Plus Therapeutics, Inc. (NASDAQ:PSTV) Q3 2023 Earnings Call Transcript

Plus Therapeutics, Inc. (NASDAQ:PSTV) Q3 2023 Earnings Call Transcript October 31, 2023

Operator: Good afternoon, ladies and gentlemen. Welcome to the Plus Therapeutics Third Quarter 2023 Results Conference Call. Before we begin, we want to advise you that over the course of the call and question-and-answer session, forward-looking statements will be made regarding events, trends, business prospects and financial performance, which may affect Plus Therapeutics’ future operating results and financial position. All such statements are subject to risks and uncertainties, including the risks and uncertainties described under the Risk Factors section included in Plus Therapeutics’ annual report on Form 10-K and quarterly reports on Form 10-Q filed with the Securities and Exchange Commission from time to time. Plus Therapeutics advises you to review these risk factors and considering such statements Plus Therapeutics assumes no responsibility to update or revise any forward-looking statements to reflect events, trends or circumstances after the date they are made.

It is now my pleasure to turn the floor over to Dr. Marc Hedrick, Plus Therapeutics’ President and Chief Executive Officer. Sir, you may begin.

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Marc Hedrick: Thank you, Tawanda. Good afternoon, everyone. Thank you once again for taking time to join us today as we provide an overview of recent business highlights and discuss our 2023 third quarter financial results. Joining me for the call today are Mr. Andrew Sims, our Chief Financial Officer; and Dr. Norman LaFrance, our Chief Medical Officer. I’ll begin the call by reviewing our recent clinical and regulatory progress with a focus on the third quarter and then turn the call over to Andrew to review our financials. Dr. LaFrance will then be joining us for Q&A. I’ll begin with updates on our two lead radiotherapeutic CNS cancer programs, starting with recurrent glioblastoma rGBM. Our ReSPECT-GBM trial of Rhenium-186 Obisbemeda in patients with GBM funded substantially by the [Technical Difficulty] it is to enroll as we work to add new sites in order to complete enrollment of the Phase II by the end of 2024.

In parallel to the active Phase II trial, the Phase I dose escalation trial continues to enroll. Assessing the effects of very high administered radiation doses in large volumes to bigger size tumors on radiation distribution, tumor coverage and safety. We presented an update on the ReSPECT-GBM trial at the Society for Neuro-Oncology ASCO meeting in August. To summarize the safety data, a single administration of Rhenium-186 Obisbemeda is generally well tolerated with no dose-limiting toxicities and minimal systemic radiation exposure across 34 GBM patients. In addition, no patients experienced treatment-related adverse events with the outcome of death and no patients withdrew due to AEs. Most AEs were mild or moderate in intensity and nonserious.

The maximum tolerated dose was not reached. With regard to efficacy, as we briefly discussed last quarter, we found that overall survival is highly correlated with absorbed dose and treated tumor volume. In the data set presented at SNO/ASCO, the median absorbed radiation dose to the tumor was 308 gray. When we look at the median overall survival in the Phase I trial through Cohort 6, for patients with absorbed doses less than 100 grey, median overall survival was 22 weeks or about five months. And in contrast for patients with absorbed doses greater than 100 gray, median overall survival was 70 weeks or almost 18 months. Applying the Cox proportional hazard statistical model, we have found that for each 100 gray increase in total absorbed dose, the risk of death decreased by 45.6% and for each 10% increase in the ratio of treated to total tumor volume, the risk of death decreased by 66.9%.

This data can be found in much greater detail on our website. In addition, we continue to assess data from the ongoing Phase II trial. New safety and efficacy data from the Phase II will be presented at SNO in November. Following the SNO meeting, we will be hosting a key opinion leader webinar of investigators to discuss the data in detail. This webinar will feature Neuro-Oncology expert, Dr. Andrew Brenner, who is a principal investigator on the trial and is presenting the data at SNO as well as others. We’ll be sharing the details of this event soon and invite you to join us as we delve into the data with these experts more deeply. Now let me update you on our ReSPECT-LM Phase I/IIa dose escalation trial of Rhenium Obisbemeda for patients with leptomeningeal metastases or LM.

This is a trial that is substantially funded by the State of Texas through CPRIT. Following a successful FDA Type C meeting in Q3, we rapidly completed Cohort 4 in the LM trial. Cohort 4 is the first of four planned cohorts in Part B of the Phase I trial. Completing the dosing in Cohort 4 was the fastest enrollment of all the cohorts to-date and enthusiasm from sites to participate enroll patients remains high. Prior to our FDA meeting, we completed Part A of the Phase I trial, specifically cohorts one through three. This past August, we presented the results of these cohorts at the SNO/ASCO meeting and provided further explanation and context at the KOL roundtable event following the August meeting. In summary, for the first three cohorts, the data shows a favorable safety profile and no dose-limiting toxicities have been reached.

Pharmacokinetic analysis showed that the drug circulated rapidly throughout the CSF space and remained there for at least seven days following single administration. Using the CNSide tumor cell enumeration assay, we found that an average reduction of tumor cell counts at 28 days post-treatment of 53%. And finally, median overall survival was 10 months with five of 10 patients still alive. We also presented LM data at the CPRIT innovations in cancer [Technical Difficulty] in September. As mentioned, the ReSPECT-LM Phase I program continues to be funded in part by CPRIT through a three-year $17.6 million product development research funding award. In September, we received a planned $1.9 million advanced payment as part of the grant contract.

Andrew will discuss the forecasted grant revenue going forward for the next couple of years in a moment. Now I’ll provide some further color on the CNSide assay used in our LM trial and the license agreement we negotiated for the assay in August. Taking a look at the big picture first. The diagnosis of LM and the monitoring of treatment response are notoriously difficult in LM even with our state-of-the-art imaging clinical evaluation and traditional cerebrospinal fluid evaluation. In contrast, the CNSide assay is highly specific and sensitive as a measure of CSF tumor cell enumeration that quantitates a number of tumor cells per mL of CSF. This technology represents a substantial improvement in assessing CSF tumor cells compared to the standard of care.

At Plus, although we are initially pretty skeptical of the value of the technology and use it as a potential secondary endpoint, our team has seen the value of the assay first-hand in our LM trial and to paraphrase one of our LM trial investigators, the CNSide assay is a “game changer” for LM disease diagnosis and monitoring. And therefore, it’s obviously quite synergistic with our therapeutic approach. The company that developed the test Biocept, those has been in financial distress throughout 2023 and declared their insolvency earlier this month. I want to make it clear that the company’s financial distress was not in any way based on the quality of the utility of the assay, but upon a variety of unrelated factors. However, prior to Biocept’s announcement and because of this very concern, Plus successfully completed the transfer of all proprietary materials [Technical Difficulty] and equipment from Biocept to use the CNSide assay.

And now as per our plan, we’re the test to no longer be commercially available to us, as it is not now, Plus can now begin CSF tumor cell enumeration testing limited to the ReSPECT-LM trial patients. Separately, we will consider whether to exercise the exclusivity option that we have which is exercisable through the end of 2024 under the current license. In the meantime, we’ll monitor the insolvency proceedings closely. Now back to our LM trial. We plan to initiate dosing in Cohort 5 this quarter pending DSMB approval. In terms of next step for ReSPECT-LM, we will continue to focus on enrollment, site on-boarding, data assessment and planning for next steps, including Phase II. In terms of our pediatric trial, we continue to make steady progress in initiating our first in child pediatric brain cancer trial.

Travel initiation is behind our original schedule as the FDA has required substantially more supporting data from us, particularly from our ongoing trials. We had a positive follow-up meeting in Q3, and all FDA requests are both reasonable and satisfactorily addressable within the next quarter. Thereafter, pending IND clearance from the FDA anticipated to be in early 2024, we plan to initiate the Phase I ReSPECT pediatric brain cancer trial for pediatric patients with the ependymoma and high-grade glioma at Lurie Children’s Hospital in Chicago. Our other novel radiotherapeutic Rhenium-188 nanoliposome biodegradable alginate microsphere or BAM for short continues to make regulatory development progress. As a reminder, BAM is a radioembolization compound designed to treat a variety of solid organ tumors.

We recently received feedback from the FDA regarding its regulatory designation and the BAM radioembolic product will be regulated as a device, primarily by CDRH. We view this as very good news as the clinical requirements and timeline for approval will be reduced in existing reimbursement paths are already in place. Our 2024 corporate goals for BAM will include specific guidance for development based on FDA — the FDA regulatory decision. Now in terms of drug production, behind the scenes, we continue to expand and shore up existing supply agreements and work to build in across-the-board supply chain redundancy, including as it relates to isotope availability. As we complete new agreements or relationships, we will communicate those. And with that, I’ll turn the call over to our Chief Financial Officer, Andrew Sims, who will review the financials.

Andrew?

Andrew Sims: Thank you, Marc. Good afternoon, everyone. Please refer to our press release issued earlier today for a summary of our financial results for the third quarter ended September 30, 2023. As of September 30, 2023, cash and cash equivalents were $11 million, which is in line with the balance at June 30, 2023. In addition, as of today, Plus has met the requirements to receive the next cash advance from CPRIT of $3.3 million, which we expect to receive prior to reporting our 2023 full year results. Plus also remains on track to receive additional advances in 2024, amounting to a further [Technical Difficulty] to a total of $10.2 million incremental non-dilutive cash grant funding is expected between today and December 31, 2024 from CPRIT.

In addition, the company continues to benefit from the 3 million grant from the NIH to support the GBM trial through Phase II, which is expected to be fully utilized by the end of 2024 to coincide with the completion of the ongoing Phase II trial. Based on the cash on hand and committed grant funding, our current balance sheet provides runway well into 2025. In addition, the company continues to be aggressive in the pursuit of additional NIH and separate grants to support both our current and planned future programs. Our practice will be to continue to announce those upon award. The company recognized $1.2 million of grant revenue in the third quarter of 2023 and $3.6 million year-to-date 2023. The company forecasts grant revenue of between $1 million to $1.5 million in Q4 2023 and between $6 million to $7 million for calendar year 2024.

Total operating expenses for the third quarter of 2023 decreased by $0.7 million to $4.5 million in 2023. Compared to total operating expenses of $5.2 million for the same period the prior year. The decrease is due primarily to the completion of the CGMP drug development in 2022. Other income totalling 32,000 for the quarter includes 119,000 of interest income, which fully offsets the interest expense on the remaining principal on the Oxford debt. So with the grant support our existing go-forward burn is close to 500,000 over the next 18 months. Net loss for the third quarter of 2023 was $3.2 million or $1 per share compared to a net loss of $5.2 million or $2.85 per share for the same period of the prior year. Now I’ll turn it back to you Marc.

Marc Hedrick: Thank you, Andrew. Before we move on to Q&A, I’ll take a moment to provide guidance on anticipated milestones over the next 14 months. First of all, in Q4, we have multiple presentations accepted at the SNO Annual Meeting, November 15 to 19 in Vancouver. We’re particularly excited to present the first data cut from the ongoing Phase II GBM trial to be accompanied [Technical Difficlty] at our thought leader panel and we’ll put out the specifics about that panel when finalized. Also the SNO annual meeting in November, we will also have an update on our LM trial as well. Looking beyond the SNO meeting and looking forward into 2024, we intend to complete enrollment in the Phase II ReSPECT-GBM trial and finalize a pivotal trial design with the FDA.

We also intend to complete enrollment in the Phase I ReSPECT-LM trial and begin the Phase II trial. We also intend to complete internal implementation of the CNSide cerebrospinal fluid tumor cell enumeration assay that has been currently utilized in the ReSPECT-LM clinical trial. We intend to obtain FDA IND approval and initiate the Phase I ReSPECT pediatric brain cancer trial for pediatric patients with ependymoma and high-grade glioma at the Lurie Children’s Hospital in Chicago. We also will complete key development milestones for the company’s next-generation radioembolic device, 188RNL-BAM. At a key second source, GMP supply chain partner to support late stage clinical trials of commercial supply and publish the ReSPECT-GBM Phase I data in a peer-reviewed publication.

Now with that I’ll turn it back to Tawanda, the operator for our Q&A session.

Operator: Thank you. [Operator Instructions] Our first question comes from the line of Justin Walsh with Jones Trading. Your line is open.

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Q&A Session

Justin Walsh: Hi. Thanks for taking the questions and congrats on the progress. I’m wondering if you can provide any color on what we can expect from the presentations at SNO? I know you mentioned survival data for 15 patients, but if there’s any other info you can close ahead of the release and maybe remind us of how many patients’ worth of data we saw last time you guys presented?

Marc Hedrick: Hey, Justin, last time we presented data, there were 34 patients at a high level, 34 total patients treated in the trial. We have five abstracts accepted. Besides presenting the Phase II data set from a safety and efficacy perspective, one novel thing we’ll show is some pretty substantial updated imaging data, and that will be part of the presentation. So this will be across multiple presentations. I can’t really say any more than that as we continue to review the data. But one reason we’re having a thought leader panel is we’ll be able to bring a lot of that data that will be novel and put it into context with some of the investigators that are actually involved in patient care.

Justin Walsh: Great. Really looking forward to all that. So one more question for me. Obviously, there’s been some building momentum in the radiopharma field with M&A activity and some key data releases. Wondering if you’ve seen an increase in interest in your ongoing trials from perspective of patients, physicians and investors.

Marc Hedrick: Yes. So we’ve seen a lot of interest in our CNS radiotherapeutic assets. And I think there are several reasons for that. You mentioned one, which is there’s a renewed interest generally speaking, in the radiotherapeutic space. And Dr. LaFrance, who’s sitting with me today has been in the space for a while. And I think would tell you that it’s been a remarkable increase in interest over the last few years that he’s seen. The second thing is in the radiotherapeutic space, there’s a lot of work at preclinical. There are a number of very successful products and deals that have been announced. But there is a relative dearth of mid-stage assets. And I think that’s one reason we’ve seen a lot of interest in our technology and that we have an ongoing Phase II in GBM.

A very big indication and also LM, which is rapidly getting through the Phase I to Phase II. So that’s I think that’s created a lot of interest. And then finally, just the data itself. These are unmet medical needs that carry very high levels of mortality. There’s nothing approved for LM and there’s only been one approved drug for GBM in the last 10 years, which doesn’t improve survival. It just improves the symptomatology. So I think the combination of those three things has really created a lot of renewed interest in this space.

Justin Walsh: Great. Thanks for taking the questions.

Operator: Thank you. Please standby for our next question. Our next question comes from the line of Sean Lee with H.C. Wainwright. Your line is open.

Sean Lee: Good afternoon, guys, and thanks for taking my questions. First one, during the prepared remarks, you mentioned that the FDA requested additional info from both your existing studies and also for the upcoming pediatric study. Could you provide a bit more information on what was requested.

Marc Hedrick: Norman, would you like to take that?

Norman LaFrance: Hi, Sean. Thanks for the question. The FDA has always liked our approach for the dose escalation in pediatric tumors, which, as everyone knows, are not the same as adult tumors. And our plan is to do a dose escalation, not only an administered dose, but in volume. But as part of that, and as folks know FDA is very conservative, particularly around pediatric dosimetry and radiation treatment. As Marc has mentioned, we have a very well-established pulmonary database in the GBM adult trial. And what we did with FDA is review the adult dosimetry trial, review the adult safety data, which is very well tolerated and quite benign and pointing out to FDA that the — it will be an identical product administered in an identical way with the CED catheters has been quite a success story in adults.

When they got that information, they were very satisfied. We have an agreement to move forward in the protocol design and are just finishing up some minor clarifications with them, which we’ll do this quarter and to that point, we expect to start the pediatric trial early next year.

Sean Lee: Great. Thank you. That makes it much clearer. My second question is on the funding side. You mentioned that approximately $10 million additional for CPRIT next year as well, $3 million for NIH. Would that cover the majority of the expected Phase II study expenses for next year?

Andrew Sims: Thanks, Sean. So the short answer is yes. So separate funds, so let me just kind of give you a background of CPRIT then the timing. So CPRIT funds, two-thirds of all costs relating to the study. So which makes the grant extremely attractive, obviously. Currently, they cover effectively the majority of the third-party development costs, patient costs, drug costs, site initiation fees, et cetera, regulatory costs. And then they also cover significant internal costs, salaries and other overhead rent, IT, et cetera. And as we look forward and I kind of mentioned we would — we should receive over $10.2 million over the next 15 months that will cover just under 70% of the total costs.

Sean Lee: Great. My last question is just on the dose escalation study. I know previously you guys weren’t sure whether the current cohort will be the highest cohort. So I was wondering, would you go even higher in that study? And also what’s, remember, you guys also mentioned that you had a protocol for retreating patients. Is that also planned for a different cohort?

Marc Hedrick: Hi, Sean, it’s Marc. On the first question where we’ve got another couple of patients to complete 6 in cohort 8. We’re at very high radiation doses and volumes. And we’ll have to look at the data. But my guess is we won’t get to a maximum tolerated dose, but we very likely will get to a maximum feasible dose. And so data will be analyzed primarily for safety and distribution. So anyway that’s ongoing. As it relates to retreatment, so we’re in the process of putting a retreatment arm in all of our GBM sites with the idea that — and I don’t want to say too much and pre-empt some of the data at SNO. But we’re going to show imaging data that I think will be very interesting and we’ll can help provide a road map for achieving what is our primary corporate goal and that’s to turn CNS cancers into a chronic disease.

I will say that as it relates to the Phase II, if I can just editorialize a minute that I think we’re on track to complete the single administration Phase II by the end of 2024. If that data continues to look positive, we’ll present that data in the first pass of that at SNO. We may actually seek a pre-end of Phase II meeting with the FDA to discuss options for.

Sean Lee: Great. That’s all I have and thanks again for taking my questions.

Operator: Thank you. Please standby for our next question. Our next question comes from the line of Edward Woo with Ascendiant Capital. Your line is open.

Edward Woo: Yeah, congratulations on the progress. To clarify you said that Cohort 4 the LM trial was the fastest that you were able to get it filled. Is that something that you should expect going forward and does that speed up your time line at all with LM trial?

Norman LaFrance: Hi, Ed. This is Norman. Great question. And the — as I think we’ve discussed previously, there are protocol defined up [Technical Difficulty] that we agreed to with FDA because this is first-in-man intrathecal administration of, obviously, the radio activity. Given the interest that Marc alluded to earlier and a question on an earlier Q&A question, we’re getting a lot of interest on folks for the exact reason Marc mentioned that, first of all, there are really no treatments for this devastating complication. And there really are no significant active investigative trials other than ours. And we’ve gotten a very promising provocative efficacy signal in addition to being a very well-tolerated outpatient treatment.

So the short of it for the Cohorts now five through seven to be continued. We’d expect to enroll at the same rate. With that, we’d expect if there are no DLTs or other safety observations that may call the decision to end in an earlier Cohort, say, Cohort 6 will complete the full dose escalation probably by June of next year. With that, we’ll go to FDA and have an end of Phase I dose escalation and Pre-Phase II meeting and I don’t want to get too forward-looking. But given the current trend of both the safety, tolerability and preliminary efficacy will be in a position to talk to FDA about a Phase II trial that will include it being [Technical Difficulty] leading to an accelerated approval all because LM has no treatment options, is a devastating complication and not a lot of investigative.

At this point, I’ll stop there, and see if you have any other questions.

Edward Woo: Thank you very much. That was very helpful. I wish you guys good luck. Thank you.

Operator: Thank you. Please standby for our next question. Our next question comes from the line of Jason McCarthy with Maxim Group. Your line is open.

Unidentified Analyst: Hi, guys. It’s Chad on for Jason. Sorry if it was already covered, but I was just wondering what the plans are for implementing CNSide in the LM study given that Biocept has declared bankruptcy, will you still be able to use the platform?

Marc Hedrick: Hi, Chad. Yes. So you’re right. They declared bankruptcy. We’ve been using the test for over a year and I did mention a bit in my prepared remarks, but I’ll expand on those. We didn’t really know what to expect. We started using the trial, the test, but over a year or so of experienced both with our technology and our trial and talking to the investigators, we think there’s a real opportunity with this test. We were concerned about them their solvency over the past year. And that’s why we, frankly, licensed and transferred the technology to ourselves in the weeks before they declared insolvency. So we essentially have a nonexclusive right to use the test for — in our trials with our technology and then we have an option that’s exercisable through the end of next year to gain exclusivity in the area of radiotherapeutics for this test.

So now that they’re gone, and they are gone, they’re no longer operating. We’ll be taking the protocols, the information and the testing kits that we have already acquired and are now in Texas and we’ll begin using the test, not in a CLIA fashion, but just as a research tool, so we can use in the context of our trial. Now with our option based on kind of our ongoing experience, we will actually consider whether we want to exercise that and maybe expand that. But right now, I think, the plan is just to implement it and use it in our trial and frankly CPRIT ought to pay for that as well.

Unidentified Analyst: Okay. Great. Thanks for taking the question and congrats on the progress.

Marc Hedrick: Okay. Thank you.

Operator: Thank you. I’m showing no further questions in the queue. I would now like to turn the call back over to Marc for closing remarks.

Marc Hedrick: Thank you, Tawanda. Thanks, everyone for joining us. Thanks for the good questions. Thanks for your interest in the company and we will be talking to you soon. Have a nice evening. Goodbye.

Operator: Ladies and gentlemen, this concludes today’s conference call. Thank you for your participation. You may now disconnect.