Brainstorm Cell Therapeutics Inc. (BCLI) Earnings Call Transcript & Summary

Okay. Welcome back to our next session. This is Marc Goodman. I'm one of the biopharma analysts at SVB Leerink, and welcome to our conference this morning. If you're just getting started, we're lucky enough to have BrainStorm Cell Therapeutics as our next company, and we have Stacy Lindborg, who joined the company in June of last year, but industry veteran, ex-Lilly, ex-Biogen, and she is the Head of Global Clinical Research. And so she's going to go through a presentation, and then we'll have a little bit of time for Q&A at the end. So Stacy, thank you so much for joining us, and take it away.

Thank you, Marc. Thanks for the opportunity to present the NurOwn Phase III data on behalf of BrainStorm. I'm going to go through the topline data, which has been presented at MND in December and most recently the California ALS Research Institute. And we have so much more data that we would love to share. We're actively working on a manuscript, which we intend to submit for publication very soon. And through this manuscript, we'll bring transparency and a comprehensive summary of the trial results. Given the limited time I have today, I'll focus my presentation on a brief outline of the study design, efficacy outcomes across our prespecified subgroup and on important CSF biomarkers. Before I start, I thought it'd be important to provide some broader context about the NurOwn clinical development program. We have made a lot of progress in understanding the evidence generated by the study about NurOwn. And we've recently reviewed a high-level summary of evidence with FDA and also received feedback from them related to our Phase III clinical trial in ALS. The FDA's view from their initial review of our data is that the current level of clinical data does not provide the threshold of substantial evidence that FDA is seeking to support a Biologics License Application or BLA. The FDA has advised that this recommendation does not preclude BrainStorm from proceeding with a BLA submission, and we know that there is enormous unmet medical need in ALS and want to proceed very carefully as we make this decision. As we shared in our press release on Monday, we will continue to consult with our principal investigators who are very close to this trial and to the data. We will also seek input from internationally renowned ALS experts that are not connected to this trial as well as expert statisticians and regulatory advisers and ALS advocacy groups to really be able to assess the benefit and risks of a BLA submission before we make a final decision. And as a company, we've been able to demonstrate a consistent and meaningful effect of NurOwn, even though we failed our -- to meet our primary endpoint. And it's important to know that we're not alone in this view as demonstrated by statements made by highly regarded ALS physicians close to our data. Bob Brown, for example, expressed that there was evidence of benefit of NurOwn and a hope that we would have the opportunity to provide further assessment of this modality in ALS. Tony Windebank stated that there was a clear signal in this trial that some patients with ALS responded to treatment with NurOwn, and this is light at the end of the tunnel. But we know that, ultimately, an approval is up to the agency. So we're taking one step at a time, and the first will be to publish the data and allow further insights into ALS and in NurOwn. So my last comment before I begin really is just to offer sincere thanks to the ALS patients and their families that participated in this trial. Without their commitment and the efforts that they had to put into to be a part of this trial, we would not be in this position to advance our cell therapy, and we have learned so much because of their participation. So one of the components that I think is important for every trial is to really understand the centers and the principal investigators that not only help design the trial but also are central to the conduct of the study. This Phase III trial was run across 6 centers, which really encompasses world-renowned ALS physicians and preeminent research centers across the U.S. I've already mentioned Tony Windebank of the Mayo Clinic and Bob Brown from the University of Massachusetts Medical Center. But other physicians that are principal investigators that are key and associated with this study include Merit Cudkowicz from Massachusetts General and Harvard Medical School; Namita Goyal from University of California Irvine; Bob Miller from California Pacific Medical Center Research Institute; and lastly, Matthew Burford from Cedars-Sinai. These physicians collectively have a deep and a long-standing commitment to understanding and treating ALS, decades of experience with ALS trials across companies, making their objective input crucial to the study design and also to our trial interpretation. This slide gives you an overview into the study. It was a rigorous registration trial. You can see it was randomized, double-blind, placebo-controlled. It enrolled approximately 200 patients that were randomized 1:1, receiving -- each participant receiving 3 doses of either NurOwn or placebo, and these were administered 8 weeks apart. Patients were then followed for 28 weeks after the first treatment. And you can see 2 of the important exclusion criteria that's in the blue box on the slide. First, we excluded patients with the baseline score of less than 25 at screening. And we also excluded patients with a rate of decline on the ALSFRS-R, really the gold standard for an ALS disease progression if the rate of decline was less than 1 point per month, which is about the average rate of decline that's experienced in ALS patients. We did not seek additional confirmation of this inclusion criteria at baseline. This was intentional and by design, as we believe that once bone marrow was taken to produce each patient's autologous treatment that the patient should be included in the trial for ethical and compassionate reasons, which means that patients were considered included in the trial, no matter what their values were at baseline. The primary endpoint is a responder analysis, which I'll quickly illustrate on the next slide, and we had a number of secondary endpoints that were prespecified that included endpoints such as patients who experienced 100% improvement or their progression was halted or improved, 100% improvement. The average change from baseline in the ALSFRS-R, the combined analysis of function and survival and slow vital capacity. Let me illustrate the primary endpoint first. So as you can see here, the ALSFRS-R was collected. If you count the dots on the graph, there were 13 times that we collected this endpoint across the study. And you can see that we differentiated between the measures with the triangles that were before treatment and those that were after treatment. And what we can do is we can fit a line to these points to estimate the rate of disease progression so that we get a rate per month. So you can see with those patients, if you look at the pretreatment period, the slope is negative [ 1.08 ], which means that this patient was losing about 1 point per month on average. And then post treatment, if that -- if this patient had continued at the same rate of decline, they would have followed the dotted line, that trajectory. But you can see that they, in fact, had a very different trajectory post-treatment based on the circles and the line that's fit to it, the slope being 0.4 points per month, positive 0.4 points per month. And the endpoint, then over in the box on the right of the slide, you can see these 2 estimates of rates of decline. We take the post-treatment slope, we subtract off the pretreatment slope. And if the difference is greater than 1.25, they're considered a responder. And this is a really meaningful rate of the change in the disease progression for a patient to be considered a responder. As you can see from this slide, going through baseline characteristics, first, as you just look across the numbers, you can see that randomization was effective. We can see that the treatments are really quite balanced across all of these characteristics that are summarizing these individuals at baseline. The second thing you'll note, there are 2 interesting points. One, there's small imbalances with NurOwn, where we can see that patients are coming in about 1 point lower on the ALSFRS-R baseline compared to placebo, and there's a slightly more higher rate of disease progression pretreatment. But the second piece, if you're familiar with the literature and other late phase trials, if you look at the baseline mean for the total -- for the overall study, which is 30.9 -- I'm sorry, it's 31, you'll note that this average is far lower than many other trials. In fact, with ProACT, the baseline average is about 38. So we know we enrolled patients that were more severe in their ALS disease than in many other trials, late phase trials. The primary endpoint is based on week 28 and the response criteria that we just went through. You can see that there is a 33% response rate with NurOwn patients, which is compared to 28% with placebo, which is not statistically significant. The site allows you to actually get more of an insight into what was happening across the entire 28 weeks treatment period. And you can see that at each time point, the percent of responders on NurOwn is larger. The height of the bar is larger than placebo. Based on our Phase II data, we estimated that our baseline average score for the ALSFRS-R would be 35. So we prespecified a subgroup threshold to really coincide with what we thought would be the average baseline value. It turned out that this was really only about 30% above this threshold and 70% below, but it was prespecified and, therefore, that's what we're reporting. And you can see that above the greater than or equal to 35 patients that had less disease progression, there is an apparent treatment effect that's observed in these less severe patients, 35% of NurOwn response versus 16% on placebo. Given the sample size, it's not surprising this is not statistically significant. But again, looking at the height of the bars across the trial, you can see that this treatment effect is consistently demonstrated over time. In the baseline subgroup that is below 35, we observed comparable response rates between NurOwn and placebo, both at week 28 and over time with some time points slightly favoring placebo. We can see on this graph, which is really an important analysis that gives additional context as to what's happening with the patients across the trial, it's very common to look at change from baseline and look at the amount of disease progression and actually function that's preserved. So again, we're presenting the change from baseline across these 28 weeks looking at these 2 subgroups based on the threshold of 35. And we can see that at the end of -- with the subgroup that's above 35, there's a 2-point difference on the ALSFRS-R, which means that across these 28 weeks, NurOwn-treated patients progressed 2 points less, so they declined 2 points less compared to the placebo counterparts. And in the group with greater disease severity at baseline, so the scores less than 35, there's no difference between the treatment groups. So just a quick point to bring context to this rate of change and really preservation. We know that every point on ALSFRS-R means preserved physical function and sustained quality of life. There was a set of research that was conducted in Germany and published back in 2015, which tried to bring a quantification of what a point means in terms of quality of life, and they estimated that for each point reduction, this really matches about a 7% decline in quality of life for a patient. And you can see examples of this just so that it becomes more pragmatic perhaps to understand. So 1 point can mean the difference between turning over in bed without assistance, the difference between requiring a wheelchair versus walking with assistance, the ability to feed yourself independently or dress yourself. So all extremely important. I'm going to quickly go through some biomarker data. So this trial collected cerebrospinal fluid on 7 different occasions in all patients in the trial. So we have an incredibly rich set of data. We also included and collected serum data. And what we can see from this trial, we have demonstrated very consistent increases in neuroprotection, reduced markers of neuronal injury and reductions in neuro-inflammation. So in short, this trial has confirmed a multi-pathway mechanism of action for NurOwn and exciting changes in markers that are very important to ALS disease, which I will show you some data from today. One of the reasons I find this data so important is that it offers broader confidence in the assessment of NurOwn. So the scales that we use in clinical research are always well studied from a psychometric property, and they serve a very important purpose, no matter the disease. But we also know that clinical scales always have a subjective element to them. So biomarker data allows an objective measure, which is really an additional assessment that, when it aligns, can give additional confirmation of evidence. And as indicated by the colors on the scale, we can see the key markers of neuro-inflammation, neuronal injury and neuroprotection, all moved in the direction that were expected with an effective therapy. And while we're only including a small set of the biomarkers that we've studied, there are many other markers we will report out on when we publish this data, and it's a very rich data set and a very exciting data set. But let's first start with -- I'll share a couple of different markers across each of these categories so you can see what's happening over time. The first I'll start with is MCP-1, which is an important neuro-inflammatory marker. As you can see on this slide and across all of our data we have, NurOwn is in the blue color and red is in placebo (sic) [ placebo is in red ]. You can see a marked reduction in MCP-1 really occurring very quickly. So the first time point visit 7 is 2 weeks after treatment and then every other visit is 4 weeks apart. So you can see that early on, we wanted to see what kind of an effect we observed very quickly. We see a very pronounced effect. And then as we look to the end of the trial, we see a 75% reduction over placebo with NurOwn-treated patients and the consistency of placebo remaining unchanged. All of these time points actually are statistically significantly different, and you can see it's a very small p-value of 0.0001. MCP-1 is a really important marker. We know it's elevated in ALS brain, in spinal cord and in CSF. And it functions by recruiting inflammatory cells into the nervous system to cause damage. We know that this marker correlates -- from the literature, we've seen that it correlates with ALS disease progression and survival. So this is a very promising finding to see this kind of response. On this graph, you can see both neurofilament light and phosphorylated neurofilament heavy. Both are significantly reduced relative to placebo, and the effects are sustained over 20 weeks. In fact, the reductions with neurofilament light, which are very similar with neurofilament heavy, are about 82% of that of placebo at the end of the study. And these markers are -- neurofilaments are released by dying motor neurons and reflect a downstream terminal biological effect in ALS. And there's a lot of excitement around both of these markers across many diseases, including ALS. So the direction and the magnitude of change associated with NurOwn is clinically significant. It's robust and sustained. So very important. The last class of markers that I will talk about are related to neurotrophic factors. And we know that neuron is produced, the cells are produced to actually -- the cells are differentiated to increase the production of neurotrophic factors. VEGF is one example. We certainly have data and see very similar effects on other neurotrophic factors. But we know that VEGF is reduced in the spinal cord and CSF of ALS patients and that its microRNA is selectively destabilized and downregulated in fast progressing populations like genetic groups such as the SOD1 model. We know that VEGF may directly reduce motor neuron death by modifying cell death pathways. And we're able to confirm that our cells are delivering their cargo. And in addition, this is a very important part of our mechanism of action. So we observe a twofold increase from baseline following treatment with NurOwn, and again, a statistically significant increase compared to placebo, again, very soft p-value that you can see above. So the last slide, which I think is really important, just to bring perspective, we see exciting markers. We see evidence in a prespecified subgroup of a treatment effect. Are these in fact linked? Are they associated? This is still work that's in progress, but it's important, I think, to be able to share. We have looked not only at baseline markers, which will be more reflective of a prognostic marker, and also treatment effects that are observed not only with the changes in the biomarkers but also clinical endpoints post treatment. And we actually see a very robust strength of association of correlation when we look at the most predictive markers, and you can see that they're actually very similar -- the strength of association is very similar, both at baseline and post baseline. It's also interesting that it's not specific to the markers I have listed here. When we look at other markers that are part of these pathways, neuro-inflammation, neurodegeneration, neuromodulation, we actually see this level of correlation maintained. So they're not specific to a limited set of markers. So we see a strong relationship and a strong change in biological effects, and those are linked to the predictive nature of what we would expect in clinical response with these patients. That's what I have today to walk you through. Thank you.

Excellent. Thank you. Thank you. Interesting stuff. So I guess maybe you could just talk about the Phase II versus the Phase III a little bit. Compare what you did in Phase II versus Phase III and help us understand the differences and some of the results that were different.

Sure. Yes, happy to. So Phase II was -- we had 2 actually Phase II trials. So I'll talk more about the double-blind, controlled trial. One of the main differences between this trial and our Phase III is that we only had one dose in that trial, but we did learn in that trial that -- and in fact, the inclusion criteria for Phase III was driven from this trial and focused on patients that we would see progression that was more than 1 point per month. So that was part of the -- where the design element came from. When we look at the data and we look early on, and I think it's more appropriate to compare time points a couple -- 2 and 4 weeks after treatment since we don't have multiple treatments, we actually see a similar effect in these patients that were rapidly progressing, fast progressors. So on the ALSFRS-R, we actually see a difference in least squares means between placebo and treatment of 2 points favoring NurOwn in these patients. So we do see some consistency, and I think Phase II trials and bigger trials are always needed to get more confidence in the treatment effects. So that trial was much smaller and -- but very consistent findings.

Yes. And so you mentioned -- I mean, I guess, the question is what do you do now, right? What's the next step? And you mentioned at the very beginning, there was a -- in the press release that the FDA -- so you've gone to FDA, and the FDA said, this is not enough, we need something else. And basically, your decision is yet to be made. Like, do we file anyway? Or what's -- what are the options here?

Yes. So we think this is a really -- obviously, this is a very important decision that we need to make, and we don't want to make rashly. We are -- we've already had meetings with international experts, and we're at the very beginning of a set of very carefully chosen individual. So we can share our data very openly and get perspective. And we're seeking input. While the study was focused in the U.S., we're seeking input from experts across the globe. And so it will be very important for us to listen, to step back, to present very transparently like we did to the FDA, to share very openly. We've actually allowed our data to be -- we've given our data to an external statistician and allowed us to objectively hear what people are observing, people that know ALS, that understand clinical trials, that understand the challenges that come with real data. And so we feel that there's a very important period of time where we consider and listen, given -- especially given the unmet need and the outpouring that we're certainly seeing in the patient community and that we make a very wise decision. So we will continue to see what we can uncover and learn in this trial. But at the end of the day, we certainly understand that this is a regulatory decision, and the final decision ultimately comes from the FDA. So we'll continue to have strong...

This cutoff of the 35, so to speak, that was your number that you thought was a good cutoff from Phase II, right? That's learning from Phase II to go in the Phase III. This is not a -- we talked to a bunch of experts and this is the right number or the FDA believes 35 is a good cut-off. I'm just curious about that.

Yes. No, it's a great question. So subgroups are common. We often include them. Really just to give perspective on overall trial results, do you see something different in other patients in the trial? So they usually just give you a confidence level of your trial results. We tend to try to focus them around what we think will be the average. So we expected 35 to be the average baseline value. And really, that came from -- when we looked at the fast progressors that were enrolled in Phase II, we saw an average that was similar to this. So it was chosen because we wanted to see something that was representative of -- that you'd find about half of your patients above and below. We have explored other endpoints and have shared the results with FDA and certainly with our advisers. There are some very interesting things that emerge as you start looking at actually where the baseline value is in the trial and as you think about the impact of patients that are much more progressed in the disease. These will be included in our manuscript and certainly will become part of the dialogue that we have publicly as we're able to release them.

But your belief is that we should kind of talk to some other -- I mean, you went to 6 sites. So you're basically trying to talk to other people besides these 6 sites, I assume, right, other experts to find out whether this 35 is a good number and whether the signal that we saw is a good signal. And some of these other prespecified subgroups that you mentioned, we haven't seen that data yet, right? So that's also part of what you're saying is interesting and worthy of really evaluating. We just don't know it yet, right? We haven't seen that.

That's correct, Marc. We -- there's -- you always have to be careful when you think about -- we'd love to -- we want to be able to publish this trial in a prestigious journal. Journals don't want everything that will be in your paper to already be in the public domain. So we always have to be very careful and respect the process associated with reading out a trial. And also from an integrity standpoint, companies need to focus on what they prespecify. You start there. And then you share broader learning that you've gained from the trial. In terms of what we're seeking from these conversations with people that have been involved with trials all around the world that have known ALS for decades, you're looking for really an expertise as we really think about the totality of evidence that we can drive from this trial. It's not really just about the prespecified threshold of 35. That is a cut point that was identified. We thought it would be our average. You can look more logically actually at the baseline average of 31. You can also look at what do we believe? Do we see differences in patients as we see their disease progression? How is that impacting their outcome? And so really, it's around the totality of evidence and really getting input into what we believe we can conclude from this trial. And that's what we're seeking input on.

Thank you. Well, Stacy, thank you very much for joining us. Very interesting stuff. Obviously, I think the world is desperate for something for ALS. So we appreciate all the work you're doing and good luck with everything. Thank you. Thanks, again.

Thank you. Thank you very much.

Yes. Take care.