Lantern Pharma Inc. (LTRN) Earnings Call Transcript & Summary

[Audio Gap] CEO presentation titled, Leveraging Artificial Intelligence to Develop Therapies for Brain and Childhood Cancers. Again, I'm managing member of Tribe Public. Our website is tribepublic.com. Also, please note that I'm also the Managing Director of Vista Partners, LLC, a registered investment adviser in California, and its website is vistapglobal.com. Please kindly review both sets of disclaimers at both sites and know that I'm currently a shareholder of today's presenting company, Lantern Pharma, NASDAQ symbol LTRN, an exciting AI company in the world of medicine. As many of you know that are currently members and those that have just joined, welcome to the Tribe, as we say. And we have members from over 30 countries that come into our webinars. And we have a number of cities, 34 Tribe Event sites across the U.S. where we have experts like today's presenter, Panna Sharma, the CEO of Lantern Pharma, present at either Tribe CEO Luncheon events, dinner events and Speak engagements on a regular basis. And know that we have what we call the wish list process. The wish list process is where you, as a member, again, everything is free here at the website at tribepublic.com, you submit the names of experts that you want to hear. And if we get enough interest in your area, we'll do our best to schedule and organize an event in your area. And if we cannot, we'll also try to get them on a webinar like today. And so you can learn from that and know that today, you can also -- being that it is a Q&A session at the end of this, if you haven't sent in your questions, please send it through the Zoom Chat feature now that we're live and let us know what questions you might have as we go along the presentation. Again, today's co-host is Panna Sharma. He's the Chief Executive Officer, CEO of Lantern Pharma, again NASDAQ LTRN, and it is an artificial intelligence company developing targeted and transformed cancer therapies using its proprietary AI and machine learning platform called RADR. And with multiple clinical studies, clinical drug called the stage drug programs in the works. Again, thank you also to Lantern for joining us today and Panna Sharma. Look forward to hearing from you and getting this great update, as you've had several announcements with exciting progress announced here and look forward to you to help us better understand Lantern and also how AI is really transforming the world of medicine. Since some other folks across the world here that are plugged in today have not met you, Panna, can you do us a favor and just give us a quick background on who you are and what led you to being the CEO of Lantern Pharma and then pull up your presentation after that?

Sure. Thanks, John. Yes. So I joined Lantern about 6 years ago, actually, as a CEO. And at the time, we really didn't have any drugs in the clinic. We had one drug that was in development or very early stage preclinical. Today, we have about a dozen programs. So a lot of progress. And that progress has definitely been driven through AI and the cost for us to bring a new concept, whether it be a new molecule, a molecule optimized based on some ideas we have about existing mechanisms or to rescue a drug is in between kind of 1 and 2 years, maybe 2.5 at a cost that's a few million dollars. And that's an unheard of number in oncology. And very recently, this year, as we've developed all of our programs, they're finally getting to the point where they're getting a lot of excitement. Excitement, especially in terms of milestones. We received now 4 pediatric disease designations for one of our drugs, LP-184, I mean I think that's more pediatric drug designation -- disease designations and virtually any other drug that I know about in cancer. And what that means is if we get the drug approved in any of those indications for pediatric or childhood cancers, including an ultrarare brain cancer called ATRT and 3 other cancers, rhabdomyosarcoma, MRT and also hepatoblastoma. If we get an approval, we can sell the voucher associated with getting rare pediatric disease designation. And those typically sell for between $100 million and $120 million. So that's fairly unique to get one. I mean that means you really are able to pinpoint that there's going to be some potential efficacy because you do have to submit to the FDA some evidence that there's going to be benefit specific to that population and specific to the mechanism. We also most recently got Fast Track designation in GBM. And that also is, I think, very positive. And fast track really is given by the FDA, if it determines a disease is serious enough and that your drugs actually impact survival or stop progression. And they do in a variety of areas, epilepsies, depressions, even certain viral conditions, but definitely, in certain cancers, and we got it in GBM. And the wonderful thing is that GBM program wasn't even really at the stage of development when I joined the company 6 years ago. And 4 years ago, we had some good ideas. And 3 years ago, we've got some really compelling evidence about our drug's ability to cross the blood brain barrier and then when you use data to find not just one more indication but 5 or 6 additional indications quite quickly. So we're quite excited by that. And if it weren't for AI, those indications both in rare children's cancers and also in many of these brain cancers, they may have been, a, undiscovered, take much longer to find, and we certainly would not have had the preponderance of evidence. And so that AI has tremendously compressed the time line involved in discovering and developing those indications and getting regulatory kind of milestones associated with fast track or rare pediatric designation or orphan, and we have all of those. So we're pretty excited. I mean doing data-driven drug development really is the future. But you have to have a data engine and you have to have a lot of data, and you have to have the right algorithms and you've got to have a good team that understands how to develop those indications quickly. And that's what we've been able to do. And when you take that approach, you can really model and milk almost everything out of that molecule, and that's what we're able to do today. And I think that's a fairly unique approach. But I think it's an approach that most of drug developers will take going forward. I'm going to move over to one of the drugs, 184 as I mentioned. And we found a lot of different indications, but the ones that are very exciting to me are really the ones in brain cancer and also in many of the pediatric cancers. We've got a lot of patents around this drug. And we think it's a very unique drug because it not only is super potent by itself, but it also is able to be combined with other drugs. And again, those combinations and combination studies, we always find in silico first, meaning in the computer, and then we validate them in the lab. This is a drug that's actually in trials today. We've enrolled about 40 patients in an umbrella basket trial. And in many of the indications that we're talking about, we intend to start to indications in pediatric cancers once we establish what's called a maximum tolerated dose in adults and then you can start going into kids. And the very unique thing about this drug, and this is why we believe it has a really compelling place in both brain cancer and pediatric cancer, is that both of those kinds of cancers, if you have the wrong molecule, you can do a lot of damage. The brain is a particularly challenging place to get a drug to. And if the drug doesn't behave the way you would like it to behave or the way you suspect it to behave, that can cause the wrong consequences. Same with kids. Kids are very unique, very, very different. Pediatric versus adult cancers. They're still developing their organs, a lot of their vital systems and especially their brain -- are much more sensitive to outside agents, outside molecules and the kind of repair may be not correctable. I mean you can lose hearing, you can lose functions. And so you have to be really thoughtful about, is the mechanism that you're going to try to exploit, is it going to be properly expressed in both adult and pediatric or brain cancers? And does it work the way you think it's going to work? So let me point out a couple of very unique things about this drug and why we are very particularly excited about it. The drug really lights up, number one, when there's an active certain amount of PTGR1, a very specific enzyme. And that's not available, the drug doesn't become active. And that's a really very important enzyme and that was discovered through AI because the drug works in certain cancers, but not others. But when PTGR1 is present, it creates LP-184 into a super potent metabolite that has an open cyclopropyl ring, and that's what actually attaches itself to cause double-stranded breaks in the cancer cell DNA. And so again, that can take years of discovery, but we did this quite rapidly in silico, where we saw that there's always a straight line activity. The more PTGR1 as you can see on this chart, the more active the drug was, the more response we got. In fact, when there was no PTGR1, there is no activity. So this gives us a really, really exciting correlation coefficient. This is measured as log2 across a number of different cell lines. And so when we discovered that PTGR1 was almost perfectly correlated with activity, we then decided to take a look at what are the systems around these cancer cells that allow us to get to a high level of PTGR1. And we uncovered a lot of very, very specific mechanisms like what's all associated with DNA damage repair. And this is really a big data exercise. And we -- this led us to a very unique publication done about 2 years ago today, where we actually talked about our very first pediatric brain cancer called ATRT. We published that with the National Cancer Institute. And we're quite excited by that because that really opened up the door not only to these pediatric disease vouchers, but it also opened the door to making a huge difference in understanding why can we exploit this unique mechanism in childhood cancers. And so this is, again, exercises that without the kind of data that we have, it's very, very difficult to uncover. And almost -- that's one of the reasons that with only a handful of drugs, we've been able to make a huge difference as an industry in childhood leukemias and lymphomas, but many other childhood cancers like brain cancer, which is responsible for almost 30% of children's deaths in -- with cancer, we really haven't been able to make much difference. And as we validated this marker, we then use CRISPR to validate it even further, and then we went into mice to show that even works. So going from in silico to in vitro to in vivo, we continue to see the right kinds of things. And that's very important because that then gives you the confidence that you can go clearly to humans, which we're now beginning to. And again, the reason why we think data is very important is because today, almost across the board, almost every channel that is diagnosed with cancer when they go in for treatment, they do get large-scale genomic sequencing. And we're now in an era where you can take all the data from these pediatric cases and start looking at what are the genes or biomarkers that are present, not present, involved, potentially not involved. And so I think in the future, as we go further into pediatric cancers, you're going to have, I think, a lot of, I would say, kind of almost a mini renaissance of drugs. And so once that happens, I think we're going to start seeing a lot of great treatment across these both pediatric cancers, but also in more and more subtypes of brain cancer. I'm going to take a quick pause there, if you don't mind. So let's talk a little bit about the GBM. This is where we got fast track. Again, we know that our drug crosses the blood-brain barrier in a very favorable way. And again, this was initially done by us using in-silico algorithm. We then took it and validated in the lab. We did it in cell lines and PDX models and mice, et cetera. But one of the unique things that we found, it was available to the brain tumor cells at a level that was 2x that of TMZ. And so this bioavailability is really important. It has 2x the bioavailability compared to the existing standard of care. And so it was also much more effective in MGMT and non-MGMT expressing GBMs. And so that gave us a great market opportunity. So we got initially the FDA orphan designation. We then got fast track designation as well. And one of the reasons is that we see that it has really superior potency compared to standard of care. It works across both MGMT hypermethylated and MGMT unmethylated. It also has, we believe, minimal systemic toxicity. So you'll have a much favorable therapeutic window. And it also works even when brain cancers become drug resistant, whether it be to chemotherapy or temozolomide. So all these things, all these factors kind of add up. And so it really makes it a very unique molecule. And that's why we got both orphan and fast track for this drug. And again, we validated all this work. We modeled it initially. We verified the models in vivo. And now we're designing trials for it, and we expect to start these trials in probably the next several quarters or less. So we're particularly excited about getting the fast track designation and also the designations in pediatric cancers that we've done. Again, we did a lot of work making sure that this molecule showed us this kind of efficacy in lots of different animal models, whether we did flank tumors, orthotopic models, we saw tremendous potency. I mean these graphs alone, you're looking at these tumors in these mice would grow quite rapidly. These are very aggressive GBMs. But if you look at 2 rounds of dosing, we're able to wipe out and kind of keep the tumors in line for quite some time even afterwards, I mean up to 38 days after dosing, which in a mouse is a long time. And some of these models both the U87, these are the mice models of brain cancers. These mice were tumor-free. Now -- and obviously, in adults, it's very different. We're not treating in mice, but mice gave us a good representation of what to expect both from sensitivity to the drug, a safety profile of the drug and the kind of dosing that we think will be optimal. And so based on that, that's how we got these designations. We think there's a really good window also of the drug. The drug doesn't have a lot of -- it doesn't stick around for too long, and that's very important because a lot of the side effects you see, especially with larger, more biologic-based agents, is that sometimes they'll sit and have a half-life of days, sometimes weeks, and that can really pose problems, especially with toxic agents or agents that change the biology. And so the fact that this drug, what we have seen so far has a half-life of about 20 minutes and it gets cleared out, is a good sign for us. That means the toxicity, if there's going to be any, will leave the body quite rapidly. So this is the kind of stuff that I think excites drug developers, that excites us because it works across not just primary brain cancers but also it works in brain mets. And the number of people that die from brain cancer every year is terrible, but the number of people that die from cancers that go to the brain as metastatic tumors is even more. It's about 3.5x. And so again, one of the things that we were able to do with data, this is where data comes in again, is we're able to look at what regular solid tumors are sensitive to the drug. Is there a difference between the genomic profile of those that go metastatic versus those that don't? What are the differences? And are those differences enough to give us concern or those differences that we can exploit? And so we've published that our drug is very sensitive in triple-negative breast cancer, especially triple-negative breast cancer that goes to the brain, brain mets. And again, we saw that with our drug, this is comparing it to an FDA-approved agent of ENHERTU, and as you can see, there's a lot of drug that's given, with ENHERTU, it's 10 mg per kg. With ours, it's either 4 or 3. So dosing levels are lower. But also, if you look at the effect, we think the effect is also superior. And so this, again, gives us kind of excitement that we can make a pronounced difference with this drug. Again, we tested across lots of different models of triple-negative breast cancer. We looked at it in different conditions, meaning PARP resistant, PARP sensitive. And again, all these breast cancer, about 50% almost, believe it or not, John, of these tumors actually go to the brain. And so oftentimes, a woman with triple-negative breast cancer, which is a very aggressive one, will not necessarily fall victim to the primary tumor, but it's really the secondary tumor that goes to the brain. And we found now by doing this kind of profiling of the brain mets versus the primary tumor and looking for commonalities, we can actually treat many of these brain mets as well. So this is, to us, very exciting, gives our drug a lot of potential, both in primary solid tumors but also in many of these brain cancers, both primary brain cancers and secondary brain cancers. And again, in all cases, we published extensively at places like AACR, SOHO, the San Antonio Breast Cancer Symposium, Society of Neuro-Oncology, et cetera. Talking about the other half of this is in childhood cancers. As I mentioned, there's probably going to be, I believe, a real renaissance in treating pediatric cancers. And our focus really is going to be initially with some of these brain cancers. You saw low-grade gliomas get an approval this year. That's a childhood cancer that Day 1 did a great job with. And then also, I think there's another drug that's now being developed by Chimerix in HK27-mutated brain cancers, which also can affect kids. And so again, these are some -- you're going to see a lot of approvals. And the reason is that we're now able to use data to uncover what tumors are going to be sensitive and what's the underlying genomic profile. Again, we did this in ATRT. We have an orphan designation. We also have a rare pediatric voucher. And since this voucher, we've also gotten 3 more vouchers. We published this in the Frontiers in Drug Discovery exactly 2 years ago, I think, in October 2022. This was done with the National Cancer Institute with their Therapeutic Development Commons Initiative. And we found that there was a very specific mutation that occurred in some of these pediatric cancers regarding SMARCB1 and SMARCA4. And as you can see, with no mutation, tumors are somewhat sensitive in the red. But when they have a SMARCA4 or SMARCB1 mutation, these tumors become hypersensitive to the drug. And the reason that's important is, again, in these pediatric cancers, you're going to have a lower dose -- and again, kids are also going to be much more sensitive potentially if there are going to be trigger events or side effects. And so getting this kind of prediction that the tumors are sensitive in the first case at a pretty low dose, 200 to 250, which is wonderful. But when they have these 2 mutations and in ATRT, 90% of ATRT has this mutation. And that leads to chromatin modeling and folding problems. So meaning the DNA in the cancer cell is somewhat vulnerable. And so since our drug attacks the DNA of cancer cells and breaks them, that makes those cells even more vulnerable. And so there are 3 different types of ATRT. We showed very good potency across all of them. And again, this was published, and this was done using not just genetic data and epigenetic data, but also protein data. And again, this is a great way that data can come together to uncover something and give you a lot of confidence that it's going to work. And again, as we took this data from in silico to the mice and rats and other models, we continue to see the same thing that we saw exquisite sensitivity, and we saw a lot of cell death. And so this is an ATRT. We gave the doses at 4 and 2, and as you can see, it really wiped out these tumors through this kind of dosing. We did 5 doses over 2 cycles. And as you can see, days after treatment, even well over 1.5 months after starting treatment, there was virtually no tumor in these mice. And again, this was published data. And so do we expect the kids to go tumor free? I don't know. I think that would be great if we can get that kind of complete response. But even if you can have a partial response that's significant, that would be great because these kids right now, the only option they have, John, is radiation treatment. And that's not great, and it causes hearing loss and it causes lots, but that's the only option that they have. They do get chemotherapy, but these tumors aren't really sensitive to chemotherapy. So you get a lot of the bad effect of chemotherapy, but not really the intended good effect. And so these kind of more targeted agents like LP-184 that it's tumor site activated, meaning there's no reason for the drug to really even turn on until it gets to the right level of enzyme inside the tumor that makes for a really unique molecule. And that's why we're going after a lot of these populations like brain cancers and kids where we can find computational predictions and then take those computational predictions and then validate those in vivo and then show them across multiple systems and get comfort that there's a reason to then have a trial. Our next big category also that we're going to go after next is going to be some of the pediatric sarcomas. So we're not just stopping. We're finding a lot of things. That's the great thing about AI is that the amount of data that you generate every time you do another experiment is massive, and that can start giving you directionality as to what your options are. And so that's, I think, one of the most exciting things is that you have a lot of directionality. And more importantly, the more research you do, the more data you can use. The more data you can use, the more you can uncover, the more confidence you can build to support your models, and those models can help you get the right kind of regulatory approvals and those models can help you design trials that are really effective. And that's what we're doing. And I think we're going to keep doing that over and over and over and partner with larger pharma after we have shown sufficient evidence in clinics as well. So that's a pretty detailed review. I thought maybe I could take a quick pause and perhaps answer some questions people might have.

Absolutely. Thank you, Panna. Just a quick reminder, you do have the ability to send in additional questions. We'll do our best to get it done today, but we do have limited time. You just send it through the Zoom chat feature. And one thing I would note as I see some folks from the Arizona area is, in fact, next week, we will be having Panna out there for a really significant Speak engagement on Monday the 4, but then -- which is a closed meeting for participants there. But on Tuesday, November 5, we will be having a lunch -- CEO Luncheon event with Panna in the North Scottsdale area. So if you are from that area and know that you can contact us and make sure that you get that invite and those will be going out after this. But again, thank you for the questions you've sent in. A couple of the folks are wanting because they're more on the financial side of the world. As you are a public company that many are invested, one of the questions they'd like is just a quick financial snapshot of where you are and that's in the public domain. If you could help us get that summary, issued and outstanding shares, things of that nature, cash runway, whatever you feel comfortable in sharing today, Panna, that would be very -- that would be welcome here.

No problem. So our last reported quarter was quarter ending June 30. We'll be reporting the September ending quarter sometime in the next couple of weeks. We had $33.5 million in cash. That should run us for the next 6 to 8 quarters. Our burn rate historically has been between about $4.5 million and $5 million. If you take a look at our last 4 quarters, the burn rate has been right under $4 million. But as the trials are going on, we expect to be closer to $4.5 million to $5 million over the next couple of quarters, and it will probably peak this year or Q1 and be fairly flat or down after that. So we think we've got sufficient capital to get the trials done, but more importantly, get the drugs partnered out. And hopefully, as we share data from our trials like our Phase II trial or Phase I trials, we'll see some good positive movement in the stock. We have about 10.7 million shares, primary shares, on a fully diluted basis, that including options for employees and others, about 12 -- a little under 12, 11.9 million, I believe 8, but 10.7 million primary shares, of which close to 3 million or so are pretty tightly held. So the float is fairly small in our company. So a couple of tens of thousands or hundreds of thousands of shares don't think can make it go one way or another.

For sure. The follow-up question is that you mentioned partnering. You've had some success in actually partnering and leveraging your RADR platform with other organizations. And actually, one of them, I believe, went public to Actuate Therapeutics, where you not only had a partnership with them as far as possible, I believe you can profit from the upside, but also have actual ownership of their shares. Could you speak to the nature of that and the possibility of doing that in the future as well?

Yes, we've done that 3 times now. We've partnered with Actuate that went public. I think we did some great work for them. We still have a partnership. We'll have a webinar later this week about that work, and we got a nice chunk of shares in their company. And hopefully, as they succeed, that will be success for us when those shares will translate into cash that we can use to fund operations, fund other initiatives. We've done the same thing with our work with TTC Oncology and Oregon as well. Interestingly enough, I'm pretty excited by some of the work that's actually being done in the pediatric space by some of the companies now because people are seeing that it's kind of a new frontier. I think the approval by day 1 that they had was very exciting. And again, interesting thing, that was a drug that VCs didn't even want to fund ironically. So it's just -- to me, it just maps to the lack of creativity sometimes in these "health care VCs" have. But it was funded by patient group, believe it or not, it's funded by parents, the day 1 drug initially. And then it got momentum and it got funded. And -- but that -- it's just a great story, and that really opened up a lot of people's thinking about these pediatric designations. And so I think there's a lot of interest now in the biopharma community to look at pediatric designations. And again, we have 4 of them. So one of the thoughts that we've often had is how do we partner with a company that really can do pediatric trials later stage or has a high-level corporate commitment to that. And I think that that would be a great area for us to look at and partner. Pediatric trials have their own unique place, but we think we've got a great portfolio in the pediatric space right now, given the multiple designations and given just the sheer volume of data that we've been able to generate and prove new labs.