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

Greetings, and welcome to the BrainStorm Cell Therapeutics Conference Call to discuss the SPA for NurOwn. [Operator Instructions] As a reminder, this call is being recorded. I would now like to introduce your host for today's call, Michael Wood of LifeSci Advisors, Mr. Wood, you may begin.

Thank you, Ed. Good morning, and thank you, everyone, for joining us. Earlier today, Brainstorm issued a press release providing details on the FDA agreement for NurOwn, also known as debamestrocel. Before passing it off to the company for its prepared remarks this morning, I'd like to remind you that this conference call will contain numerous statements, descriptions, forecasts and projections regarding BrainStorm Cell Therapeutics, and its potential future business operations and performance, statements regarding the market potential for the treatment of neurodegenerative disorders, such as ALS, the sufficiency of the company's existing capital resources for continuing operations in 2024 and beyond, the safety and clinical effectiveness of the NurOwn technology platform, clinical trials of NurOwn and related clinical development programs, the company's ability to develop strategic collaborations and partnerships to support its business planning efforts. Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond BrainStorm's control, including the risks and uncertainties described from time to time in the company's SEC filings. The company's results may differ materially from those projected on today's call, and the company undertakes no obligation to publicly update any forward-looking statements. Joining us on the call this morning will be Chaim Lebovits, President and CEO of Brainstorm; Dr. Stacy Lindborg, Co-Chief Executive Officer; and Dr. Bob Dagher, Chief Development Officer. I'd now like to turn the call over to Mr. Lebovits. Chaim, please go ahead.

Thank you, Michael, and thanks to all who have joined us this morning. I'm excited to share some very positive news about our planned Phase IIIb clinical trial for NurOwn for ALS, also known by the generic product name of debamestrocel. The FDA has given a positive Special Protocol Assessment for this trial and formally agreed that the design and planned analysis adequately address the objectives necessary to support regulatory submission. This significant milestone not only moves us closer to initiating the trial, but also ensures our approach aligns with the FDA's current views, standards and guidelines. This thought process outlines the trial's objectives, design, endpoints, statistical analysis and other supportive clinical trial documents. Assuming the trial is successful, it ensures that the data will be accepted by the FDA as a central part of a new Biologics License Application, BLA. This SPA agreement serves as a critical step to derisk the regulatory review of debamestrocel. Through this process, the FDA Office of therapeutic Products within CBER offers their assistance and guidance enable an efficient review process. The Type A face-to-face meeting was held on December 6, 2023, and within just 4 months, we have secured the agency's agreement on the SPA. FDA's approach has been instrumental in refining our trial design, while ensuring that the process moved quickly to address the urgent needs of ALS patients. To the best of our knowledge, this is the first ALS SPA agreement granted by the FDA, making this an even more exciting achievement. In parallel with the regulatory process, we've also been diligently working on other crucial aspects of the trial. We will be announcing [Audio Gap] Contract Research Organization, CRO, very soon. Additionally, we've been actively reaching out to new potential study sites and investigators. This upcoming trial will have more participating sites than the previous trial with those inflated to begin in 2024. I want to reiterate our deep gratitude to the ALS community. Your ongoing support, insights and experiences have been instrumental in guiding our reference. The BrainStorm team is committed to working closely with patients, families and advocacy groups as we embark on this next step of the development of debamestrocel. I'll now turn the call over to my colleague, Stacy, for additional comments.

Thank you, Chaim. We are excited to move forward with this trial, which was built on the learnings from previous studies to generate the necessary data for market approval. With a greater understanding of how NurOwn works and insight into which patients are more likely to benefit incorporated into the design of this trial, we can maximize the prospects of a successful outcome. We've been working with leading neurologists, scientists, statisticians and members of the ALS community, which has led us to the creation of a robust study designed, which is designed to demonstrate the effectiveness and safety of debamestrocel. The primary endpoint will be based on the revised ALS functional rating scale, which remains the gold standard for efficacy studies in ALS. The trial will enroll people living with ALS who are earlier in the course of their disease. And importantly, all participants in the trial will also be able to receive standard of care treatment. I'm delighted to turn the call over to Dr. Bob Dagher, our Chief Development Officer, who will walk us through additional details on the study design. Bob?

Thank you, Stacy. Good morning, everyone. I'm thrilled to have the opportunity today to delve into the specifics of our upcoming Phase IIIb trial for the BCT-006, which is a critical step forward in our journey performed of ALS, with our pioneering treatment, debamestrocel. This is a large 2-part, multicenter study that has been meticulously designed to evaluate both the efficacy and safety of debamestrocel in ALS patients. The entry criteria will offer the opportunity to enroll those participants who are expected to benefit the most from the cell therapy, like debamestrocel, as Stacy mentioned, while earlier in the stage of disease with onset of symptoms, like limb weakness, within the last 24 months. Additionally, participants must meet specific criteria, including each item on the ALSFRS score, scoring 2 points or higher and having preserved respiratory function with an upright slow vital capacity that's achieved 65% of the predicted value. As Stacy explained, patients in this trial will be allowed to receive concomitant treatment with an approved standard of care. Now diving into the specifics. As I said, the study has 2 parts. Part A of the trial will be a double-blind, placebo-controlled segment, spanning 24 weeks. We are aiming to enroll up to 200 patients, randomized in a 1:1 ratio to 1 of the 2 treatment groups, debamestrocel or placebo. The preparatory phase will include 6 to 9 weeks screening period, during which eligible participants will undergo a single bone marrow aspiration. Now this procedure allows us to procure the mesenchymal stem cells, or MSC that are necessary to manufacture each participant's individualized debamestrocel treatment for the duration of the trial. Following this, participants will receive 3 repeated intrathecal injections of either debamestrocel or placebo once every 8 weeks. All participants who complete with double-blind Part-A are given the option to enter Part-B, which is an open-label extension period, also lasting 24 weeks. In this stage, all participants will receive debamestrocel through 3 further intrathecal injection, maintaining the 8-week interval. The primary endpoint of the trial is the change in the ALSFRS total score from baseline to week 24. The statistical analysis will employ a Combined Assessment of Function and Survival, otherwise known as CAFS, C-A-F-S, which formally adjust for any mortality observed during the trial. In addition to assessing a host of clinical outcomes, we are also collecting cerebrospinal fluid, or CSF, and blood samples for detailed analysis of biomarkers related to neuroinflammation, neurodegeneration and neuroprotection, providing us with a wealth of data to further understand debamestrocel's mechanism of action and biological effect. Lastly, as the safety of our participants is paramount in everything we do, we also have an independent Data Monitoring Committee that is put in place to vigilantly monitor the trial safety and to provide advice. Now with this robust trial design that secured the SPA agreement with FDA, right, we feel that we are on the cusp of a significant breakthrough, and we're fully ready to execute on this trial and still support [indiscernible] forward to deliver a novel cell therapy for ALS. I will now turn the call back to Mr. Chaim Lebovits. Chaim?

Thank you very much. Operator, do you want to open for questions?

[Operator Instructions] The first question is from [ Ken Hackel ].

I was very excited to hear about this, this morning. I'm a long-term shareholder and investor and someone that cares a lot about the cell therapy and treatment change you guys are producing. My question really was around timeframe, financing and listing on the stock exchange. If I heard the numbers correctly, numbers turn out in terms of time frame of 24 weeks, 39 weeks, 24 weeks and 24 weeks. You add all up, that's a lot of weeks. And I'm curious how that gets financed, and what the risks are of the stock being delisted given it's currently trading around $0.70? So I'm really looking at a 2-year process between now and getting to that point of potential approval. And what are we doing in terms of financing to keep this thing going and the likelihood of the company remaining listed or not listed?

Thank you. Stacy, you want to take the first part of the question, and I'll do the rest.

Yes, Ken, thank you for the question. So you listened very carefully and were very accurate. So this is a trial that really is important to answer the questions I can. It's about a year long, which gives access to the knowledge of safety. It establishes and does have a double-blind period of 24 weeks in nature, which will enable insight into the efficacy and allows a gaining into the open-label extension. But this is really the trial that is going to be expected to demonstrate the benefit-risk of NurOwn.

Thank you very much, Stacy. And yes, we're well aware, of course, on the NASDAQ compliance, and we hope to be compliant by the end of the month. We have different plans how to stay compliant with NASDAQ, and we hope to manage that in a way that will be satisfactory that we are still listed. Re the financing for the trial, we're looking to get as many options with the bankers and possible partnership options, and we will report when we have more to report. We are working very hard on all fronts, including also the CRO and the site and the financing of the trial. Thank you very much for your question.

The next question is from David Bautz.

Thanks for the update this morning and congrats on the progress. So my first question is, why do you not have a minimum total ALSFRS score as part of your entry criteria?

Stacy, you want to take that?

Yes, I'm happy to. David, so we thought, obviously, long and hard and worked with the leading researchers in ALS as we were designing this trial, it's critical that we're enrolling the right participants. And of course, from our previous trial, we learned that we need to be focusing on participants that are earlier in the disease course, and that we're confident that all the measures that we're including will really enable for sensitive measurements and the ability to show efficacy. There are lots of ways to, of course, arrive at enrolling these participants. We did careful work, including simulations from databases, our own trials, and really it's the totality of the inclusion criteria that when we look at selection gives us the confidence that we're going to have the patients that we want. So that's how we've approached it, and really appreciate the question.

Okay. And so the primary endpoint for this study obviously is different from the first Phase III study. So I'm curious if the company proposed having the ALSFRS score as a primary endpoint or is that something the FDA was insisting on?

Yes, it was mutual. The FDA was very -- yes, the FDA did also propose the ALSFRS as the primary endpoint.

Okay. And how is the study powered? Is it 80%, 90% powered? Or are you willing to disclose that?

Dr. Lindborg is the expert in this. Stacy?

Yes. David, we're -- with everything that we've done to research and prepare for this trial, we know that we have above 85% power. So it is very adequately powered for the goal.

The next question is from Jason McCarthy.

Can we talk a little bit about the open-label extension portion of the study and how that average ALSFRS score may change or improve? Keeping it unblinded, would you provide updates along the way? I know it's kind of like reading [ TVs ], but you're going to be able to get react to doses into those patients that opt for the OLE, and it might be a little bit of a read through to the outcome of the trial.

Thank you, Jason. Stacy?

So the trial is set up, as you'll be very aware and Jason, you're experienced -- the Phase III trial, the primary endpoint is at week 24. So there will be a formal database lock at that time, and there will be [indiscernible] that are looking at the primary and the secondary endpoints associated with the trial. The open-label extension as we were designing the study, we believe that it was a critical part of the trial. When you look at the more extended dosing, we expect in a disease like ALS that there will have to be ongoing dosing and treatment. So to bring perspective and clarity, confidence from a safety standpoint, of course, we'll continue to look at efficacy as well as biomarker data. So this open-label extension is important to not only continue to treat patients, to treat participants, who happen to be enrolled and randomized to placebo that all patients will be treated in the trial and to allow ongoing learning. But the real conclusion from a provability standpoint, the [ primary ] endpoint is that [ we turn for ].

Got it. Is there going to be some type of potency assay with the individual treatment in terms of the levels of the different growth factors that the cells could [ secrete ]. I remember it came up in the prior ADCOM, and there were differing views on what those levels in the intrathecal space should be or could be with the cell therapy.

Stacy?

So we are absolutely working through these questions and having a separate dialogue with FDA around levels of biomarkers and specifically potency assay. And I'd say that's probably appropriate for a later update call, but we're making great progress. And that will be -- they're clearly outlined in advance starting the trial.

Got it. Last question, just generally, are the same centers in the U.S. going to be participating in this trial? Or are you going to be expanding to additional centers?

Stacy?

We had some phenomenal centers in the trial that we expect to be a core part of our centers, that we're really intending, as I mentioned at the beginning of the call, to expand the number of sites that we're able to really speed up the enrollment. We want to keep the trial as tight as we can from a timeline perspective. And we're also thinking about the geographical focus of the sites. So you'll find that we will certainly have very key centers that were involved before. We have a lot of support from leading researchers that are continuing, but we're going to really be looking strategically how we expand that.

Got it. Congrats on getting the SPA, very exciting.

The next question is from Daniel Walker.

Could you maybe talk just a little bit briefly about manufacturing, how you anticipate manufacturing the drug for this upcoming Phase IIIb SPA? Will it be similar? I mean, will you be looking at Dana-Farber, City of Hope, Catalent. Can you just talk a little bit about that?

Thank you very much, Daniel. So we will be announcing, just like we've been announcing any CRO, we'll be announcing very soon, who is our manufacturing for the Phase IIIb trial. So look forward to that in the next few weeks.

Great. And maybe just 1 last follow-up around funding. Do you have funding lined up already? Or do you anticipate doing that over the next few weeks? You anticipate a formal announcement at that time? Can you comment anything more on that?

Yes. I commented for the first question. It was the same question. Of course, we are looking at different options of the funding. And as you can imagine, there are different opportunities. And we're going to look at what's the best funding method for the company. It may be a follow-on at a later stage, it may be a partnership, or it may be different options. And we are working on that simultaneously with lining up, as I said, the CRO, the manufacturing center and initiating the sites. We're doing that also [indiscernible]. Operator, I think we can end the call for now. And I just want to again thank everyone for being with us today. This is a very exciting moment for the company. We were hoping to get the SPA in an expedited way and 4 months from our Type A meeting and very exciting that we got this. We have a lot of work on our hands, and we hope to update you soon with additional positive updates on how the trial is going to go forward and the different aspects we just discussed on the call. So thank you very much for being with us today.

Thank you. This concludes the BrainStorm Cell Therapeutics conference call. Thank you for your participation. You may go ahead and disconnect.