GT Biopharma, Inc. (GTBP) Earnings Call Transcript & Summary

Hi, everyone, and welcome. Thank you for joining us. I'm Michael Lipinski, our host. On behalf of Investor TV, welcome to today's interview with GT Biopharma. Now I am really, really excited about this interview. But before we get started, I just have to go over a couple of disclaimers. This webinar is being disseminated on behalf of GT Biopharma and may contain forward-looking statements. Investor TV is not a registered broker-dealer or investment adviser and to serving solely as the host of this event. We will also be taking questions directly from the audience. So please be sure to leave your questions down below. All right. That's it, let's get into it. The GT Biopharma is a clinical stage immuno-oncology company that is developing new cancer therapies through its proprietary TrikE platform. Now I know what you're thinking. This may sound like a mouthful, but to put it in really simple terms, GT Biopharma is working on ways to help the body's own immune system, better recognize and attack cancer cells. The company is already advancing programs across the blood cancers and solid tumors and trades on the NASDAQ under the ticker GTBP. Today, I'm joined by Executive Chairman and CEO, Michael Breen; and Dr. Jeffrey Miller, the company's Consulting Senior Medical Director. We're going to talk about the company's platform, where the programs stand today and the milestones investors should be watching for. Gentlemen, thank you for being here. It really is a pleasure to speak with you both.

Thank you, Michael. We're delighted to be here and very excited to present some information on our company.

I actually studied biology and neuroscience and graduate school. So I've been especially looking forward to this conversation. It's just one of those like full circle moments for me where I'm going to speak to you about a field that I first encountered in the classroom and which at the time, honestly, sounded like science fiction. So Dr. Miller, maybe to kick us off, you could bring us up the corporate presentation and just give us like a big picture overview of GT Biopharma, what you're building and what problems you're looking to solve.

Great. Give me once, I can hear it click the right buttons. Is that the correct screen?

It is right now. Exactly. Perfect.

Okay. Great. Okay. So thanks, everybody. I'm delighted to be here. Just a little bit of an introduction on myself, as mentioned, I'm a consultant for GT Biopharma I'm also a physician, and my job is really to take care of patients with cancer, which has been my motivation to focus my efforts on NK cell therapy for the past 30 years. And I'm going to take you through some of the journey about how we got there. So there's some just very big highlighting things that I wanted to start off with I think it's very clear that things have been changing in medical oncology. We started off with chemotherapy and radiation therapy. And I think what's going to drive the future of cancer therapy is something called the immunotherapy, ways to stimulate the immune system to be very specific for that cancer cell. I think all of us have friends, family, hopefully, not your cells at a head cancer. And I've gone through chemotherapy, which not only targets the tumor but also has many, many side effects normal tissues. And I think what we're trying to do overall in our platform that I'm going to cover today is just some very basic steps about how to specifically target the immune system to the cancer cell while not having any of the side effects that one might see with chemotherapy or radiation therapy. There are a number of engagers that have been out here. I'm not going to go through all of these -- this has been a big market driver in a lot of different fields. And I'll go through the specific sales I go through the discussion. So Michael, should I continue on? Or do you have further questions for me now?

No, I think you should continue on with the presentation, and I'll jump in at the end with some questions. Sounds great.

Okay. So I wanted to start off, one of our first forays into the clinic is a molecule called GTB-3550. And this is a molecule that was let's see. This was a molecule that was designed to target CD-33, which is present on AML cells in MDS, which is myelodysplastic syndrome. We treated a number of different patients, and this is really taking you into a better wind of where we are today. The therapy was given as a continuous infusion in 96-hour blocks for 3 weeks in a row, and this was followed by a weekend off after each block of therapy we went through 6 individual dose cohorts. There were 2 patients in each of these cohorts. And I wanted to take you through a very exciting summary of what we found in this early study that was completed a couple of years ago. So the first thing is, this is the number of activated NK cells circulating in one's blood. When the NK cell infusion was on, remember this is a 96 infusion. So day 3, day 10 and day 17 is the Wednesday while the infusion was going. You see all these cells at these peak areas get very highly activated and when you look on the Monday after the next infusion cycle, you see that this is followed by a period of rest. And this gives you the see-saw pattern that you see on this graph. The most important thing to me, as an NK cell biologist is what did we do with the NK cells circulating in the blood, and that's represented by this right panel. So you can see, again, when the infusion is on at day 3, day 10 and day 17, cells get activated, they get pushed out of the blood into tissue, which is where we want them to be. And then again, on day 8 after the first cycle of therapy after the second cycle here after the third cycle, you see this tremendous dose-dependent expansion of NK cells in the peripheral blood and here, we're trying to increase the immune cells that we think will be targeting to the cancers. So this has been very exciting to us. Again, this trial...

Let me jump in for one second there. And if you can go back for one slide. When you're saying NK, I just wanted to say this more for the audience that may not be familiar you're referring to natural killer cells, right?

Yes, that's correct. I use the abbreviation NKs, but these are natural killer cells. And let me take even a step back for that, Michael, for the audience. There are many types of white blood cells in the blood. NK cells are a subset of white blood cells that we think has the potential to attack cancer. Many of you have probably heard from about T cells or another type of lymphocyte that are in the blood. They can be targeted as well. And the audience is quite familiar with gene-modified chimeric antigen receptor or CAR T cells that have been FDA approved, and there's a number of products out there. Like T cells, we know that NK cells have sialic granules, they can recognize their targets. They make holes in the tumor targets. They put in cytolytic proteins that make the target so [indiscernible] and this is why we're excited about NK cells. It also reminds me since T cell products are out there, why do we think that NK sells are better I think the simplest answer is we think that they're going to have a better safety profile and be easy to -- easier to export. We're hoping that these will be safer molecules. They're not as activatable as T cells, but we think that they will have the same potential to kill tumor targets. So whenever I see NK cells, I'm talking about those natural occurring endogenous NK cells in the body.

All set. I appreciate the explanation. So

In that early clinical trial that we completed, we were very excited starting at doses of 25-microgram per kilogram per day of the continuously infused products. We saw 4 patients who had a decrease in the number of blasts that were present in their bone marrow and this was compared to a pre-bone marrow biopsy. Again, here is all the detail, which I'm not going to go through of the blast cell decreases that we saw in this trial. So this was excited for us, and I'm going to go through really our future-looking platform. We now have a second-generation camelid TRIC molecule this started in -- is in Phase I testing now. The first cohorts have been enrolled, and we continue to move forward. And I'm going to give you a little bit of a summary as to the rationale and why we got to the second generation camelid TrikE. We now have a B7-H3 targeted TrikE that is in the clinic now. It started earlier this year. The first patient was dosed in May of 2026, and we continue to dose patients in that trial. And again, this is the trial that I already just reviewed to you is kind of the proof-of-concept data as to why we're moving forward into some of these different platforms. So what is a TrikE? In very simple terms, you can see that these blue cells are NK cells in this gold colored cell is a tumor target. What I'd like to tell picturely, and this is a very high electron microscope view of an NK cell recognizing a target and I'd like to think that this handshake here emanating from the NK cell is what our trip protein does. It binds to the NK cell surface. It binds to the tumor allowing this NK cell to be pulled in to make a hall in these tumor targets and deliver all of its cytototic chemicals to ultimately lead to tumor kill. And I'll talk about some differences as I go through this between NK T cells in some of the competitor molecules that have been out there. So this is a picture of our protein. We call this Try because there are 3 functional domains. The orange domain here is an engager, which is now a VHH or camelid version. And I'll tell you in more simple terms and a subsequent side what that means. And this binds to the NK cell delivers a very potent activation signal to the NK cell at the same time, this linear protein, which I'm outlining here and is also shown here, brings an IL-15 molecule, an IL-15 is a cytokine molecule that also stimulates the NK cell. So one of the unique aspects of the TrikE molecule is that there are really 2 activating components in this linear sequence and again, something measuring what we call a tumor-associated antigen. For AML, this is CD33 and for the solid tumor targets is B7-H3. There are a number of different tumor targets. Many of these are classic single chain fees. Some of them are nanobodies, especially our B7-H3 is our first all nanobody or dual nanobody trig molecule. And this is really just giving all of the platforms that are being explored preclinically, the clinical programs right now are CD33 to B7-H3 in solid tumors and I'll talk a little bit for the CD19 about our plans to get into autoimmune disease. So let's first just see at a very basic way look at how these trike molecules work. And before this, I start this visual presentation. What you're looking at here is a very tiny fluid micro well. The green cells here are AML cells that are living and the blue cell is the single natural killer cell or NK cell and in the gray here is just the solution of this micro well containing our TrikE molecule. And what you see here is that the NK cells have the propensity to crawl around and to search around when a target gets killed, it turns red. And the process that's being demonstrated in this video, movie is a process called serial killing. If we put in a molecule here that did not have the IL-15 component in just a bike molecule recognizing NK cells in the tumor target we would not see serial killing. We might see on killing of the NK cell in its tumor target. So this is really bringing a unique aspect of each of the functional domains to mediate serial killing, which we think is equally important for antitumor activity when we give this to patients. So I already showed you early on that the first generation molecule gives us NK proliferation and activation in vivo. We know that we already saw a hint of some anti tumor activity in this earlier trial. There was no loss of the CD16 molecule in the NK cell surface. I didn't show it to you today, but we have all the translational data to back up that point. And really to our expectation, if you will, we saw very few side effects with this first-generation TrikE. We saw 1 grade 1 cytokine release fever cytokine release syndrome, which was a transient fever. This also occurred in the second patient at a higher dose in these patients were given a [ sitamenofhen ] or Tylenol, and this was totally self-limited in result [indiscernible] I already pointed out to you the data side about how we saw blast cell decreases. We know that this molecule has a very short half-life when you look in the soon, and we've done these pharmacokinetic studies. But remember, these have engaging molecules to bind to cell types in the body and we have some reason to believe because the effect of the drug is sustained at least for a couple of weeks. That, that binding of other components in the body is giving it a longer biologic half life than its serum half-life, which is listed here and certainly under 3 hours. So really, how did we make the pivot. Let me go into a little bit more detail. I'm trying not to be overly technical here, but human antibodies are shown in this cartoon here. In these human antibodies, these are the antibodies that protect us against infection in mononucleosis when we all got this in college. These are comprised of recognition domains in the lighter blues here containing a variable heavy and light chains. And what we know about Lamas or Sharks or many other species is they have different antibodies called camera antibodies. And these are defined by a recognition sequence called an antibody or a VHH or a single domain sequence. So what we did is we developed a proprietary anti-CD16 [indiscernible] sequence Again, this is figured in earner to bind to the NK-cell surface. And when we tested this in an animal model of leukemia, better tumor control is a lower dot on this curve. So there's a lot of tumor here when you give no treatment when we gave our single chain fee TrikE or the first-generation drug, we saw a moderate degree of activity. But when we gave the [ Camlin ] second-generation trade, we saw really far superior clinical activity, much better tumor kill and this was really the rationale to only move the second-generation platform using the anti-camelid CD16 sequence. And we can go through questions if you have them. So where are we in the competitive landscape? There are many companies that are talking about developing NK cell engagers Innate Pharma engages CD16 in the secondary receptor called [ NKp46 ] DragonFly recognizes CD16 and [ NKG2D. ] What sets us the site is very unique from these different platforms as we think IL-15, the co-stimulator brought into the immunologic synapse is far superior than any of these competing molecules, which at least preclinically, we've tested in the laboratory and again, the [indiscernible] was out there clinically was something that only recognize CD16A and this molecule is not really continuing clinically. We know that Innate Pharma has a molecule recognizing instead of CD33, CD123 in AML, and they've had a number of different reports showing at least preliminary clinical activity. I want to really emphasize here that what we have here is an immune engager to work on your own endogenous NK cells and our therapy is a protein therapy. It's not a cell therapy product. And this is really in contrast to feed therapeutics, which is giving induced pluripotent stem cell-derived NK cells in card, which has their own platform of an NK cell therapy where they're giving living cells. The engagers are protein therapy, including our trike platform, which comes in a bottle just like monoclonal antibodies and does not require the giving of live cells although that may be a combination that we want to test in the future. So I think the goal of the research is to get beyond acute myelogenous leukemia or myelodysplastic syndrome and this is where we became very excited about our protein called B7-H3. B7-H3 is in the family of immune checkpoint inhibitors why it's important here is it's widely expressed on a number of different solid tumors. And I'll tell you the eligibility of this trial in a few minutes. We also know that the higher the B7-H3 expressed on your primary tumor. This correlates with poor prognosis. So we thought it would be a perfect target to generate a track molecule. And this is really a cartoon rendering of that molecule. Again, we have a camelid component recognizing B7-H3 in the tumor in the purple here is the camelid anti-CD6 recognizing the NK cell in this Redish molecule here. This is the IL-15 costimulatory molecule to be brought to the immune synapse. So if you table -- if you label this trade sequence with a red dye, you could stay in cells and this is picking up this red dye. And if we look at a sarcoma tumor target that expresses B7-H3. You can see that there's a high degree of staining in this histogram here but if we take the exact same cell line, knock out the B7-H3 protein apply our TrikE molecule you get no stating here. And this is really important to us biologically because it shows the exquisite sensitivity of binding only to cells that have B7-H3 in not to cells that don't have B7-H3 such as your normal tissues. So in the next slide before I start this because it's really a remarkable summary of all our laboratory testing I'm showing you in red, and I'll get to that slide in a minute because the movie will start as soon as I click on it. The tumor cells are prostate cancer spheroids that are labeled in red and in all of these conditions, we're giving either NK cells, NK cells plus IL-15 or NK cells plus our trade molecule. And so this is the trite containing sequence. The Case is ongoing for about 4 or 5 days. As you could see with the NK cells alone, this is this black halo here. you see very little activity of the tumor target, Same thing with IL-15. But as you could see, the trike activate NK cells to totally dive into the steroid mass and to literate the red, which is the prostate cancer in this model. We have many other examples of head and neck cancer and other tumors that chose exactly the same thing. So really to complete up this portion and to move on, I wanted to tell you the flexibility of the platform. So as many of you know, there's been a lot of interest in B cell malignancies. If you look in the cell therapy market today, most of the cell therapy products are targeting B cells either in CD19 that's present on lymphoma cells and some leukemia cells in BCMA, which is present on B cells for multiple myeloma. So we have developed a molecule that we -- I'm sorry, it -- we have a CD19 targeted strike, which we've tested in cancer cells. And we have ongoing studies now because there's a lot of interest in the field in depleting the B cells that cause auto antibodies in autoimmune diseases, such as lupus and myositis. And the idea here is that if you target normal B cells making these pathologic antibodies you can get some control of the autoimmune disease. We initially designed this for B-cell malignancies such as chronic lymphocytic leukemia but we are doing the testing and exploring manufacturing possibilities to get the CD19 drug into the clinic. And remember, the trike is the protein therapy to engage NK cells to specific targets. It's not a cell therapy. And we think that this will be easier and more exportable. So Michael, do you want to make a comment on the last slide -- the last 2 slides here.

I actually -- sorry, go ahead, Michael. I just wanted to just to keep mind that I have a bunch of questions about these slides. But for me, personally, I'm going to wait till the end for all of my questions. Okay.

Okay. Thank you. So I just want to highlight the people involved in the company. You can see here, they're all lined up as it were. Alan Urban is our CFO, Chief Financial Officer. He has a public company background and he's very, very credentialed. Dr. Miller is, of course, a key opinion leader in the space with more than 20 years of research in this particular space, and he is with a shadow of a doc, 1 of the people who is leading the charge with this particular technology in terms of the natural killer cell engager technology. He's ably supported by Dr. Martin Felise who is an associate professor also out of the University of Minnesota, as Dr. Miller is. And then we have Chris Henry, who's our CMC and pharmaceutical science consultants and then our independent directors are Hilary Kramer, who is ex Lehman Brothers and Morgan Stanley; David Mongon, who's at Credit Suisse. And then Charles Casamento, who's ex Sanofi, and he was on the business development side. So we have an excellent team who are very, very experienced, and we're very lucky to have all of these people are involved in the company. And then it's just to highlight because I'm not a scientist, I come from a commercial background, and I'll explain a little bit about myself later. But just demonstrate that some of the high-value transactions that have completed in the NK cell engager space. You can see there the dating back as far as 2018. There was a license transaction with Sanofi and [indiscernible] where Sanofi paid at $96 million upfront with then potential milestones of a further $5 billion. Also, if you look more towards the right, the Dragon file transaction, it was a single molecule. And the most important thing of this is it was a preclinical license deal, and it was $300 million upfront undisclosed milestones and 20% royalties. So the reason I'm highlighting all of these transactions is just to demonstrate that if we get this right, and we obviously feel that we are on a very good path to do so, then commercially, it can be extremely rewarding for our investors.

Great. And I think that's [indiscernible] Michael.

Thank you, Jeff.

Gentlemen, that was a fantastic presentation. by the way very, very thorough. I'm going to get you to stop sharing the screen there, Dr. Miller. So they say sometimes a picture is worth 1,000 worth. That video is likely worth 10,000 words because I think sometimes it's just really hard to conceptualize these things, but seeing it work in real time, just really makes it very, very real. So that was really, really cool to see. Dr. Miller, I thought you explained everything extremely well. So this might be a challenging question for you because I would like you to try to do it in the most [indiscernible] terms as possible. So for someone that's brand new to GT Biopharma -- is this different from a traditional cancer treatment?

Yes, Michael, that's a great question. I think I highlighted a little bit. Remember, cancer therapy has been slowly improving over a number of years. But initially, before immunotherapy, which has really had most of its success over the past to 15 years. Prior to that, if you came in with cancer, you had really 2 opportunities. You got chemotherapy, which was typically given into a vein in the arm the chemotherapy would travel to all your systemic tissues, hopefully attack the cancer, but unfortunately give you side effects to normal tissues. I think many of you know with front-end family or yourselves the side effects are taking rapidly dividing cells in the body, hair follicles, that's why your hair fall cell. It's a side effect of the therapy the GI tract, you get many GI side effects of cancer chemo therapeutics. Some more subtle things as we know that certain chemotherapies attack heart cells and give you less good heart function over time. The same thing is true for radiation, at least where the radiation beam goes. I think the excitement about immunotherapy. And again, it's true for the NK cell engagers that we've talked about today as well as some of the TCAR therapies that have already been FDA approved as proof of concept. These are very specific therapies. The intent is to have very little side effects of normal tissue. If this works as model therapy as we're intending it to do, this will not give you side effects. It will not give you a hair loss or GI symptoms. The one thing we know about immunologic agents, though, is it gives you different side effects. Part of them are these transient flu-like symptoms. We know if you've got a viral infection you get fever, your muscle aches. We think that, that may happen with immune activation in these immunotherapies and the TrikE therapy. But we think those symptoms will be very self-limited and controlled and only last while the cells while the therapy is in the body.

Sounds like that's not really much of a comparison relative to the side effects of chemotherapy, right? people will take that any day over the other. Sticking towards the science and a little bit. GTB3650, I hope I said that right. is being studied to people with acute myeloid leukemia and high-risk myelodysplastic syndrome whose disease has essentially returned or who have basically stopped responding to treatment. What would you say is the biggest unmet need for those patients today?

Yes. I think, Michael, the unmet need is the end stage they are of their disease. By the way, I'm a bone marrow transplanter by trade. This is how I got interested in leukemia. And remember, if you're young and your leukemia response right away, you get into remission and you go on to a bone marrow transplant, which still has a real chance of delivering cure. This is true in any drug development. So when we started with GTB having discussions with the FDA, even with our first-generation trial, we were very clear to them, and they were very clear back to us when you're testing a Phase 1 agent that doesn't have any clinical data known, you have to start off with the worst patient. And basically, the patient eligibility in this cohort is the keeping relapse refractory failing standard therapy and having no other treatment options. And I know it's hard for people to grasp, but that is the way the drug development starts once you show activity of molecules, you're allowed to work, move it further up and sometimes these Neurotherapies can become primary therapy. But we always start with the worst patients.

So just on that note then, because it's an early Phase I study, you're basically still trying to do permit its safety. So as you're increasing dose levels, what have you basically learned about how patients are tolerating that?

Yes. Just like the first trial with the first-generation TrikE, I think we're starting to see some very light fevers that are controlled with the [indiscernible] just like we saw before. The thing that we have to learn now is we go up with the new molecules are we going to see the clinical activity that we hope to see. We're starting to get into the range that based on the laboratory data and our earlier study, we hope to see clinical activity. But the FDA is always because the second-generation TrikE is a different substance than the first-generation TrikE. We're kind of going back through that stage and we're hoping to see something. We do bone marrow biopsies before and after...

About to ask what would be the earliest -- so what would be the earliest indicators like -- what would you be looking for essentially that would say, okay, this is actually working.

Yes. I think the first thing would be a post-treatment bone marrow biopsy showing a decrease in blast. I'm a hematologist. That's not good enough. We have to show that those blasts stay away for a period of time, and we would have follow-up studies to follow that endpoint before. This is very different from what we're doing in the second-generation TrikE compared to what we did previously. The FDA in the previous study, let us do 1 cycle of therapy. Now we're doing at least 2 [indiscernible] therapy with the opportunity to get up to 4 cycles to hope to get a greater duration of the response if we see it. So that is built into the trial, and that's what we're going to be learning, I hope, over the next 6 months or so.

Fascinating. If we can switch gears for 1 second and talk a little bit about solid tumors. Again, right, GTB 550, that targets B7-H3, right, which is a protein from if I remember correctly, is found on many cancer cells. So why is B7-H3 an interesting target? And what could -- what could success in solid tumors mean for GT Biopharma?