this therapeutic candidate.

The investigational new drug application was approved by the FDA in December, 2022. The trial is designed for patients in eligible for the company’s Phase 3 CardiAMP Heart Failure Trial studying autologous cell therapy. Clinical grade allogeneic cells have been manufactured in our Sunnyvale facility and are ready for use. These cells will be delivered under the protocol with our proprietary minimally invasive biotherapeutic delivery system. We still expect to begin enrolling patients in the second quarter of 2023, which has seven weeks remaining. Our allogeneic mesenchymal stem cell program in patients recovering from acute respiratory distress syndrome, which we have designated BCDA-04 was approved by the FDA in April 2022, to treat patients.

The trial is a Phase 1 multi-center open-label study of up to nine patients. While the number of patients with COVID-induced ARDS has decreased, ARDS’ unrelated to COVID is still significantly impacting patients. The company intends to work with the FDA to modify the study eligibility criteria to include these patients. In this trial, increasing dosages of the cells will be initially evaluated and then the optimal dose will be taken to Phase 2 in a randomized study in adult patients recovering from ARDS. This therapy is intended to address the enormous unmet need of sustained, local and systemic inflammation, after a patient is taken off respiratory support, with the goals of accelerating recovery, enhancing survival, and reducing both relapse and rehospitalisation.

Clinical grade cells are also ready for use in this study. The ARDS trial is expected to commence following the initiation of BCDA-03, studying these allogeneic mesenchymal stem cells for heart failure. In summary, we are advancing four clinical stage therapeutic product candidates that address important unmet cardiac and pulmonary diseases, based on our autologous and our allogeneic cell therapy platforms. From these therapeutic development efforts, we now have four active business development initiatives. First is partnering our CardiAMP cell therapy platform internationally. Second, is licensing out our clinical stage Neurokinin-1 Receptor Positive mesenchymal stem cells platform for other clinical indications, which is shown promise with other mesenchymal stem cell preparations.

Third is licensing our catheter-based biotherapeutic delivery systems for cell gene and protein therapy candidates to the heart, such as in the BlueRock relationship we began last year. And fourth, is monetizing our Avance transseptal introducer sheath product. We are also looking forward to announcing an additional patent issuance related to our Helix Biotherapeutic delivery platform and feel very good about our broader intellectual property estate. I will now pass the call to David McClung, our CFO who will review our Q1 2023 financial results. David?

Dave McClung: Thank you Peter, and good afternoon everyone. Revenues were approximately $64,000 for the three months ended March 31, 2023 comparable to the $60,000 for the three months ended March 31, 2022. Research and development expenses increased to approximately $2.4 million in the first quarter of 2023 compared to approximately $2.2 million in the first quarter of 2022, primarily due to expected increases in support of the CardiAMP Heart Failure Trial. SG&A expenses remained at approximately $1.2 million in the first quarter of 2023 comparable to the same amount in the first quarter of 2022. Our net loss was approximately $3.6 million in Q1 2023 and as compared to $3.3 million in the first quarter of 2022. And net cash used in operations during the quarter was approximately $2.6 million as compared to approximately $2.9 million in the first quarter of 2022.

BioCardia ended the quarter with approximately $4.9 million in cash and cash equivalents providing runway into Q3 without additional capital or funding from business development activities that Peter touched on in his remarks. This concludes management’s prepared comments. We’re ready to take questions.

Q&A Session

Operator: Thank you. [Operator Instructions] Our first question comes from Joe Pantginis with H.C. Wainwright. Please go ahead.

Operator: The next question comes from Kumar Raja with Roth Capital. Please go ahead.

Operator: [Operator Instructions] Our next question comes from Laura Suriel with Alliance Global Partners. Please go ahead.

Operator: Yes, we have no further questions. I would now like to turn the conference back over to Peter Altman for any closing remarks.

Peter Altman: I want to thank all of you for participating in today’s call and for your interest in BioCardia. We do look forward to sharing our continued progress. Stay healthy, be kind, and have a wonderful afternoon.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may all now disconnect.