Moleculin Biotech, Inc. (MBRX) Earnings Call Transcript & Summary

We appreciate everyone's patience. Good morning, and welcome to Moleculin Biotech's Virtual Acute Myeloid Leukemia KOL Event. My name is Jenene Thomas, and I will be the moderator for today's event. At this time, I would like to remind our audience that remarks made during this webcast may state management's intentions, beliefs, expectations or future projections. These are forward-looking statements and involve risks and uncertainties. Forward-looking statements on this call are made pursuant to the safe harbor provisions of the federal securities laws and are based on Moleculin's current expectations, and actual results could differ materially. As a result, you should not place undue reliance on any forward-looking statements. Some of the factors that could cause actual results to differ materially from these contemplated by such forward-looking statements are discussed in the periodic reports Moleculin files with the Securities and Exchange Commission. These documents are available in the Investors section of the company's website and on the Securities and Exchange Commission's website. We encourage you to review these documents carefully. Additionally, certain information contained in this webcast relates to or is based on studies, publications, surveys and other data obtained from third-party sources and the company's own estimates and research. While the company believes these third-party sources to be reliable as of the date of this presentation, it does not independently verify and makes no representation as to the adequacy, fairness, accuracy or completeness of or any independent source or verify any information obtained from third-party source. Any data discussed regarding clinical trials and progress are considered preliminary and subject to change. So for today's agenda topics, we will start with KOL introduction, then move right to an annamycin overview. The discussion will then turn to anthracycline's powerful treatment tools, then Annamycin potential to revolutionize the AML treatment landscape, followed by annnamycin, the first non-cardiotoxic anthracycline and ending with MIRACLE Phase III pivotal clinical trial. So joining us on today's call from leadership team are Walter Klemp, Chief Executive Officer; and Dr. John Paul, Senior Chief Medical Officer. Along with key opinion leaders, Dr. Michael Andreeff, Giovanni Martinelli, and Mohamad Cherry. I'd like to welcome everyone, and we'd like to start with introduction. So Dr. Andreeff, we'll start with you.

Yes. Good morning. I'm an attending physician professor at the University of Texas, MD Anderson Cancer Center. I've been involved in leukemia, preclinical research and clinical research for a lifetime. That means very long. And I'm very excited about having finally a new class of agents and old class of agents with a new agent that I think has the potential to make inroads into leukemia treatment.

Excellent. Thank you. Dr. Martinelli, we'll go with you.

Yes, I'm Giovanni Martinelli, University of Bologna. I was for 6 years also Scientific Director of Comprehensive Cancer Care Research and Network in Romania [indiscernible] 1.2 million. In my career, I get -- I'm constantly involved within acute myeloid leukemia patients treatment. And I have my background, roughly 22 clinical trial in which we started from the dose finding to the registration and reimbursement of the drugs. So most of the drug that have been used in this moment has been passed to my hands. So I'm proud to be part also on the development of these drugs of moleculin.

Great. And Dr. Cherry?

Thank you for the invitation. So I worked in Morristown, New Jersey and the Medical Director of Hematology and Oncology. My main interest is acute leukemia. Actually, I did some of my training at MD Anderson, where Dr. Andre is working. And then I came back to Oklahoma University, where I built the leukemia program close to 14 years ago. And then after 7 years, I joined Morristown Medical Center to build the blood cancer program. My main interest, as I mentioned, is acute leukemia, and I'm highly involved in clinical trials, and I'm very interested in the discussions today because the concept of a non-cardiotoxic anthracycline is very, very important in my opinion, and I look forward to this discussion today.

Wonderful, thank you. So Walter, [indiscernible]

Thanks, Jenene, and thank you to our esteemed panelists for joining us today. We view this as a very significant event for analysts and investors. And to be sure, those of us that are focused on moleculin stock are honestly baffled that our market cap is nowhere near what it should be for a Phase III asset in a space like AML. It's certainly not consistent with our data. Annamycin has delivered some strong efficacy results that we'll ask our panelists to review today. And we've shown in 84 patients treated so far that our drug is completely non-cardiotoxic, something that never previously thought possible with an anthracycline. We've got an exciting Phase III plan that we'll discuss today as well. And in addition to our strong efficacy and safety data, our drug is patented through 2040 with both orphan drug and Fast Track designation. And all of this has us positioned to deliver important milestones as we finish this year starting up the MIRACLE trial that we'll talk about today. We expect to announce first patient treated in the first quarter of '25 and even to provide a peek at the date by the end of '25. So things are moving quickly. But perhaps most importantly, our key unblinded data readout is expected in mid-'26. And we really believe at that point, that's when development partners will likely be involved to a much, much greater extent. But all of this begs the question, where is the disconnect in the annamycin opportunity? And frankly, this call is really intended to help tease that out. Clearly, there are some factors that are common to a lot of small biotechs, including the market in general, which is terrible and the concern for financing overhang. But there's also a factor that's unique to our technology. And in my view, for the last 5 years, especially, all investors have been hearing about in the AML space and oncology in general are targeted therapies. And targeted therapies are important, but the fact is that nearly half of all cancers are still treated with an anthracycline. I mean 32% of all breast cancers, half of AML patients 70% of all lymphomas and 60% of all childhood cancers are treated with an anthracycline. Yet for all their success and importance, anthracyclines haven't fundamentally changed in over 50 years, which means they don't often hit the radar screen when investors are looking for biotech plays. And we think that's really what makes Moleculin such a hidden opportunity. Now the purpose of today is to give analysts and investors a chance to hear directly from practicing clinicians and thought leaders in AML firsthand.

So let me start things off by asking just some positioning questions. First off, notwithstanding the intense focus on targeted therapies in recent times, is it fair to say -- I'm asking the panelists now, is it fair to say that there remains a significant unmet need in relapsed/refractory AML?

I start. There is a great need of new therapy, a new approach in relapsed/refractory acute myeloid leukemia. Mostly of the company, I mentioned the big pharma company. I'm in contact with more than 400 company, pharmaceutical company in this moment. And you are one the more relevant one who decided to work on relapsed/refractory acute myeloid leukemia. I presented 2 years ago a project, a European community that was financed for 6 million, which is nothing for a pharma, but it's a lot of money for university in order to collect acute myeloid leukemia, relapsed/refractory. In Europe, we are expecting to get 22,000 people every year in this moment still alive with a relapsed/refractory acute myeloid leukemia. And there is a big, huge capacity and potential to treat this patient that in this moment, the survival is less than 3 months. So I personally find very important for a pharma company to stay in the field to activate and stay in the field with the clinical trial in relapsed/refractory acute myeloid leukemia. We are -- as we were 30 years ago in the newly diagnosed patients in relapsed/refractory. We don't have drugs. We don't have any possibility. Only one company, which is the Astellas with gilteritinib, as you mentioned, a part of therapy is the only one who has tracks through this in Europe, which is a big market of acute myeloid leukemia. In this moment that are getting a registration of the drug in relapsed and refractory. Also venetoclax is not registered completely and not completely fully in all the European states in relapsed/refractory. So there is a totally opportunity for a company to develop drugs in relapsed/refractory.

Dr. Andreeff, I know you're part of the team that helped develop venetoclax. And I'm curious from your -- I know in a previous conversation with you, you said to me that you thought that the lack of cross-resistance that annamycin seems to have might be as important as the lack of cardiotoxicity. Could you expand on that?

Yes. So let me comment on the venetoclax scenario first. We now have remissions in 70% to 90% of patients, many patients could not even be treated before. However, the vast majority of these patients relapses. And that's where new agents come in. And it will not be the highly targeted agents. We need agents that have a broader spectrum of activity and do not target a single mutation. When you really think about the last 15 years, there are 2 mutations that we can target, FLT3 and IDH. And I think that's about it. After 15 years, and venetoclax was so successful because it's not mutation specific. So now we have vast majority of patients who get initially venetoclax and hypomethylating agents and then they relapse. And now what? So now we need agents that are not cross-resistant with venetoclax that have a different mechanism of action for sure. And so now we are falling back to our old-fashioned chemotherapy, which hasn't changed in 50 years, as you point out. And now we have a new anthracycline, which may be much better than idarubicin and daunorubicin. And that's the starting point, I think, for this conversation.

Great. Dr. Cherry, any thoughts to add here?

I mean, definitely, there is unmet need. And we have to remember that more than 50% of patients are still dying from AML despite all the recent advances and the situation is more gram and the relapsed/refractory setting, where if you don't have a targetable mutation, then your only chance for cure is bone marrow transplant. And as you -- everybody knows, many of our patients are not candidates for bone marrow transplant because we're dealing with an older population. So the exciting idea about a new anthracycline without cardiotoxicity is extremely important and especially where venetoclax might fail. As Dr. Andre said that after a hypomethylating agent and venetoclax, if you fail this treatment, then the outcome is extremely, extremely dismal. The survival is in the order of 2 to 3 months. So I feel that this is the area where there is unmet need, and I'm very excited about this study that you are conducting.

Fantastic. Let me just ask the operator if there are any questions from the audience at this point. We've got other more detailed discussions to go into about the data and the trial design. But in the overall positioning, are there questions from the audience?

Our first question is coming from Jonathan Aschoff from ROTH Capital Partners.

So Wally, you were talking about the stock, and I certainly get where you're coming from. And so my question is, I think what would help that immensely is if data could happen before roughly 2 years from now. So can you maybe help us understand how conservative your time line estimate is now and just, therefore, how much room there is to show us some cards than 2 months from now?

Yes, understood. And by the way, Jonathan, this will -- we'll go into this in a bit more detail later in the program. But just -- it's a very important question. So let me give you the short answer, and we can give more detail later. But the short answer is by mid-'25, so basically 2.5 quarters from now, we expect to have some midpoint data that we think will be indicative of the direction this trial is going. And there's -- it's because of the math and the disparity in performance between the control arm and the test arm, but it will start to become obvious that Annamycin is winning this trial. And so you're right in asking that question. We don't have to wait 2 years to know that we're winning, okay?

But sooner than 2 years, like what you're referring to, that will still be blinded, correct? It will just be performing as a group better than expected if everybody was getting nothing.

Exactly. It will be blinded. But when you do the math, because the HiDAC control arm has a pretty well-known history of performance level, it will -- mathematically, it will be obvious. It wouldn't be possible to have as many responses as we will be having if annamycin weren't performing. So...

Okay. So just one more follow-on, and then I'll stop for the moment. Exactly how consistent has your placebo group performed trial to trial regardless of what trial it's been in. It's still the same placebo group and only in trials where they're looking at the same types of patients that you're looking at, how consistent has that been over the last decade or so? Because that's going to be extremely important [indiscernible] placebo group...

Yes, we're going to show you a chart that shows 2 very large published, very respected trials where the control arm was HiDAC, which is the same as our control arm, 10 years apart. And there's barely a 1 point difference between the performance in those 2 different trials. And I know that the -- when we get to that data, I know the docs here will want to weigh in on -- they'll have their own additional thoughts about that consistent data, right?

Okay. Just because you really have to have as the only variable, the blindedness of your data. The placebo has to be really something you can depend upon a given performance when the data you're looking at still blinded.

Understood. And I promise you we're going to drill down on that a little bit later in this program, okay? Any other questions, operator?

Not at this time. I'll turn it over to you.

Sure. We do have a question actually, Wally, from the audience. Can you talk about how resistance forms to existing anthracyclines and generally speaking, which tends to come first for patients, resistance, relapse or cardiotoxicity?

I'll invite one of the clinicians to weigh in on that.

This question could be for me probably for -- until now, we get a great, great confidence with this drug. we were a bit -- at the beginning, we get some potentially difficulties on preparing the drugs for pharma. And -- but on the clinical level, we find the drugs absolutely, absolutely sure and safe. All the patients treated were very, very well tolerated the infusion and all the patients getting particularly no sign of difficulty to get -- and we don't get any management of the difficulty to deliver the drugs and no cardiotoxicity at all until now. So it was true, let me say, when you started experimental drugs, the company says is safe, but it's true that the drug is safe in this moment. It's very safe.

I think to maybe I thought I heard something else in that question, which was when you treat a patient first line, is it more common that they are refractory to first-line treatments? Is it more common that they relapse? And/or how common is it that you can't treat a patient first with 7+3 because of cardiac issues?

Is that -- for me this question?

Any of the 3.

I find that when we move to a relapsed and refractory population, particularly the patient fit for previously 3+7 program or fludarabine-based intensive chemotherapy, or mylotarg plus chemotherapyy, 3+7 plus mylotarg and other patients has been treated this way. The patient comes out from this 1 or 2 cycle of initial chemotherapy very fragile. Usually, the patients lose a lot of weight. They are potentially previously infection, particularly lung infection, fungal infection. So the quality of the patients, let me say, even if checked and controlled by the inclusion criteria is a poor population. So a population that is more fragile from the induction phase and the previously exposed to the chemotherapy. So that population is a population that sometimes also has a prolonged exposure to neutropenia. And it is a population that at the end of the day, becomes an additional fragile population, even if they were fragile from the beginning. So it's very difficult to treat the patients in this situation. A lot of people believe that they have not to be submitted again to another course of this kind of drug, but the drug we used was successful for -- at least for the safety profiling.

Okay. Great. Thank you. Other questions before we move to the next section.

That's it, Wally, we can move on.

Sounds good. Okay. So let's -- we'll dive deeper now into a discussion of the data. And to do that, I'm going to invite our Senior Chief Medical Officer, Dr. Paul Waymack, to start us off. Paul?

Thanks, Wally. Annamycin has now accumulated a solid set of data, starting with single-agent clinical trials in AML patients in both the U.S. and in Europe and culminating in our most recent combination trial where annamycin was combined with high-dose Ara-C or HiDAC, which generated some significant efficacy numbers and formed the basis for our meeting with FDA to establish a Phase III approval trial plan. And when you look at the results from our last Phase I/II trial, you can see why we are so excited about these numbers, especially in second-line patients where we saw a 50% CR rate, which we believe is significantly better than any drug currently approved for this class of patients. These were not only durable responses, but we saw responses in fit patients coming off 7+3 therapy and unfit patients coming off ven/aza therapy as well as other first-line therapy regimens. Now we recognize the end is relatively small when we focus on just second-line patients in our study. But when you look at all the patients treated around the recommended Phase II dosing regimen. In the last 3 trials combined, we're talking about 35 relapsed or refractory patients, showing a CR rate that would likely win approval, if repeated in a pivotal trial, especially when you compare these results with the results that have won FDA approval thus far for second-line AML therapies. As you see here, of the 5 drugs approved by FDA for use in second-line AML patients, the average CR rate is about 21%. And of course, since all these are targeted therapies. They are only relevant to a small subset of AML patients, which contributes to the significant unmet need for a broadly effective second-line therapy treatment. Wally?

Sorry, unmute. Sorry. Thanks, Paul. So with this as a brief review of the data, let me ask our panelists to weigh in. So maybe to start with, given that targeted therapies have been approved on an average of a 21% CR rate. Do you find the durable 50% CR rate for annamycin compelling for second-line patients? I mean I know you do, but I think our audience would like to hear it.

Okay. So the answer is I'm qualified yes, if we can sustain this. Right now, it's a small number. So I'm sure we are all cautious about this. But if we get close to that, if you have 40%, that would still be -- so in my own thinking, if a drug is 1/3 better than the standard of care, it should be approved. That means a 1/3 higher response rate or 1/3 prolongation of survival. That's to me, P-values for me personally do not matter. I don't care about the p-value if the survival benefit is 1 week or 1 month. So -- but that's my own personal standard. And when you look at the data, we are more than doubling the response rate here from 20% or less to 50%. If it's 40%, it's still 100% more than what we have. So to me, this is highly significant. So we need the Phase III trial to show if this is real or not. And when you look at the individual patients that were treated, these are really bad patients. So I don't think there was a patient selection, which is always suspicion when you have wonderful data. So these are bad patients. 50% responses. If you can replicate that in the Phase III, this should lead to approval. That's my opinion.

Great. Any other thoughts, Dr. Cherry?

Yes. I mean what is interesting that even in patients with targetable mutations, you are getting higher response rate. And remember that 50% of patients don't have any targetable mutations. But as Dr. Andreeff mentioned, if the results are translated to the Phase III clinical trials and even if it is a little bit lower than 50%, this is a huge news for the community. Yes, definitely, the preliminary results are exciting.

Great. Dr. Martinelli, one question we get often is, would you imagine that once approved and a safety track record is established, could you imagine annamycin being used in a first-line setting? Well, I think you're muted. You may be muted.

Okay. Sorry. Absolutely, it's a great drug to be tested. I think it's the best drug to be tested in this moment in the first line because it's a drug that there is no resistance mechanism until now, we know against the use of these drugs. Of course, we are working on in a general mechanism, which looks like to be not general, but is peculiar for acute myeloid leukemia. All the types of acute myeloid leukemia, we know has a difficulty to be targeted in the self-renewal mechanism. So depending from the level of the leukemia stem cells, all the patient with acute myeloid leukemia has extremely sensitive to anthracycline. So this is a potential drug that has to be introduced together with some target therapy. That's my opinion, either or later, either or not, but it has to be integrated with the target therapy. As I mentioned by Andre before, until now, there is a lot of emphasis on target therapy, but there is only EDH1 and potentially also some cases of FLT3, but not all of them. And ATRA, which is a general mechanism ATRA in promyelocytic leukemia that are really eradicating -- able to eradicate the leukemias themselves. So we need to get a backbone of drugs that works, I cannot say all the cases, but in the majority of the cases with acute myeloid leukemia. Probably the AB1 positive leukemia is the only one who was and could be also resistance to acute myeloid leukemia treatment with anthracycline. It's the only types of 4%, 6% of the entire population of acute myeloid leukemia. And another potential category that will be difficult to be touched by anthracycline is probably the p53 double mutated. But the other types of leukemia could be and are until now extremely sensitive to the anthracycline, in particular, these drugs.

Great. Great. Let me just ask anything from the audience as it relates to this question about the positioning of annamycin and the data that Paul just went through.

Wally, we don't have anything at this time.

Sounds good. So Paul, I think it's worth drilling down just a bit on the unique attributes of Annamycin as this tends to get lost in the wider clinical discussions.

Yes, Wally. Indeed, the construct of annamycin is at the core of what makes it so different. The inventor took key aspects from 3 different currently prescribed anthracyclines then combine that with the addition of an iodine atom that significantly changed the PK and PD characteristics. The result is a complete lack of cardiotoxicity that initially the FDA was not buying into. In fact, in our first U.S. trial, FDA would not allow us to dose any patients over their current lifetime anthracycline limit. But I am happy to report that in our last meeting with FDA, we requested that the cardiorenal division weigh in on this issue. After being provided with the data from 84 annamycin-treated patients, most of whom received well over the limit and some of whom we took over 5x the lifetime anthracycline limit, the cardiorenal division concurred with us that they saw no evidence of cardiotoxicity. And so they are now allowing us to treat patients over the lifetime anthracycline dosing limit in our Phase III trial. Beyond the elimination of cardiotoxicity, though, we also see in preclinical models that annamycin avoids the cross-resistance seen with a number of existing AML drugs. This not only includes currently prescribed anthracyclines but also cytarabine and venetoclax. Wally?

Yes. Here again, it would be great to gain some perspective from the panel. Now that even the FDA is beginning to acknowledge annamycin's lack of cardiotoxicity, can you folks comment on the utility of a truly non-cardiotoxic anthracycline?

I can mentioned that in the acute leukemia arena is extremely important fact because the majority of patients diagnosed with acute leukemia, they will receive anthracycline in their induction chemotherapy. And over multiple lines of treatment, you reach the maximum amount. And for each anthracycline, you have like a certain number. And often in the relapsed setting, you face this dilemma like exceed the limit because of the risk of cardiotoxicity. So being able to give anthracycline despite this fact and for example, many of my patients have secondary AML. They were treated for their breast cancer with an anthracycline years before this diagnosis. And even during induction, you cannot give anthracycline, which is very inconvenient and will affect the outcome. Now we have studies that have shown that if you double the dose of anthracycline, especially for daunorubicin from 45 milligrams square meter square to 90 milligrams per meter square in frontline AML, you are improving the response rate and overall survival. So an AML is extremely important. And this, in my mind, translate to other cancers where anthracycline is useful.

Dr. Andreeff, it looks like you had a question.

Yes, I'd like to add a different twist. On this slide, you could see that this drug is MDR1 independent. So that's the P-glycoprotein that comes out anthracyclines and many other agents. And to me, that would indicate that perhaps annamycin is just a better drug. So regardless of the lack of cardiotoxicity, which I think I was present at this FDA meeting. And I think it's pretty clear there is no cardiotoxicity. But beyond that, we need better drugs. And annamycin has the potential because of the independence of MDR1. And to follow up with what Giovanni was saying, AML stem cells have very high levels of MDR1 P-glycoprotein and a drug to eliminate these cells has to be independent. Venetoclax does that to a degree, but -- and annamycin, I think, has the potential of doing that as well. So it's not just the lack of cardiotox. I think it's a potential of having a much better anthracycline that makes it interesting.

Yes. If I can add something regarding this. We strongly need an MCL-1 inhibitor for treating and promoting apoptosis in Acute myeloid leukemia stem cells. And we know the anthracycline, whatever is the type, annamycin is probably the best one, promote strong MCL-1 inhibition without any endothelial activity. So the endothelial are still remain protected because they express several times more MCL-1. And so the endothelia are protected. In the meantime, the blood cells, particularly the stem cell blood cells are touched. So this is another issue that we need to get an anthracycline. We are talking about leukemia, but we can talk regarding all the types of cancer. if we get a strong MCL-1 inhibitor, we induce a strong irreversible proapoptotic activity, which means that whatever is the DNA damage level, whatever is the background molecular or cytogenetic alterations, we strongly promote the apoptosis of this unable to repair the activity that MCL-1 inhibition will promote at a proapoptotic level. So it's a drug with a greater vast majority of activity on leukemia stem cells, whatever is the background genomic or molecular.

We're about to move on to the discussion of the Phase III trial. But before we do, are there any questions from the audience on what we've covered so far?

We received a question from the webcast. So the question is, can you talk about the difference in dosing for annamycin versus the 3 other anthracyclines you showed on the previous slide. Are patients able to get a higher dose or a similar dose, but perhaps for longer duration or both?

Great. And let me just -- for positioning because not all the panelists are focused on the specific aspects of the trial history here. But most of the patients treated where we've seen responses have been in the 190 to 230 milligrams per square meter of annamycin. That, of course, is in combination with HiDAC. So that's your reference point versus, let's say, traditional 7+3 therapy.

Can I make a comment for our person we are listening. I don't believe we have to increase the dosage too much the doses of an anthracycline. A lot of companies make the mistake to consider the initial stage of leukemia as the only one to be curd. So when we start to treat leukemia, we get thousands and thousands of billions of cancer cells. And so we need more drugs. But moving to the reduction, the cytotoxic activity, we need daily less drugs. And particularly in the elderly population with leukemia, we make experience that also in venetoclax treated patients, we started at the beginning with 800 in BCL leukemia, then we reduced it to 400, then we reduced to 200. Now we know that for elderly, very elderly population, we can use only 50 milligrams of venetoclax. And this is the same for all the drugs from Ponatinib in acute lymphocytic leukemia with tyrosine kinase inhibitor, all the drugs we are using, we start with a lot of drugs because we get a great amount of cancer stem cells at the beginning. But after a few days, a few hours, these great amounts of cells come down. So I'm not afraid to reach the higher level of infusion of these drugs since probably we don't need to reach a high level. Also, this will be important for the development, the price and so on. But it's important to understood how we can treat the patient with the low level of the drugs, which low level can be reached in the majority of the patients without any significant toxicity, particularly in the combination that we need to have in order to avoid any mechanism of resistance.

Yes, Michael.

Can I add to this? Dr. Martinelli talked about the inhibition of MCL-1. So MCL-1 is the most important resistance factor to venetoclax. And the MCL-1 inhibitors have failed and discontinued. That's a different topic. But if annamycin inhibits MCL-1, the combination of venetoclax and annamycin would be the next step, not just AraC annamycin, but venetoclax annamycin. There's a huge unmet need for that because, as I mentioned before, the vast majority of patients relapse after venetoclax. And we have published several papers showing that MCL-1 is the main resistance factor. So requires some preclinical work. This could be done in 4 weeks or 2 months to show that annamycin should be highly synergistic with venetoclax. Of course, that's not for today's discussion. but to give the audience an idea where this could go, not just with AraC, but certainly with venetoclax, which would open up a huge number of patients, of course.

Fantastic. Well, Paul, I think we should keep plugging forward and dive into the Phase III clinical trial.

Indeed. And as Wally alluded to earlier, we had a very productive meeting with FDA where they were impressed by the strength of our Phase II data and FDA agreed that a Phase III trial could be constructed around using CR rates, that is complete remission rates measured approximately 1 month after initiation of therapy as the primary efficacy endpoint for a new drug application approval. We are calling this the MIRACLE trial, which stands for moleculin relapsed/refractory AML AnnAraC clinical evaluation and hence, the acronym. And part of the reason why we are so excited about this trial is that it allows some early looks at the data. Part of this stems from the fact that the FDA asked us to evaluate more than one dosing regimen of annamycin using an adaptive trial design. So we have structured this as an adaptive trial design with a Part A and a Part B. In Part A, we are comparing annamycin using 2 different dosing regimens in combination with HiDAC to a third treatment arm using HiDAC plus a placebo. This 3-arm comparison design will allow us to break the blind after the initial 90 patients, thereby allowing us to select the optimum annamycin dose to be used to complete Part B of the trial. But of course, this also enables us to see how the trial is progressing with unblinded data. And with as many as 90 patients, we think this will end up being a fairly definitive read on whether or not the trial is destined for success. It is worth noting that we believe approval has been significantly derisked in that the historical CR rates for HiDAC are very well established. Two large major published studies generated highly consistent HDAC CR rates in refractory or relapsed AML patients at around 17% to 18%. Now if you compare those numbers with annamycin's results in all refractory relapsed AML patients, we're seeing about double that performance. But the MIRACLE trial will not be conducted in all refractory relapsed AML patients. It will only be in second-line AML patients where our performance is almost 3x better than HiDAC alone. Given that history here, we feel confident that the MIRACLE trial will lead to a new drug application approval. Wally?

Thanks, Paul. Given the question that we got from Jonathan Aschoff earlier, I wanted to kind of circle back to the panel and ask your opinion about how consistent you think the response rates should be from HDAC as a control arm. I mean, how reliable do you think that 17% to 18% performance number is? You're on mute, Dr. Martinelli?

It takes time sometimes to move from to mute, sorry, I apologize. The question is correct. And we are conducing now a pragmatic clinical trial that I'm spreading all the Europe. We get in this moment, 19 countries that participate to the so-called impact acute myeloid leukemia program. And the question was in this pragmatic after relapsed refractory acute myeloid leukemia, if a patient is sufficiently fit, what's the best procedures, what the best treatment could be an intensive one or a non-intensive one, which means an intense one, which is whatever is currently present in relapsed/refractory AML patients, Fludara, FLAG-IDA [ MAC4, MAC6 ] and so on, which is currently a European program for relapsed refractory population fit for chemotherapy again. And let me say, the patients are not too much excited to pass through another high-intensity chemotherapy program. And secondly, in the low intensity, there is only ven/aza that we know that ven/aza has roughly less than 47% potential capacity and most of the patients paid an infection on pulmonary and some of them died, we get at least 5% of death during the treatment. So the position of intensive chemotherapy personally, I'm not so excited to make a difference harm between 119 and 230, if I understood correctly, the dose because what the difference will be just 30 milligram more of anthracycline if this anthracycline is active in the majority of the patients. So personally, I don't find this an exciting part of the project, even if necessary, probably because it has been discussed with probably FDA and so on. What I'm thinking is, is this a program only for fit patient relapsed or we would like -- the company would like also to catch all the intermediate fit for chemotherapy. The patient that the clinical -- European clinician has adopted to treat the patient with intensive chemotherapy again versus some less intensive approaches since the patients -- I'm thinking about 65, 68, 72 years old population that probably also 61 who has failed the first intensive chemotherapy and then has to be treated again. And is this approach that can catch the majority of relapsed or refractory population in order to get a clear indication that annamycin could be or will be the best drug to treat any relapsed or refractory population. That is my rebutted question to the rebutted panel.

So Paul, you might weigh in relative to inclusion/exclusion criteria here because I think that speaks to Dr. Martinelli's question.

In our Phase I/II study, we enrolled all patients, be they fit or unfit, including we have 80-year-old who is now 1.5 years post treatment, still in complete remission, traveling the world. So we are not limiting it to just fit patient or unfit. They both seem to do very well. Even the unfit, they do not have cardiac deterioration. They tolerated generally well. So for our pivotal trial, we are allowing any patient to enroll, be they fit or unfit within reason. As long as they don't have liver failure or kidney failure, they can be enrolled because they all did well in our Phase I/II study. That also helps speed recruitment, I would point out.

Yes. That will be very important. The speed of recruitment will be an important issue. So the proposal is very exciting, and it can be fitting a lot of interest at European level at least. And a lot of country doesn't have nothing, nothing because they get nothing to be proposed relapsed or refractory AML population. So even if -- I prefer to simplify the program that has been discussed with the FDA. So it's probably the good program to be done. I personally believe that if you get a good data with 190 milligrams, why not to use this, which is probably the more safer because you have not only cardiotoxicity, you have to take in account also the fungal infection, the lung infection, the fever, the general infection that anthracycline will could integrate in the activity. So it's not a fragility related only to cardiotoxicity, but it's related to the patients that we are treating with a failure before and a long -- prolonged high exposure to intensive chemotherapy.

And I would point out that is why the FDA requested this design where we do 90 patients with the 230 milligrams, the 190 milligrams and placebo so that if there is no difference, we will go forward with the 190. And I would also point out, as Wally has stated in the past, we know what to expect from HiDAC. Those 2 trials each had over -- well over 100 patients getting HiDAC plus placebo. So this 17% to 18% is pretty well established. So although we will not be unblinding the data, if we -- the data as a whole, when it's still blinded, annamycin versus placebo, if we're getting CR rates of 30% or better, we got a pretty good idea from where it's going or at least I think we can guess.

Dr. Cherry, Dr. Andre, would you agree with that kind of mental gymnastics there that the HDAC performance is well enough known in history that we can probably make that kind of conclusion.

There's nothing better known than HiDAC, right? After 50 years, you should have some idea what the efficacy is.

This is another point -- sorry, Cherry, sorry. This is another point that the control arm is not so attractive either for researcher or for the patients. Personally, I believe that we know what we are expecting with HiDAC. And this is something that arise the question, who is the patients who will receive HiDAC without getting suspicious that the rate of CR could be so low in this harm. So I personally believe that venetoclax azacitidine in relapsed/refractory population could be a control harm. I don't know what the MD also the FDA is asking for a company in the intention chemotherapy. But probably the intensive chemotherapy could be a potential counter harm also in this program.

Dr. Cherry, I looked like you had a comment.

I mean it's an acceptable comparative arm. And I imagine many of the patients that will get enrolled have already received venetoclax and hypomethylating agent, and this is in the second-line setting. But for HiDAC as a single agent, I think what is proposed and the percentage of CR are consistent with the historical value.

And it's worth pointing out, Paul, I think, mentioned this in his section. But to your point, Dr. Martinelli, we were very sensitive here. In fact, Dr. Andreeff was on the phone with the FDA explaining to them because originally, the FDA wanted this to be a longer duration of treatment. And Dr. Andreeff just said, look, that's borderline unethical to treat someone who's not responding to continue to treat them with HiDAC. And as soon as the word unethical came out, the FDA backpedaled quickly and said, no, no, no, no. We don't want anything that might be considered unethical. And what was suggested was that after 30 days, if the patient is not responding, they can move to essentially investigator's choice. And so to your point, Dr. Martinelli, we think this at least helped to make the trial maybe a little more attractive even if a patient is going to get the control arm, it's only 30 days and then immediately moved to whatever their clinician recommends.

As a former FDA medical officer, let me also point out that this design they wanted where the HiDAC can be expected to get a 17% to 18% CR rate. The drugs the FDA has approved for second-line therapy, their average is 21%. It's not a big difference between 18% and 21%. And as Wally said, after 30 days, you can go into anything you want. And we are not having difficulty finding sites that want to be part of the study and consider this study an ethical study.

Yes. Yes. Let me just pause for a moment and make sure there are any questions from the audience that we can wrap this up with.

[Operator Instructions] Jenene, over to you at this time.

Thank you, Kevin. So Wally, we do have quite a few from the web, and I will start asking them now. So the first one is, can you talk about the difference in dosing for Annamycin versus the 3 other anthracyclines you showed on the previous -- I think we just asked that. I'm sorry. I apologize, Wally. Yes. So is the strategy to seek FDA approval for AnnAraC combination or Annamycin stand-alone? And if the latter, will the trial tease out the benefit of Annamycin versus Ara-C to support the approval?

I guess that's for me. Sure. The indication for the initial approval would be the combination for treating refractory relapsed AML, and it would be based on our having a higher CR rate with annamycin plus HiDAC compared to HiDAC alone. That would be our initial indication. Obviously, as been discussed, we would move on to other leukemias or we would move on to first line. We would move on to third line. We would move on to other leukemias, other cancers in general. But we're going down this road first because it's the quickest path to an NDA.

Okay. Our next question, what is the cost of the Phase IIIa approximately?

That estimate is around $60 million.

Okay. Kevin, can you take Chat, please?

So we do have a question from [Chad Young ] from Maxim Group.

We were just wondering if you could remind us on potential time lines to data and what would be considered a clinically meaningful outcome.

Sure. So the trial -- right now, we are in the site selection mode, and we expect to have our first patient treated in January of '25. we're bringing on a lot of sites. There's a tremendous amount of interest here, and we'll be on multiple continents. So it should move quickly. We expect to reach the midpoint of the Part A of the trial by the, let's say, around the fourth quarter of '25 -- third or fourth quarter of '25. And at that point, as we've been discussing, we would be able to share the data broadly, the overall data with the public. It will be blinded. But because there's such a huge differential in expected performance between the control group and the test group, it will be mathematically obvious whether or not the trial is succeeding. That's why Jonathan was kind of trying to drill down on how reliable the HiDAC numbers are. And Dr. Andre kind of, I think, kind of put that one to bed for us. And then the next milestone of data would be the completion of Part A, and that's expected in second -- around second quarter, let's call it, mid-2026.

Okay. Our next question from the web is, are you expecting much of a difference in response rate between the 2 annamycin doses? And given these patients are earlier stage than your previous study, do you think that there's potential to push the dose even higher?

Paul, do you want to start us off there?

Yes. We could have pushed the dose higher. At 230, we were -- we did not reach MTD. We could have gone higher. However, at that point, we elected to stop dose escalation because we were getting a 50% CR rate. Go find in an FDA-sanctioned clinical trial, anybody in that ballpark, you can't find them. And so at that point, we said it's an old Virginia saying, when you're writing secretaria, don't get off. We are at 50%. It was time to stop and just further enlarge that to further validate the 50% rate, and that's what we got. The FDA thinks this is a really impressive rate. So that's why they're saying, we don't want you going higher. We want you going lower. That was conveyed to us at the meeting. Go lower because this is impressive at 230, but can 190 get you the same results. They didn't want us to go higher. the numbers we got at 230 was more than enough. They want to see if 190 is as good. If it is, then for Part B, we'll do 190. If it's not, we'll do 230. But FDA -- we agreed when we said at 230, we're stopping, we're going to the FDA and FDA concerned, don't go higher, go lower.

Okay. Our next question is thinking about the data that will be reported at the Part A midpoint in 2025, what would you consider to be a good indicator to show that annamycin is working or at least trending in the right direction?

Yes, Paul, you answered that once before, but would you mind repeating that?

First, the -- well, the midpoint in Part A, we're not going to unblind. We're just looking at the data actually in real time and saying, is this above the 17% to 18% you would expect with just HiDAC. The higher it is, the more convinced we are. When we do the unblinding, which would be in mid-2026, we will take the numbers. And if as expected, HiDAC is between 15% and 20%, it would be a little broader range because it'd just be 30 patients. We would expect the 230 milligrams of annamycin to be well above 30% CR, maybe above 40%, 190, probably almost as good, if not as good. We're not expecting statistical significance. But if the p-value comes in at 0.1 or so, we will be quite pleased and be going forward.

But I would just add, at that point, at that midpoint, the blinded data review, if you will, at 45 patients. Practically speaking, that means approximately 15 patients in the HDAC arm, the control arm, 15 patients in the 190 arm and 15 patients in the 230 arm. Mathematically speaking, we don't expect a statistical difference between the 190 and the 230 arm based on history as we've done 190 as a single agent as well as 230 -- well, 240 as a single agent. And then we've done both of those dose levels in combination with Ara-C historically. So we have enough data to suggest we don't expect a big difference. And if there isn't, then you've got a 40% to 50% CR performer against a 17% or 18% CR performer at a 2:1 ratio. Mathematically, that says the outcome is going to be somewhere north of 27 and probably somewhere south of 40. And if it's in that range, we're golden, right?

May I comment please. I personally believe that you have to randomize 2: 1 or 3:1 as we have done in gilteritinib registration Phase III clinical trial that we published in New England Journal of Medicine in 2019. The randomization to 2:1 or 3:1 could be potentially protect the project enrolling speedily the majority of the patients in the experimental harm and protecting a bit of the population that has in the control arm that we know they are, in some way, not potentially be able to obtain a greater amount of CR. Secondly, it has to be also defined better how you can use -- I totally agree with you in the potentiate the protocol downloading the drugs during the protocol. So potentially also unloading the drugs during the first phases of the treatment, but this is another issue. You have to define better in the unfilled population for transplant procedures because if you get a CR in 50% of your population, you have to transplant the patients in a savage transplant, at least in Europe. And this savage transplant has to be very careful because you save the patients from the CR with a higher CR and you lose the patient in the transplant. So at the end of the day, the overall survival, which is not the endpoint, I don't know if it is the endpoint or event-free survival has to be very carefully indicated because if you get in CR and you move immediately to the transplant and getting that in a saved transplant, you lose the patients not for your drugs, but for the transplantation procedures. So he has to cut off immediately the CR rate that has been obtained from the overall event-free survival, which is a secondary endpoint and has to be cleaned from the toxicity of the transplant.

So I'd like to extend a little bit on the CR. So not all CRs are created equal. We have MRD assessment. Paul, could you go back to the slide, I think you flashed MRD negativity somewhere.

So Justin, I don't know if -- are you able to navigate back to that the swimmers chart that has the CRs going horizontal?

Yes. So the FDA is getting very interested finally in MRD and the problem is that there are no standardized assays. However, 78% MRD negativity. That's a different story than just 50% of poor CRs where the patients relapse after 4 weeks. So I find this very impressive here. This is really spectacular. This is by flow, I suppose, in most cases, not the most sensitive, but 1 in 1,000, 1 in 10,000 cells. So this means that these remissions should be durable and the transplant outcome depends on MDR negativity. And so these patients should also benefit significantly from an allo transplant. We know this is a predictor for outcome in allo transplant. So that's another aspect we didn't discuss, but these CRs are deep CRs and Okay. So that's my point.

Very important point, very important point. Jenene, anything else on your list?

I do have a question from Jonathan Aschoff from ROTH Capital Partners.

When you guys were talking about dose, I'm very curious about the doctors who actually administered this drug, where is their head when it comes to willingness with complete comfort to go pretty far beyond 230 to eke out more efficacy? Or is there something that they see that would keep them in that 190 to 230?

Well, what I can tell you is they had no problems with 230. They understand why we stopped escalating. But the 230, that's one dose, 1 dose in a day. They get 3 of these. So they are actually getting about 700 milligrams per meter square in a cycle, which is more than the lifetime acceptable level for FDA. So just 1 cycle, we're above the lifetime maximum rate, which got the FDA's attention. And we did this in Europe. We were not going behind the -- we were not doing something illegally in the U.S. We did it in Europe. We went to 230 cycle is 3 doses. And then we did a second cycle and a third. So we are in patients -- in some of these patients, we're around 2,000 milligrams per meter square in this trial. In our sarcoma, we're over 3,000 milligrams per meter square. All of these patients have serial EKG, serial echocardiograms none have shown any cardiac impairment. So as far as annamycin, we have yet to find an MTD in our AML studies and our sarcoma studies despite repeatedly dosing patients many times above the lifetime maximum level as recommended by FDA.

Yes. I mean I asked because you said there wasn't a toxicity problem. 50% efficacy is something you're happy to stop at. 50 is not 100. There's a lot of room to go above 50. And therefore, I'm looking for -- I was asking about the doctor's comfort in going higher than that, you start showing some ridiculously high efficacy, let's say, if this drug is approved in AML with higher doses. And I just think each time you can do that, you make it really clear, AML is not the only place to use it.

That sounds like a number of the many excellent Phase IV studies we hope to conduct in a few years.

And Jonathan, as Dr. Martinelli pointed out, these are not without adverse events, right? So there are -- there's the potential for infection. And logically speaking, that potential for infection goes up as we continue to weaken the patient with higher and higher doses. So it's not -- we don't want to leave listeners with the impression that this is a benign drug. It's chemotherapy. So there are limits, there are practical limits. And I think the conclusion was really once -- and again, I think it came out in some of the discussions that the -- that our clinicians offered up here today, once you reach a threshold level, then you can hit diminishing returns as you try to go higher and higher. And so that's -- all of that kind of factored into how we established this recommended Phase II dose.

I want to add something in other areas like sarcomas, for example, where you use anthracycline as single agent where actually it's the most active single agent in certain sarcomas. And I think this is where a higher dose seems more reasonable because you are using it as single agent. But of course, this will be in later phases. But this is the area where I think to evaluate how much you can push with other non-cardiac toxicity is the area that I would recommend exploring, of course, later on.

Great.

May I make another comment, please? Yes. It is absolutely important not to lose any patients in CR. I saw you MRD picture slides. And if you lose a patient for infection in CR after obtaining a second CR because they are relapsed or refractory is something that is not acceptable because you have to take as much as possible alive the patient relapsed refractory that they obtain a CR. This is a fantastic data, in my opinion, very, very promising, very interesting. So it will be very crucial not to lose any patients obtaining CR. Even if this CR is deeper or not deeper, it depends, but we have to design a program that has permitted that if the patients obtain a CR, we get for sure a prolongation of survival. So we -- the aim of our project is catched. So don't -- we have to design a protocol in which we get the majority of patients enrolled in the program in the experimental harm without, I personally believe not 2 cohort of dosage, which is something that make at least for me, a bit of confusion, but it could be decided and not to lose any patient on training CR. So all the patients on CR has to be alive as much as possible. So whatever is the program after the first cycle has to be very careful taking into account.

Yes. Jenene, any other questions out there?

Yes. We have another question from the web, Wally. The question is, what specific outcomes from the MIRACLE trial would you find most compelling when considering the use of annamycin in your clinical practice?

Well, from the company's perspective, we're very focused on approval. And of course, approval will be based on CR at 30 days, essentially the immediate response. But I think Dr. Martinelli, I think you were just commenting on that, which is it's not just getting to a CR, it's getting them to a bone marrow transplant or getting them an increased overall survival. So are there other thoughts along those lines? I think -- actually, I think Dr. Martinelli really did answer that question, and we couldn't agree with him more that it's not just -- I think actually, Dr. Andreeff's question about how deep the CR relates to this as well. it's not just a game where we get to that magic CR number and we can check the box and move and walk away. That's the start of hopefully extending this patient's life. But if you're not prepared, if you're not prophylaxing for infection and prepared with an allo transplant, if one is available and all of those things, if you're not prepared for success, you can lose everything you hope to gain there. So I would say overall survival, frankly, is probably the most important endpoint in the study, even though it's a secondary endpoint, we're not going to be approved on the basis of overall survival. But tell me if you guys disagree, but I feel like overall survival is the ultimate litmus test.

Can I say another point that arising from several programs. It's not necessary the induction consolidation, second consolidation and transplant, which is the sequential use of intensive chemotherapy in acute leukemia patient fit for chemotherapy has to be immediately translated in a relapsed refractory population. It's not -- we come from a history of this sequential use of the drugs. But it's not necessary. In relapsed refractory population, we can do just one shot, a good one shot and then take the advantage from this one shot to move to the transplantation or maintenance therapy, which has to be defined. So the sequential use induction consolidation 1, consolidation 2 transplantation is a is something that comes from the back, from the previous -- from the older part of the history of the treatment of acute myeloid leukemia. Venetoclax and azacitidine has demonstrated that you can obtain a CR in just one shot in the majority of the patients. And then second and third is just adding a bit of CR in the population, the entire population. So personally, I believe that we have also to take the 1 month CR is a fantastic idea if he works to move on later in a consolidation with less intensive -- more or less intensive than the previously approaches that we have done in acute myeloid leukemia in a relapsed or refractory population. I don't know if it is clear.

Okay. One last check, Jenene, did we clear the board here?

We cleared the board, Wally.

Okay. Well, gentlemen, you've been incredibly generous with your time, and this has been remarkable. So really, really appreciate it. I have a suspicion this is going to be viewed by a lot of folks even after the fact because of the importance of what was said here today. So thank you very much. We look forward to the MIRACLE trial moving forward and to getting your thoughts on the data as it starts to roll out.

Thanks to you. We will see [indiscernible] meeting.

We'll see you soon. Okay. Take care.

Guys. Bye-bye.

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