BiomX Inc. (PHGE) Earnings Call Transcript & Summary

Greetings, and welcome to today's BiomX investor presentation. [Operator Instructions] As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to your host, Marina Wolfson, Chief Financial Officer. Marina, please go ahead.

Thank you for joining us today to discuss the positive top-line results from our ongoing Phase II trial evaluating BX211 for the treatment of Staphylococcus aureus infections in patients with diabetic foot osteomyelitis or DFO. Earlier today, BiomX issued a press release detailing top-line results from the Phase II study that became available just after 6:30 a.m. Eastern Time. In addition, the presentation slides used on this call can be found on our website at biomx.com. BiomX also issued a press release on 2024 fourth quarter and full-year financials and program updates on March 25. A replay of this call will be available on the Investors section of our website. As we begin, I'd like to review the safe harbor provisions. All statements on this call that are not factual historic statements may be deemed forward-looking statements. For instance, we're using forward-looking statements when we discuss on the conference call, the sufficiency of the company's cash, our pipeline, the design, recruitment, aim, expected timing and interim and final results of our preclinical and clinical trials, the potential benefits and the potential safety and efficacy of our product candidates, BX004 and BX211 as well as the potential outcomes of discussions that we may have with the U.S. Food and Drug Administration or FDA and foreign regulatory agencies and timing thereof. In addition, past and current preclinical and clinical results as well as compassionate use are not indicative and do not guarantee the future success of our clinical trials. Except as required by law, we do not undertake to update forward-looking statements. The full safe harbor provisions, including risks that could cause actual results to differ from these forward-looking statements, are outlined in today's press release, which, as noted earlier, is on our website. Joining me on the call this morning is BiomX's Chief Executive Officer, Jonathan Solomon, to whom I will now turn over the call to discuss the positive DFO readout.

Thank you, Marina, and good morning, everyone. To begin, I'd like to give a brief overview of BiomX's activities. BiomX is developing customized phage therapies to eradicate harmful bacteria and chronic diseases. Our 2 lead programs target the unmet needs of patients with cystic fibrosis and diabetic foot osteomyelitis with BX004 and BX211, respectively. Both programs have now successfully completed Phase II trials, and today, we will take the time to focus on the readout of the Phase II results of BX211 oriented to meet the need of patients with DFO associated with Staphylococcus aureus. We are fortunate to have great investors and partners on the path to making phage widely available and accessible, just to mention a few: Deerfield Management, the Antimicrobial Resistance Action Fund, the Cystic Fibrosis Foundation, the Defense Health Agency, or DHA, and many others. Next slide. This morning, we announced positive top-line results from our Phase II trial evaluating BX211, a phage treatment for Staphylococcus aureus infections in patients with DFO. The results are a watershed moment for phage therapy. BX211 demonstrates statistical significance across several key parameters for DFO treatment and showed positive trends across multiple additional clinical parameters, collectively presenting a strong, compelling and comprehensive data set. We believe this data represents one of the strongest demonstrations to date of the therapeutic potential of phage therapy. Next slide. Diabetic foot infections, DFI, is an infection of the soft tissue in patients with diabetes that begin as a superficial ulcer and then deepens and extends into the subcutaneous layer. As these infections further penetrate and spread into the bone, they are then characterized as DFO. Staphylococcus aureus infections are the main contributor to morbidity and mortality of patients with DFI and DFO. Current standard of care for these patients includes hospitalization and debridement of these wounds alongside antibiotic treatment. However, treatment success is limited, with 20% to 40% of these cases eventually resulting in patient limb amputations. Next slide. The numbers are astounding and show the extent of the substantial unmet need for patients. In the U.S., there are more than 38 million individuals diagnosed with diabetes and 400,000 diabetic foot infections, ER visits annually and approximately 160,000 lower limb amputations in diabetic patients. Approximately 85% of amputations in diabetic patients are due to DFO or diabetic foot infection. Financially, the toll is huge, with each amputation entailing direct costs of approximately USD 50,000 per patient. The total financial burden on the U.S. health care system due to diabetic amputation is approximately USD 8 billion annually, a staggering figure. Sadly, DFO or DFI patients that undergo amputation have an increased 5-year mortality rate of 30% to 50%, and any episode of lower limb amputation is a major risk factor for subsequent amputation. Next slide. Given the unmet need, it is surprising that no new drugs have been approved for the last 20 years. Furthermore, all the drugs were approved for DFI on the basis of non-inferiority to older antibiotics. Hence, there has been no real innovation in the field for more than 2 decades. Needless to say, in DFO, there are no drugs approved at all. Next slide. In meeting the huge unmet need for patients, we should look at the key drivers of treatment failure, which are the formation of biofilm, poor blood supply, general antibiotic resistance. Staph aureus forms biofilm patches and diabetic foot ulcers represented here in blue. Bacteria are represented in green. Biofilm creates a shield that is ten to thousandfold more resistant to antibiotics compared to free-floating individual cells, which are not part of the biofilm. Treatment is further complicated given poor blood supply, which limits the localized concentration and effectiveness of systemically administered IV or oral antibiotics, and many of these patients have antibiotic-resistant Staph aureus. Overall, half of chronic cases of DFO/DFI involve Staph aureus, mostly due to the rapidity of the microorganism, doubling time and virulence factors. We believe the bacteriophage advantage includes the ability to break bacterial biofilm formation in addition to its effectiveness against antibiotic-resistant bacteria. Once at the site of infection, phage microorganisms have the added advantage of replicating as they eliminate bacteria and, hence, amplify their concentration at the difficult-to-reach infection site. Next slide. BX211 is our proprietary phage treatment that has been formulated to meet the needs of patients with DFO associated with Staph aureus. We believe that BX211 can be effective against antibiotic-resistant strains of Staph aureus, enabling the breakdown of biofilm, offering the potential to resolve infection, prevent clinical deterioration, improve wound healing and a DFO and DFI clinical resolution. All these are endpoints explored in the Phase II study, the design of which we review in the next slide. Next slide. A total of 41 patients were enrolled in the study in a randomized 2:1 ratio of control to treatment group. 26 patients received IV and topical administration of BX211 on week 1, followed by a topical weekly dose through week 13, while 15 patients received a placebo. All patients, treatment, and placebo were also treated in accordance with the standard of care, including antibiotic treatment as appropriate. The primary endpoint of the Phase II study was percent area reduction, or PAR, of the study ulcer through week 13. Study design was guided in part by experience [indiscernible] cases using phage therapy for the treatment of DFO and osteomyelitis. The results readout was scheduled at week 13. Next slide. Let's now talk about the results. First of all, we did not see any safety issues. While not surprising of phage's extensive safety record, it is reassuring. Patients treated with BX211 demonstrate sustained and statistically significant PAR of ulcer size with a separation from placebo starting at week 7 with a difference greater than 40% by week 10. In addition, statistical significance was demonstrated an improvement of both ulcer depth at week 13 and reduced worsening of ulcer area compared to placebo. Also, depth of bone involvement at baseline was compared to the deepest tissue involved as measured by swab at week 13. The study also captured additional clinical parameters, demonstrating favorable trends for BX211 treatment of DFO compared to placebo. Among these, it was observed that the proportion of visits with no clinical evidence of infection was higher in the BX211 treatment group. BX211 also displayed favorable trends in a resolution of DFO by MRI, X-ray at week 12, a 50% reduction from baseline in C-reactive protein and greater Wagner scale improvement. Finally, the study showed that through week 13, BX211 displayed comparable efficacy against both methicillin-susceptible and resistant strain as well as against high and low biofilm producers, consistent with the orthogonal mechanism of phage therapy to antibiotics and its inherent antibiofilm capabilities. Next slide. When talking to key opinion leaders in the field, our expectation for the trial that BX211 given on top of standardized treatment was capable of a 30% improvement over placebo. That would be impressive and given that the study only had 41 patients, we had no expectations of attaining statistical significance, but at least we hoped we could see a signal within the data. However, we are thrilled to see the strength of the data, demonstrating improvement in ulcer site that exceeded 40% compared to our expectation of 30% and displaying statistical significance at week 12. Next slide. Additionally, we saw statistical significance in other parameters, including the depth of these ulcers. When you look at these data, you can see quite clearly that patients treated with phage on the left had improved recovery compared to those on placebo, and this reached statistical significance at week 13. The dramatic impact compared to placebo can be seen here with 12 out of 13 improving in BX211 treatment group relative to the only 5 out of 9 in the placebo arm. Interestingly, this supports further the potential effectiveness of BX211 as the previous ulcer measurement, PAR, showed reduction on the surface of the ulcer. This measurement demonstrates improvement in the depth of the ulcer. Next slide. We also looked at additional clinical parameters to get an understanding of the totality of the data despite these not being powered to display statistical significance. Looking at MRI and X-rays, we saw that there was a tendency to see less of the infection at the bone. Tissue involvement and blood inflammatory markers suggested signs of resolution of infection, and Wagner scale improvement was evident in addition to no worsening in the ulcer area. There was also an increase in the proportion of [indiscernible], but no clinical evidence of infection worsening in the BX211 arm as well. Next slide. Overall, this is a very exciting time for phage, and we feel that the field has been expecting data like this for years. Finally, these Phase II results mark, to the company's knowledge, the first well-controlled, double-blinded, placebo-controlled clinical study to demonstrate statistically significant efficacy of phage therapy in a clinical endpoint for chronic bacterial infection. The strength of the study is reinforced by the ability of BX211 to demonstrate a clinical effect on top of the standard of care, including antibiotics, signifying the role that bacteriophage can play in the treatment of DFO patients. Many of them waited for over 2 decades for new drug approvals in DFI or DFO. BX211's consistent performance across severity levels, infection profiles, microbial resistant patterns positions it as a potential game-changer in the management of DFO and DFI. We hope BX211 will fill this unmet need as it progresses to the next stage of clinical trials. Thank you all for tuning in today. I'll now turn you over to Marina, who will discuss the company's financial results.

Thank you, Jonathan. This has been a strong start to the year for BiomX. In February, BiomX announced a series of financing rounds with total gross proceeds of approximately $12 million. Funds will support the completion of our Phase IIb study of BX004 in patients with cystic fibrosis or CF who have chronic pulmonary infections caused by Pseudomonas aeruginosa. We believe the funds attained will provide adequate runway to reach the readout of top-line Phase IIb results, which are expected in the first quarter of 2026. Additionally, a portion of the funds attained is being allocated towards the preparation for regulatory discussions on BX004, expected later this year. Ahead of these discussions, we're exploring and analyzing real-world evidence in people with CF to further understand the relationship between Pseudomonas aeruginosa reduction and clinical outcomes. We are grateful to Deerfield Management Company, the Cystic Fibrosis Foundation, Nantahala Capital, and our additional investors for their continued support throughout these recent financing rounds. For additional financing details, please refer to BiomX's 2024 fourth quarter and full year press release and 10-K issued on March 25. Prior to opening up for questions, I wanted to add a reminder that BiomX will host a virtual event on April 3 at 11:00 a.m. Eastern Time, featuring prominent key opinion leaders in the field of bacteriophage therapy and diabetic foot infections. Together, we'll dive deeper into the results from the Phase II trial of BX211 in DFO and explore the broader clinical and therapeutic implications of these findings. The insights shared by our expert panel will provide valuable context on how BX211 could shape the future of care for patients with DFO. KOLs joining us for this call will include Dr. Robert T. Chip Schooley, MD, Distinguished Professor of Medicine, Division of Infectious Diseases and Global Public Health and Co-Director, Center for Innovative Phage Applications and Therapeutics at the University of California, San Diego; and Dr. Benjamin A. Lipsky, MD, Professor of Medicine Emeritus at the University of Washington, Seattle. We encourage you all to join us for this important discussion. The link to register for the event can be found at the bottom of the DFO press release issued this morning. With that, we would be happy to open up for questions.

[Operator Instructions] Our first question today is coming from Joe Pantginis from H.C. Wainwright.

First, let me offer a two-pronged congratulations, and you alluded to this in your prepared comments, Jonathan, first for your clinical data here and then second as being a very important step forward for bacteriophage in general. So I guess before I ask some of the questions on the data here, I wanted to get a sense, especially in this current ongoing financing environment, of the potential for additional non-dilutive capital from various sources, including potentially the Navy moving forward.

Joe, yes, right, we've waited many, many years together for this moment. So we're obviously very excited, and thank you for the warm words. I do think it's a great question. And sort of interesting, the DHA has been supporting the company for a while with quite significant non-dilutive funding. And we're looking at geopolitics as a very troubling condition and one would wonder why the Navy and the DHA would look into diabetic foot ulcers and osteomyelitis. Interestingly, they've been looking basically at monitoring bowel wounds out of Ukraine, and quite a lot of the troops are coming back with drug-resistant infections. So I think some of the U.S. defense establishment sort of identified phage as a potential key modality invested in several companies in the field to try to think about what will be the next thing when U.S. soldiers are facing these threats and resistant infections. So that's been the rationale. I think we've been very fortunate to get their support. I think there's interest to continue that support. And that could provide, I think, a solid and very substantial non-dilutive funding.

That's helpful. And if I dive into the data a bit, again, two-pronged questions here. I wanted to get a sense of, first, the benchmarking with regard to the patients involved in the study here. And you did allude to this as part of the general population. But for this particular study and the demographics, first, what would you consider the natural course of disease for these patients? I mean, could you consider, as part of the answer, spontaneous healing of the patients? What percentage could that be? Anything else you wanted to add? That's first. And then the second is, what are your thoughts on how the control arm performed in this study, say, relative to the general population of DFO?

The 2, I think, very good questions. So I think the first one is regarding the patient population. So these are very, and again, we're fortunate to kind of run and get some feedback from some of the top KOLs that will listen to them in the KOL call. But this is a very typical patient population with DFO. Unfortunately, for our gender, it's the majority of males, median age of around 60. And that's kind of the way the patient population looks in these conditions. Again, a very dire need in which, in the case specifically of DFO, 40% of the patients with DFO will end up with an amputation. So you have slightly less than half of them kind of not improving, deteriorating and ending up in very unfortunate conditions. As we recall, the expectations for the study in the placebo arm is on a standard of care. Usually, one would see an average also shrink, the expectation was around 40%, and that's what we've seen. So you have a large chunk of these patients that are not responding to therapy and kind of deteriorating over time, hence the great unmet need. I think to your point about the second question about the placebo response, and especially if you look at the graph, and for those that haven't managed to follow the slides, I mean, the deck is available on our website. The corporate website is there, and we'll highlight it, so you can see it. So basically, you see, again, the data that we're extremely excited, you see the separation to 40%. So if you think about the expectations that we had coming into the study, placebo is kind of hovering around 40%, 35% as we've expected, right, treatment. We recall many of our conversations together, we guided to see like a 30% improvement over treatment. We're getting something closer to 40% with a stat sig at week 12 and a very strong signal at week 13. So obviously, very exciting. I do think one of the questions that we looked into and -- said it separates after week 6. So what's going on? Why is the separation not happening earlier? And as we talk to the clinicians and the KOL, because these patients have a lot of comorbidities and they're not usually kind of taking care of themselves properly, being enrolled in a clinical study does have its effect. Again, the placebo is getting standard of care, which is not only antibiotics but also debridement. So they're coming up. They come to the clinic every week. So they're probably benefiting from better care than their day-to-day care. So I think that's where we're seeing some placebo response as well in the first few weeks. But then after a while, they average out to what we know is expected in this patient population, around 40%. Interestingly, to the point, the phage group is still continuing to improve, which is one of the reasons we're so excited. They're continuing to improve over time. I think that could be driven by a few factors beyond what we talked about regarding the placebo. I think it's the fact that we're probably the phage or grinding biofilm, which is not an exponential process or more of a linear process, as you get more and more treatment and hopefully, you're clearing out more of the biofilm and enabling greater healing as well as over time, you might be exposing more of these bacteria and again improving all the healing and more phage meets bacteria because, again, these are patients with very poor blood supply, a ton of biofilms. So you might need to kind of dose over and over until you're getting enough phage to kind of start that chain reaction. So I hope that addresses both.

It certainly does. And then if you indulge me a little bit more, please, or I could jump back in the queue. But in this study, and I know maybe the data are obviously new and you're still analyzing things. But when you look at not only these data but even your prior cystic fibrosis studies, you're getting constant learnings with regard to the dosing regimen and the time of application. Do you have any early learnings here that might be applied forward?

Probably still early to tell. I think here in this study, we're seeing a more gradual response over time that opens up versus the CF, in which we saw some of the patients that had the complete eradication very quickly. I bet it depends on the route of delivery, which is one of the lessons that we've learned in the past. So I think we can translate. We feel comfortable that all our in vitro work does translate to activity. We're very fortunate to be in this position. I think the careful screening in this -- we literally took bone biopsy from every patient and made sure that we can grow the bacteria and characterize them and make sure that the phage is susceptible to it. So a lot of it was relevant across both studies and translated well. But I think route of delivery and probably the geography of the infection makes a big difference because in CF, they're probably more accessible in the lungs, and we saw a rapid response when it hit. Here, we're seeing that over time -- it's quite interesting that over time, what you're seeing is that the phage group just continues to improve. So we're grinding, maybe these biofilms, taking out whatever bacteria become available, and just over time, it gets better.

Got it. And my last question, and thank you again, is a bit forward-looking. You might not want to touch this yet, but anything with regard to a first swing at the Phase III potential sizes, looking to these -- the expectations here is of similar like 30% to 40% increases, size of the study? And would you be seeking any potential regulatory designations, such as breakthrough status?

So, to your point, it's a bit early. I think we're very excited and very pleasantly surprised by the quality of the data that gives us so much information moving forward. I can share, I think, some of the thinking because some of the endpoints that we're seeing here are on soft tissue. I think that one can look into moderate-to-severe diabetic foot infections as well as osteomyelitis. So I think that's some of our thinking. But really fine-tuning the next steps will require, obviously, regulatory consultation, talking with our partners at the DHA, strategizing what's the best path forward.

[Operator Instructions] Our next question is coming from Yale Jen from Laidlaw & Company.

This is a very great positive surprise. Congrats on that, Jonathan. So quick questions. The first one is that the p-value of 13 weeks is slightly above 0.05 versus 12 weeks is under. Is there any thought impact on that or simply just the small study size?

Yes. I think that is a great question. I think it's a very small study size. If you recall, the original guidance was that we weren't even expecting any stat sig anywhere because it's only 41 patients. I do think the strength of the data produced the kind of statistical significance that we're seeing. So yes, week 12 was 0.046. At week 13, we're barely scratching the almost stat sig. So extremely pleased with that data. I will highlight, I think, when you look at the totality of the data on top of what we saw in PAR, reaching that point and clarity. When you look at the next slide, for example, Slide 13. So that is what we do. We take a Q-tip, and we're trying to see how deep we can go into the tissue. We looked at those patients whose ulcer was so deep that we could literally get to the bone. And you could see these kinds of dramatic effects. So that's a clear statistically significant signal as well, with 12 out of 13 patients basically experiencing quite a significant improvement. So that's a very clear stat sig. Again, we did not expect stat sig in such a small number. I think that was so exciting. And talking to some of the KOLs, they said, look, we're looking for initial signals. Here, we're seeing something very definitive. I think the totality of the data looks very good. And I will highlight your point that there's another way of looking at ulcers at the PAR just to see whether ulcers are worsening. Because what you're really worried about and the issue in these patients is when an ulcer starts growing out of control and then the patient experiences amputation. So that's what's called an ulcer worsening. And I think in the fourth plot on Slide 14, you could see that even when we're measuring worsening in the ulcer area, that also reaches kind of stat sig as well on top of the tissue involvement, on top of what we've seen in PAR. So I think that's why we're so excited. Just the totality of the data, the measurements that are reaching stat sig, although we didn't expect in several of the others points, I think, a very favorable picture moving forward.

That's very helpful. Maybe I just continue in terms of the depth and area changes that you highlight here. You mentioned this is orthogonal differences between the phage treatment versus the antibiotics. Could you elaborate more on that? Because I think this is probably one of the factors that you see such a dramatic improvement changes.

Can you just repeat the question? You said difference with antibiotics? I'm not sure I followed the question, please.

Yes. I mean basically talking about the orthogonal differences between the antibiotics versus the phage treatment.

Yes. So, basically, if I understand the question correctly, both placebo as well as phage groups are being treated with the standard of care. There's the physician choice, they're all given antibiotics. Most of them they're getting debridement. So think about a placebo is getting debridement, which is quite an invasive procedure in which a surgeon cleans the wound, trying to facilitate recovery. And you see how bad it is that with all these interventions on a weekly basis with whether it's systemic or oral antibiotics, still the ulcers are not really improving that much in the majority of the cases. And I think that's why it's dramatic. The phage group got the same treatment, I mean, debridement plus antibiotics and on top of it, the phage. Again, the phages are orthogonal to the antibiotics, it doesn't interact. But there are a lot of data that sometimes is synergistic. We know it doesn't care about antibiotic resistance. And I think the amplification of the biofilm points are probably what's leading to this kind of continuous effect and continuous improvement that we're seeing in that arm.

The next question I have is that in terms of the chart, it's very impressive. You see the separation clearly from weeks 5 and 6. My question to you is that, is that historically similar in terms of the placebo, we'll start to see the effect become reduced and therefore, the curve going upward. So that will be something consistent with the real-world situation. Therefore, going forward, in your Phase III study, you will probably envision a similar sort of pattern to be seen.

So I think, to your question, there isn't a lot of data of being monitored on a weekly basis, the size of the ulcer. So there's a lot of times like after treatment and before treatment. On average, it is 40%. So I think where you see the placebo group hovering is actually what's expected on the meta-analysis. I think that's the guidance that we saw as well. So, it is a well-performing placebo group. I think, right, when you look at it, you're seeing some worsening. And then again, that could still be in a larger number, it might sort of flatten out. But to be with the placebo group around 40% is actually what's expected. So I will say, given the data that we have and after consultation with the KOLs, this is a well-performing and as expected placebo group. Hopefully, that's what we see in Phase III as well. So long as our, of course, placebo group performs the same as in this study as well, I think we'll be in a good spot.

Maybe last 2 quick questions. First of all, we know the phage treatment is very safe. So would you elaborate a little bit more in terms of specific -- was there any AE or anything that is worth mentioning?

Great question. We'll, of course, present all the data at an upcoming scientific conference. But in general, this is not a healthy population. So adverse events are expected. But we have not seen any difference between phage and placebo and any severe adverse events, which is treatment-related or anything like that. So I think it continues, again, with some of the observations we've seen in our CF study and other studies in the past, phage looks like a very safe modality, and hence, I think has great potential. It's a safe modality. We're seeing activity. It's selective, and it's orthogonal to antibiotics.

And the last question you actually just mentioned in terms of either publication or medical conferences was, was anything in mind at this point, particularly in the medical conferences?

So, yes, it's hot off the press. We're consulting with some of the KOLs. Again, we'll give guidance once we start putting together the abstract. But yes, I think we're excited. Again, as we said, I think this is a potentially pivotal moment for phage therapy. We're not aware of any data of this quality and showing clinical effect with statistical significance. So we're very eager to find the right context to publish and share more of the data.

Absolutely, a positive surprise, and congrats on your effort and the things come out great on the other side. So congrats.

Thank you, Yale. Thank you for the kind words.

We've reached the end of our question-and-answer session. I'd like to turn the floor back over for any further or closing comments.

I wanted to thank everyone for taking the time, and I hope you share our excitement with the data. We'll update you on upcoming events. And I'll just remind everyone of the KOL event happening on Thursday and have a good morning. Thank you.

Thank you. That concludes today's teleconference and webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.