Oncopeptides AB (publ) (ONCO) Earnings Call Transcript & Summary

Hello, and welcome to the Oncopeptides Q3 2021 Report. [Operator Instructions] Today, I'm pleased to present CEO, Jakob Lindberg. Please go ahead with your meeting.

Thank you very much. We can go to the next slide, Slide #2 first and just go through the regular disclaimers. As you know, while all historical numbers are factual, everything that has to do with the future are either expectations or projections based on our estimates and assessments, just so that everyone is aware. Please go to Slide #3. So thank you, everyone, for joining this call. My name is Jakob Lindberg. I'm the Chief Executive Officer of Oncopeptides. And with me, I have also Dr. Klaas Bakker, Chief Medical Officer; and Annika Muskantor, Chief Financial Officer. We will end, of course, with a regular Q&A. But in the meantime, we will go through 3 blocks, which pertains to the overall situation. We will go through what we are doing on the R&D side that Klaas will go through, a few slides on financials, and then I will summarize in the end before the Q&A. Next slide, Slide #4. Thank you. So highlights from the third quarter of 2021. We had year-to-date sales of SEK 140 million or $16.5 million. In the third quarter, this amounted to SEK 54.3 million. That is the equivalent of $6.3 million. We also, during the quarter, reported that melflufen met its primary endpoint of progression-free survival in the Phase III study OCEAN. But on July 8, the FDA requested a partial clinical hold of all clinical studies with melflufen. The FDA furthermore issued a safety communication on July 28. And after that, we also announced an upcoming oncology division advisory committee meeting, an ODAC meeting, that was scheduled for October 28. We also presented a more or less complete OCEAN data set at the IMW meeting on September 11. As we all know, there were events after this quarter, and we will come back to them. Next slide, thank you, Slide #5. Demand growth remained strong all the way into July of PEPAXTO in the U.S. As a matter of fact, July turned out to be our best month so far. At the end of July, the FDA safety communication materially, of course, impacted the demand in August and September. But you can also see that there's still a fairly good demand from the product despite the safety communication that's highlighting the unmet medical need in multiple myeloma. In October, if we go to the next slide, Slide #6, we withdrew PEPAXTO from the U.S. market on the advice from the FDA. According to the FDA, based on the overall survival hazard ratio of 1.104 in the ITT population of the OCEAN trial, the PEPAXTO should not be commercially available in the U.S. market until further studies have been conducted. And this was the main reason. And as you know, we have had a very different view ourselves, but ultimately, this was the outcome with the interaction with the FDA. This resulted, of course, in a plethora of activities to regain control. So if we go to Slide #7, this highlights our short-term or near-term priorities to make sure that we can continue or at least try again to create shareholder value. So the first objective is to secure the cash runway. And to do that, we need to regain cost control or regain to get cost control at the lower cost level than we had. We are very well on our way to do that, and we'll come back to that. In the first quarter of next year, our objective is to reach an agreement with the FDA on path forward for the PDC platform. And then, of course, we continue to support our EMA filing, and we expect the CHMP opinion on melflufen early summer. It depends a little bit whether there will be an oral hearing or not in conjunction with that opinion. So if we go to Slide #8. This is -- we are refocusing the whole company to work with research and development. We're not a commercial operation anymore and our European approval. This means that we are dedicating resources on a much more focused clinical development program of melflufen as previously communicated and press released. We have a new management structure and organization. And of course, we are further developing the next generation of drug candidates coming from the PDC platform, and we hope to do this in collaboration with the FDA and EMA. These are primarily OPD5 and OPDC3. We also need a significant amount of organization activities and resources dedicated to support the European filing. This is because you need to fulfill all requirements for potential conditional marketing authorization of melflufen in the EU. If we go to the next slide, Slide #9. To achieve this, we are then, of course, refocusing the whole operation to research and development. This means that we are closing the commercial organizations in the U.S. and the EU that approximately affects 135 employees that have already been noticed. We are significantly downsizing the Sweden-based headquarters where approximately 70 employees are affected. And we are currently in union negotiations. This means that the company is focused completely on the development of our peptide drug conjugate platform and the EMA filing. If we go to Slide #10, next slide. There are some organizational changes on the leadership team level to achieve this. First of all, our 2 commercial leads for Europe and the U.S., Mohamed Ladha and Andrea are leaving the company as well as the leadership team. Secondly, Sofia Heigis will become Head of Medical Affairs and part of the leadership team. You already know also that Anders Martin-Löf resigned or left as the CFO; and Annika Muskantor has taken his place. Otherwise, the leadership team is unchanged. Now I'm going to give the word to Klaas Bakker that will go through the clinical development and regulatory pathway that's ahead of us. Klaas?

Thank you very much, Jakob. And if we can go to the next slide, please. And as Jakob mentioned, we have a more focused clinical development program, but there were some exceptions and one of this is the OCEAN study. This study will continue, and we will gather long-term follow-up, and we will document all relevant information from this study. Part of this is because OCEAN is also being used for the EMA filing. PORT and BRIDGE, as you may recall, PORT is the trial where we will look at peripheral infusion or have looked at the peripheral infusion of melflufen and BRIDGE a study of melflufen in patients with severe renal impairment are both complete. This means that both of these studies have relevant scientific data set, and our assessment is that these studies can be used for regulatory purposes. ANCHOR we already completely enrolled the daratumumab cohort, and we have sufficient follow-up to draw relevant conclusions. Unfortunately, we won't be able to completely enroll the bortezomib arm ANCHOR study. But still with 20 patients enrolled, we feel that we have enough information to draw preliminary conclusions that we may build upon in the future. ASCENT, the study in amyloidosis, COAST, a study with OPD5 in the stem cell transplant setting; and LIGHTHOUSE, our Phase III combination study with daratumumab, unfortunately, will close with incomplete number of patients enrolled. It won't be possible to draw any relevant scientific conclusions from these studies. Please note that as of today, a significant number of patients is still on treatment. And as patients are paramount to Oncopeptides, we are committed also in the studies that we close to provide patients continued access to melflufen via compassionate use if that is deemed appropriate by their treating physician and of course, if local rules and regulations allow. But we will do everything at our disposal to make sure that patients can still have the benefit from melflufen, if they benefit from the drug. Next slide, please. On the agreement with the FDA, some more details there. As you may know, we are still on clinical hold, both the melflufen program and the OPD5 program. And in order to move forward, we need to lift the clinical hold. So currently, we are in close collaboration and close dialogue, I would say, with the FDA to agree on the regulatory path forward. This means that we are discussing what needs to be done to lift the clinical hold. And one of the pieces there is that it is our assessment, and this has been confirmed by the FDA, that we need to even further define our dose. So one of the pieces that will have to be in place is a robust dose finding study, and we will hopefully initiate that study next year after we reach agreement of the FDA on a path forward. The next slide, please. The EMA filing with an expected CHMP opinion in the early summer as Jakob mentioned. We have an ongoing dialogue with the EMA. And because of that dialogue, we are still committed to fulfill all requirements for a potential conditional marketing authorization of melflufen in the EU. As a consequence of that, we have kept the early access program ongoing in Europe, and we are still getting numerous requests every week. This means that there is still a high unmet medical need in Europe and we are committed to continue with the early access program as long as we have our regulatory interactions with EMA. In addition, as Germany is the first market where the drug could potentially be launched, we are continuing our work on market access to not lose any time should we get EMA approval. With that, I'm happy to hand it over to Annika Muskantor, our CFO. Thank you.

Thank you, Klaas. If I can ask you all to turn to Slide 16, I'll try to add some color to revenues. Now the third quarter of 2021 was also the third quarter where Oncopeptides reported revenues. Accumulated net revenues for these 3 quarters amounted to SEK 140 million, whereof SEK 54.3 million were attributable to Q3. Sales in the quarter started off on the positive expected trajectory but decreased after the FDA's secured communication on July 28. The reported gross margin that was previously has been high has been adjusted for expected returns. And as inventory has been written down to 0, the accumulated gross margin for the first 9 months came in on 75%. So to continue to talk about the rest of the financials, if I could kindly ask you to turn to Slide 17 to look at OpEx. The operating losses year-to-date amounted to SEK 1.031 billion, which is a slight improvement compared to the same period last year. Now nonrecurring office-related costs driven by the restructuring program were marginal in Q3 and can mainly be attributed to the long-term incentive programs where provisions have been added back without any cash effect. To briefly touch on the major cost drivers, we can conclude that R&D expenses have decreased compared to the same period last year. The reduction is driven by the lower cost of our research programs where the expenses relating to the OCEAN study year-to-date amounted to SEK 109 million, where SEK 31 million are attributable to Q3. The increase in marketing and sales expenses was driven by the commercialization activities, primarily in the U.S. aiming to promote the anticipated increase in sales of PEPAXTO. Oncopeptides had 321 persons employed at the end of the period on September 30, of which about 135 were employed in the U.S. office. Cash flow from operating activities amounted to minus SEK 336.5 million in the quarter and slightly more than SEK 1 billion for the period of 9 months. The cash flow from financing activities were basically 0 in the quarter and the year-to-date flows primarily relate to the direct share issue that was closed in April. But just to touch back on the EIB loan facility that was announced in the fourth quarter of last year. We can conclude that it's currently under renegotiation. That mentioned, it is appropriate to highlight that the initiated restructuring program is expected to give us a cash runway at least through 2022 without including external financing. And with that, I hand back to you, Jakob.

Thank you. So just to go through the summary. So let's go to Slide #19. As Annika mentioned, we expect cash run rate through 2022 at least. And so far, after the decision to withdraw from the U.S. market, we have done what we have promised. We closed the U.S. commercial organization during quarter 4. We closed the European commercial organization during quarter 4. We are in negotiations with the unions at the headquarters here in Sweden, and that is at the final stage. We rapidly closed the activities across clinical studies, exactly like Klaas mentioned earlier, where the main cost driver going forward is for OCEAN where we are continuing with the long-term follow-up. Most of these nonrecurring cost items related to the restructuring of the company will impact the fourth quarter, and of course, will be detailed there as well. If we go to the next slide, Slide #20. So to summarize the whole situation, the withdrawal of PEPAXTO from the U.S. market led to refocus on research and development. We have 3 near-term priorities: To secure the cash runway and to restructure the organization in achieving that. We need to agree on the regulatory path with the FDA as well as EMA for the peptide drug conjugate platform. We expect to reach some sort of agreement during quarter 1 next year. And as Klaas mentioned, we are already in dialogue. We continue to support the filing for -- to EMA, and we expect the CHMP opinion on melflufen with the current application early summer next year. This leads all these measures now result in that we have a cash runway through at least 2022, and we will come back with more details around the long-term strategy in the first quarter of 2022. This was a tumultuous quarter for us as well as the fourth quarter. And I just want to thank especially the organization for being so dedicated as they have been to achieve all these goals under very tough conditions. But right now, let's jump to Slide 21 and Q&A.

[Operator Instructions] Our first question comes from the line of Erik Hultgård from Carnegie.

I have a few, if I may. First, could you elaborate a little bit on the topics that are being discussed with the FDA in order to lift the clinical hold apart from what you mentioned about the dose-study that could start next year and then just if you could confirm whether this dose-finding study will that be based on OPD5 or is it -- will it be based on melflufen? And then finally, what's your confidence level that the EMA process will arrive as another sort of outcome than the FDA process given the hazard ratio of 1.1 in OCEAN for OS? Any reason to be optimistic here in the different outcome?

Thank you, Erik. I will start to comment and then hand over the word to Klaas. Your first question is -- I mean there are 2 topics with the FDA. First is that since we established dose with melflufen, based on the old paradigm in oncology that is still relevant for Europe, that was based on what is called maximum tolerable dose, MTD. Recently, they have launched -- the FDA has launched what they call Project Optimus, which sets slightly different criteria for how the optimal dose should be defined in oncology. And obviously, then the question is, how should we exactly measure a drug such as melflufen or OPD5 in relationship to Project Optimus. So it's very detailed questions around how many cycles do you go through? What exactly should you measure? What should you define as success? The second topic of this is, of course, the patient population, so which patients should be included in light of the OCEAN result. As you know, we had both statistically significant inferior and statistically significant superior overall survival results across prespecified subgroups in OCEAN. And obviously, those groups where melflufen was much, much worse than pomalidomide should, in our opinion, not be included, and exactly how to define and delineate that will also be part of this package. The third question was, which molecule? Right now, we are in dialogue around both. And we will come back to exactly what we're going to do in terms of the clinical development program there. Your second question was -- sorry, Erik, can you repeat the -- the third question was OCEAN and EMA...

Yes. Exactly. So the final question was basically your confidence level in the EMA process and what sort of the -- is there any reason to be optimistic that the EMA and CHMP will derive at a different conclusion in the light of ITT hazard ratio 1.1 for OCEAN on overall survival?

We are in ongoing dialogue with EMA. We have been in discussions with EMA, both after the OCEAN result and after the product withdrawal from the U.S. market. If we thought that the likelihood was 0, we would not throw money on this process. I will -- I am hesitating to quantify or qualify a probability. But obviously, if we didn't believe there was a chance, we wouldn't be doing this. Klaas, I don't know if you would like to add something?

No, I think that covers it all, Jakob.

I was just wondering if there is any specific sort of hurdles or any differences in sort of the review process and how they look at data that could -- that might indicate a different sort of conclusion in Europe and in the U.S.

I mean there are -- you go, Klaas.

Sorry, Jakob. Sorry. No, I think in the end, we talk about 2 different regulatory bodies. So they make their independent assessment. That does not mean that they don't talk to each other. But they also have different guidance. One of the differences sits in the explicit guidance around subgroups where the EMA has detailed out guidance as when to apply subgroup data to -- or considering subgroup data to be real important. That is one of the major differences there. Also, it is important to note that the application is still on the HORIZON data. So we have not submitted OCEAN as a confirmatory study. But the ongoing conditional marketing authorization process is still based on the HORIZON data. Of course, for safety purposes, OCEAN will be taken into account, but we're not talking yet about that as a confirmatory study.

And the next question comes from the line of Patrik Ling from DNB Markets. Yes.

A couple of questions to Jakob and Klaas on the proposed dose finding time. Could you elaborate a little bit more if you think that you need to complete the dose finding before the FDA can lift the clinical hold? Or is that just that you need to have an agreement on how the dose finding trial would look like for them to lift the clinical hold?

I mean we need to lift the clinical hold to conduct the dose finding study. But obviously, it means that they need to accept the arguments that we are putting forth around a patient population where there's a high likelihood of benefit as well as then the parameters of the actual -- what -- how do you measure an appropriate dose. According to Project Optimus if it's not straight in MTB. So there are sort of detailed parameters around that. Klaas, would you like to add something?

No, I think you covered it, Jakob, thanks.

And in the case that you get an agreement with the FDA during, say, late Q1 on how to design a dose-finding trial for either melflufen or OPD5, do you have a sense for how long it will take before you have results for such a trial?

We know that we can -- we are planning to get the first patient in at the end of the quarter, early summer. Potentially then, we all know that you don't want to start a trial exactly as vacations starts. So maybe that pushed out just after vacations rather. But we are, right now, planning to be able to do that if the company if we feel that it's the right decision to do in terms of financial resources, et cetera, under those conditions. But that is what we're planning for and believe for. How long that will take? It is a little bit tricky, and we need to come back to that.

Okay. Could you -- I mean all the problematic things really happened in Q4, and you highlighted that there will be some one-off costs in Q4. But maybe you can highlight a little bit how large and what we should expect? When you're saying that you expect to have a cash runway lasting for the full 2022, how much cash do you expect to have at the end of Q4?

I don't know, Annika, if you'd like to comment on that.

Well, to give you this answer, I'm not going to give you a number until we have come a bit further in the process. We're currently in discussion with the [ CRO ] regarding closing of clinical studies. We are also in the process of not renegotiating renewing contracts as well as closing others. So to give a more exact figure will be a little bit further into the process. So for now, we're just communicating that what we are seeing is that we'll have a sufficient cash flow to last us through 2022.

Okay. If I put it another way, what are the most -- the items that can cause most uncertainty to that forecast from your side?

Actually, to the forecast that the money, this is Jakob, will last till 2022, I would argue that there are very few major uncertainties left. With regard to the exact number, when you're asking for a projection of cash position at the end of the year, there are still potential material items that can impact that. So it's 2 different questions really. We feel that we have our arms around sufficient cash for the end of the year to take us through 2022, including them supporting the EMA filing, et cetera. But there might be -- there are significant agreements still that might impact the end-of-year cash position that are material.

Okay. Then my last question, I mean, if we -- if you would get a positive response from the European authorities on your registration for a conditional or accelerated approval in Europe, what would happen then? I mean you are scaling back your marketing and sales organization in Europe back to 0 basically. So I mean what good would it do you?

So you're absolutely right. Our original business model was to sell ourselves in the -- at least in the major territories. This obviously has gone away. We don't have that option anymore due to our financial position. So we will need to have a partner, which will either in-license or some through contractual means get rights to the European rights for melflufen and detail the product in Europe. This also goes for other territories that normally piggyback on the European application and approval. So we have a lot of business development work to do during the spring. And as you all know, this will probably be further compressed for us because of what happened with the FDA. I think they need enough proof of life and formal documentation for EMA to feel secure enough to dedicate sufficient resources to such a process. So we will have a very hectic quarter 2 if that happens next year.

[Operator Instructions] Our next question comes from the line of Suzanne van Voorthuizen from Kempen.

Just to clarify, perhaps I'm misunderstanding it, but are you actually planning to conduct the dose finding study with melflufen once there is an agreement with the FDA on the design? Is that what you aim to get the PEPAXTO back on the market in the U.S.? Or do you need to conduct a study for other reasons?

So first of all, this is a very good question because what you are asking is actually the slightly schizophrenic situation where we have withdrawn the products, but there is still agreement that there is most likely a significant benefit of this compound for myeloma patients, which is the truth. We just ended up on in the FDA's opinion just on the wrong side of some very thin lines in the sand. So it's not that they don't believe that melflufen is not helpful for patients here. The question is, what patients? And there is also then the Project Optimus. Then we have a strategic discussion as a company, do we really want to put additional resources behind melflufen given the patent runway? OPD5 is a [deuterium] analog with patent composition of [matter] on to 2039. We will come back to this very strategic topic. And the third one is actually maybe we should do both if there is a potential for a reassessment of the OCEAN data at the later date, right, and then dose finding will help us to support that. But these very big strategic topics is something for quarter 1 for us and also after more dialogue with the regulatory authorities.

Okay. Okay. Perfect. No, that's helpful. Then maybe 2 other questions. You mentioned the number of employees affected by the reorganization. Can you indicate how many employees you expect to end up for the restart of the company? And there are there a follow-up on [indiscernible].

So we have a fairly clear view internally. But since we are under negotiations with the unions, I cannot comment on that until those negotiations have landed, unfortunately. I'm sorry for that.

Okay. Okay. Understood. And then on the EU filing, can you elaborate a little bit, if I may be [indiscernible] -- what's exactly the rationale from not withdrawing that planning at this point considering all the development in the U.S.? And also you are closing the commercial unit also in Europe. Is it to enable selected patients from sort of compassionate use or something similar to that?

I mean the main aim is that we still believe that this drug is helping patients. And as Klaas mentioned -- I mean, now I got to be a little bit technical, but we have one significant interaction in this study that drives the whole result from significantly inferior to significantly superior. And the question is then how a regulatory body assess that statistical interaction. And that is, of course, with the prior stem cell transplant as we have communicated at IMW. This is not a bad result. This is a complex result and is telling about pomalidomide as about melflufen. We would not continue. I just reiterate that. We would not continue this process unless we thought there was a probability of success that is relevant. And we have been in dialogue with EMA post the OCEAN result and post the product withdrawal from the U.S. market. And we have decided to continue to support the filing in Europe.

Got it. And what are your current preliminary thinking then if the approval would be there in Q2 next year in terms of commercial rollout?

So we are just making sure that the relevant market access work is done during the spring. And as Klaas mentioned, that is primarily Germany with [ DBA ]. But the second point is don't have the financial resources to build up our own commercial footprint. So we need a partner for that, one partner or partners for the European commercialization. And obviously, that is a major work stream for management during the first half of next year. and given the situation with the FDA, as I mentioned before, it means most likely that if this process is developing in a positive way, they want, what I call, proof of life from EMA, which most likely is in conjunction with the day 180 questions in March. And then that will go into high gear to actually very short time sort of close partnerships or partnership or partnerships with commercial counterparties.

And we have one final question from Adam Carson from ABG.

Just a couple, if I could. So you said that most of the nonrecurring restructuring costs would be coming in Q4. What does that imply in terms of your cash outflow in the next quarter? Should we expect it to be higher than what we've seen this quarter? What can you say there, please?

Annika?

Well, there are going to be -- I'm not going to give you an exact number either since we're still finalizing several of the pieces that are moving. So I'll actually just come back and say when we do the math, we still come to the conclusion that we expect to have a cash runway all the way through 2022. Some of the one-off costs will, of course, be mainly in book keeping provisions, whereas others will be cash affecting. So we'll come back to you on that.

Okay. And I guess another question then on the cadence of the restructuring. So when do you expect that you will have completed the restructuring and have transitioned into this new Swedish R&D-focused biotech in terms of your cost base. Can we expect to see that new normal cost base, so to speak, in Q1 already? Or will there be a hangover into further into 2022?

There will, of course, be a little bit but very little. So we expect Q1 to more or less be a normalized quarter. But normalized will then be conditioned upon that we are actually doing 2 things at the same time. We are fulfilling all the requirements for an EMA filing and all the work associated with that. And then we are a clinical stage biotechnology company preparing to launch a Phase I/II trial with either OPD5 or melflufen or both. So we are actually doing 2 things at the same time. But that will be -- the cost base of doing those 2 things will be reflected in the Q1 numbers. That's correct.

Okay. And a question on this run rate through at least 2022 that you've said. What operational activities does that take into account for? Does it include -- does it include you guys carrying out the new clinical trial, whether that's for OPD5 or any other candidate? Or is that assuming you're progressing with the EMA and the FDA tracks? What's included in that runway basically?

So the whole support of the EMA filing and the whole preparation package for the clinical trial, we could also initiate the clinical trial. The question is much more when you initiate a clinical trial, you want to feel financially stable that you can also conclude it. So that will much more be the question for the Board and the management. The initiation costs are not that significant, and we have the organization to do it. But given that such a trial will take longer than 6 months to conduct, which is the second half and a few months into 2022 -- 2023, sorry, it's much more a growing concern question and what the financing conditions are at that point, et cetera. So it's not so much the actual cost for that trial as to make sure that there is a stable future for the company. And this is, of course, inherently linked then to the outcome of the EMA process as well as exactly how we can agree with the regulatory agencies before that. So there are a few moving pieces much more related to growing concern there rather than the actual cost for such a clinical trial in the second half, if that doesn't makes sense to you.

Okay. Yes. That's clear.

I add a little more color to your first question there. The organization said actually out load to complete all the initiatives during Q4 such that all eyes can be here into the future going into Q1, so that there's actually focused on what we're saying we're going to deliver.

Okay. And maybe one more question then on this dose-finding study. Firstly, is the expectation that this would only be a requirement in the U.S. for potential continued negotiations with the FDA? Or is it something that EMA has indicated that they're looking for as well? And then separately to that, in the last webcast, the wording seems to be a lot stronger that there would be no rationale for proceeding with a dose-finding study for melflufen given the time it would take and the remaining patent life and so on. The wording from you guys today seems to imply that there is -- that, that option is a little bit more alive than what it seemed to be a month ago or so. Is that the case? I know you guys will decide to announce it formally in Q1. But are you leaving the door open more for a potential dose-finding study of melflufen and relaunch in the U.S. than what it seemed to be a month ago when it was -- when that seemed to be not an option at all?

I apologize if the wording -- it's the same position. The base case is that this will be conducted with OPD5. We still have a small door open for melflufen and that's -- to do within that. And that was the same as last time. And if the assessment is that it sounds differently, it's -- I'm sorry, that is not meant to be. It's the same assessment where OPD5 is the base case and melflufen potentially, but probably not.

And if add...

Yes. Klaas, you go.

Yes. I think one thing to note there is that we still think that we have a good dose with this drug. And we still think that the dose adjustments that we have put in place are sufficient to provide patients with melflufen safely. So you really need to look at the EMA and FDA, you're also at 2 different entities. We're filing for melflufen in Europe with the current dosing. It's really in the U.S. the Project Optimus that has led us to basically refocus our clinical development on a potential more stricter dosing. That is not necessarily the case with the EMA where our whole file is built around the currently used dose of 40 milligrams as a starting dose in every patient with melflufen. So it's not necessary that, that also impacts the EMA process. It may sound a little bit schizophrenic, but it is really the Project Optimus that has kicked up that has now put us into this position in the U.S. But we still believe that also the 40-milligram dose to start is appropriate, and as such, that is the dose that we are pursuing with the EMA approval process.

And we have one follow-up question from Patrik Ling.

Just a clarification. The fact that you're closing the COAST trial, just so I understand it, is that due to that you need to do more dose finding on that substance? Or is it due to the indication that you're looking at?

It's for safety primarily. And the reason is that the COAST study was designed to include patients who did have stem cell transplants to look at the dose in that population. That no longer is feasible. We feel based on the OCEAN data where we think that patients who have had a stem cell transplant recently should not be included. As such, the COAST study became redundant. So that study is off the table. And it was -- the goal to actually look for dosing the stem cell transplant setting is also no longer the goal of OPD5. That would be really also in the nonablative setting.

Okay. So it's the indication rather than anything else?

Yes. And yes, our internal data suggests that having melflufen or melflufen analog in stem cell transplant patients is just not the right thing to do for patients.

Okay. Then the last question for me. I mean you said that you will have a cash runway until the end of '22 without any cash input. When you say, put it like that, is that including without any potential deal or out-licensing of melflufen solution in Europe?

Yes. So no external funding of any source whatsoever.

And as there are no further audio questions, I will hand it back to the speakers.

So thank you very much. This is one of the more difficult quarterly webcast we have conducted. It has been a tumultuous especially early Q4, of course, that was more or less the focus of this one. And please, for those that have questions, you can always reach out to our communications and IR department, and we try to respond as diligent as we can. And for financial analysts, et cetera, if you need more color please set up meetings so we can discuss in more detail what has been discussed today, and a big thank you for your continued support during these difficult times. Thank you.

This concludes our conference call. Thank you all for attending. You may now disconnect your lines.