Theriva Biologics, Inc. (TOVX) Earnings Call Transcript & Summary

Good afternoon, everyone, and good morning to our folks on the West Coast over here. For our next presentation here at the B. Riley Virtual Oncology Conference, it's my pleasure to introduce Theriva Biologics. My name is Sahil Kazmi. I'm the covering analyst here as part of the health care equity research team at B. Riley. And it's my pleasure to introduce Steve Shallcross, CEO; and Manel Cascalló, General Director. Gentlemen, please take it away.

Thank you, and thanks for joining us today to hear the Theriva Biologics story. Next slide. We will be making some forward-looking statements in today's presentation. So I'll refer you to our securities disclosures for all the appropriate information. Theriva Biologics is developing what we believe is a unique class of oncolytic viruses, specifically [indiscernible] that have been optimized for systemic administration to be used either alone or in combination with chemotherapy treatment as well as other immuno-oncology products. As you'll hear today, our lead clinical program, VCN-01 has just entered a Phase II clinical trial with standard of care chemotherapy in first-line treatment of metastatic pancreatic ductal adenocarcinoma patients. As a matter of fact, this week, we announced the dosing of the first patient in that clinical trial, and a vast majority of today's presentation will be spent on discussing that program. We also have a number of additional Phase I programs that are in process, either company-sponsored or in collaboration with a number of leading institutions around the country. These programs cover indications in retinoblastoma, head and neck cancer and colorectal cancer. We also have a discovery engine that is in the process of development that specifically uses an internally developed Albumin Shield technology, and we'll touch on that briefly today. Our stock is traded on the New York Stock Exchange American and TOVX and as of 9/30/2022, we had $50.5 million of cash on the balance sheet. And our projected runway is to get us through the first quarter of 2024, and we expect to update that guidance on our year-end call and the expectation is that we'll be able to further extend that runway. Next slide. This is our pipeline slide that highlights all of the programs that are currently in development. Again, we'll talk more specifically about the VCN-01 program as it relates to our PDAC trial. We have an ongoing Phase I in retinoblastoma in which we are continuing to enroll patients. We recently reported out data on a head and neck trial using a checkpoint inhibitor. That trial is being conducted at ICO. We expect to have further data on that trial as it relates to efficacy and survivability sometime later this year. We also announced last week, the dosing of the first patient in brain tumor study at the University of Leeds, that's very, very exciting for us because the challenge there is to demonstrate whether or not our virus will be able to cross the blood brain barrier. And we also have a trial underway at U Penn using VCN-01 in combination with the meso-T cell therapy in ovarian and also pancreatic cancer patients. You'll hear briefly today about our VCN-11 program. This is a proprietary Albumin Shield technology. And then we have a couple of legacy programs, our SYN-004 program or ribaxamase as a preventative in acute graft-versus-host disease for bone marrow transplant patients. This is an oral enzyme used in combination with beta-lactam antibiotics to treat patients post condition for neutropenic fever. In SYN-004, our oral form of intestinal alkaline phosphatase, we've developed a pretty robust data set of Phase I data, and that program is currently in the process of being licensed out. With that said, I'll turn the deck over to Manel and he'll talk more specifically about our VCN-01 program.

Okay. Thank you, Steve. So let me introduce a bit about lead product VCN-01. VCN-01, it's a oncolytic human virus, derived from adenovirus and why is so unique, this product? It contains a series of mutations that confer to more selectivity based on E2F binding and also Delta-24 mutation, but it also contains other genetic elements that confers unique properties in terms of expressing tumor degrading enzymes. But the uniqueness of this product comes also from the optimization that our scientists has been putting in this candidate. In fact this candidate has been developed for a long period of time, and that makes that the replication of this virus is extremely, extremely potent in tumor cells, whereas it's very, very selective in normal cells. And that's very important for systemic administration because you need high doses and you need a virus that reach in the tumor, it's able to amplify a lot. That's what VCN-01 is able to do, and has been systemically delivered, the virus is able to reach not only primary tumor, but also metastasis, and that's highly differential with most of other products in the oncolytic virus field that has been developed by intra-lesional or intra-tumoral administration. Wherever our product is highly selective, only replicating human tumor, and that makes the virus very safe. And when dosed systemically, we can raise the dose at very, very high levels. We are able to dose one-tenth to the 13 viral particles by a single shot without significant toxicity, which is relevant in the field because we allow targeting the tumor. And when targeting the tumor, the virus is expressing this PH20, a protein degrading hyaluronan. And this is a protein that it's part of the matrix of the tumor, the grade in these matrix favors the spreading of the virus, but also favors the entry of chemotherapy and the entry of the immune system. So the degradation of the matrix, it has a different effects and not only in our product, but also in an -- other chemotherapy. But also, the way that our scientists has designed VCN-01 makes that the expression of PH20 is associated with replication only in those cells with the virus can replicate PH20 is expressed. And that makes that we can use PH20 also as a surrogate marker of the replication of the virus. We are able to detect the levels of PH20 in the block of patients. So without any invasion in the tumor or getting biopsies of patient, we can know if the virus is actively replicating because only if it's replicating, PH20 is expressed in the tumor and is released to the blood stream. So let me put a cartoon just explain all these different mechanisms, the single product contains. So the virus can be dosed systemically, reach primary tumor from metastases. And you can see here how human tumor contrary to the more intuitive perception are constituted not only by tumor cells, but also by cancer-associated fibroblast, by stromal proteins and also other proteins. When VCN-01 arrives to the tumor, the virus replicates selectively in the tumor just in the tumor cells, and express PH20 only in tumor cells, okay? And that favors the degradation of this stromal, the anti of chemotherapy, but at the same time, replication of the virus like tumor cells, secrete neoantigens that attracts the immune system. And the immune system arrives the tumor that has been opened by the action of PH20. So the different mechanisms collaborate and cooperate to do a potent antitumor activity because the systemic delivery, because of the modification of the matrix, the recruitment of the inflammation and the immune system in the tumor site, all at the same time that the virus is replicating and killing the tumor. So we have conducted a quite extensive program with VCN-01 with more than 78 patients treated to date with this product. The majority of our -- we have more than 6, 7 clinical trials Phase I with this product. The majority of patients have been treated in our pancreatic program. We have 2 different programs, 1 by intravenous administration that it's combining our product with the standard of care, but also initially, we conducted a trial by intratumoral administration. It was a proof-of-concept trial basically to demonstrate the mechanism of action of our product in pancreatic patients, and we have seen a significant reduction of the stiffness of the tumor once we dose the virus. As indicated by Steve, we have also been conducting, and we have already finished the recruitment of a trial in head and neck, trying in patients refractory to the action of immune checkpoint inhibitor that receive our product, VCN-01, and later, they receive again immune checkpoint inhibitor. In order to demonstrate the capability of our product to resynthesize a human tumor to the action of immune checkpoint once they have failed to the previous therapy. The results are quite encouraging. We have already presented biological data in the last ESMO meeting in Paris, and we are planning to present data on survival very soon. We are also doing a trial in retinoblastoma, that it's a trial in pediatric population, treating intravitreally patients with this disease in order to avoid the enucleation of the eye with a very interesting result that has been already published. And we have also trials ongoing in collaboration with University of Leeds to brain tumor, but not internally as most people is doing, but just by systemic delivery. We try to demonstrate that after systemic delivery of VCN-01 and due to this matrix that they have the tumors in the brain, we can reach brain tumor systemically. That could be really a game changer in the way that brain tumors can be treated. We have already started the recruitment of this trial in Leeds. And we have also trial in collaboration with University of Pennsylvania with [indiscernible], just combining our product with CAR-T cells because, as you know, one of the major problems CAR-T cells right now is facing is the treatment of solid tumor. And 1 -- there's 2 main problems with solid tumors and CAR-T cells. The first is the humming of CAR-T cells to the tumor side, and the second is the entry because obviously, the human solid tumors are very difficult to go into. Our product it's replicating. It's inflaming the tumor. So it helps to the recruitment of the CAR-T cells to the tumor site, but at the same time, the product is degrading the matrix. So it also favors the entry of the CAR-T cells to the inner part of the tumor. We have also started this trial that it's an investigator-initiated trial. Obviously, as indicated by Steve, our most promising data comes from the pancreatic intravenous trial, and that's the lead indication for our Phase II program that has already been started in Spain right now. So what -- the lead indication of VCN-01 is pancreatic cancer. Why this indication? Obviously, all of you are aware of what's the clinical situation of pancreatic cancer. It's a devastating disease with the 4 leading cause of mortality associated with cancer right now, but increasing and is expected that in less than 5 years, maybe the second cause of cancer in U.S. And obviously, the median survival of patients is really low. It's lower than 1 year by far, normally between 8 and 11 months. However, why is so resistant pancreatic cancer? And the reason probably is the matrix. You can see here a picture of pancreatic cancer, you can see how hard is pancreatic cancer. It's like a wall that it's really hard to go into. And that's why this indication is especially well indicated for the treatment with VCN-01, that it's a product that targets the stroma metrics and favors the replication of the tumor. Our Phase I program in pancreatic cancer by intravenous administration was quite complex. There has 3 different arms. First, we tested the monotherapy of the virus to define the safety profile of our product alone, but we also tested the combination with gemcitabine, abraxane that is standard of care for pancreatic cancer in 2 different regimens, what we call the concomitant arm with 12 patients and also the sequential arm. So first, putting the virus and starting treating with chemotherapy 1 week later. And the reason for selecting this delay schedule is because we need the virus to work on the matrix first. And once the virus has modified the matrix then we start with the chemotherapy. So the entry of the chemotherapy is much more favored if we have the virus to work first. These hypothesis was confirmed by the data on our trial. In fact, in this sequential arm, the safety profile was very, very interesting. I mean basically, we have seen [indiscernible] in the majority of patients. And in terms of Grade III, we have seen basically a number of patients are a -- minority of patients that presented us a slight increase in transaminases that can lead to Grade 3, where it's very transient and spontaneously resolved. So normally, patients start having an increase in transaminases by Day 3, but by Day 7, they are fully recovered with any additional treatment needed, okay? So that's a very mild toxicity profile. In terms of efficacy, what we have seen is that the number of responders, if we take the data from the 12 patients seated in this arm, it's 50%. That compares quite well with the standard of care alone. That has been defined and it's well known. Normally, rate is around 23%, and we have obtained 50%. However, the interesting thing is that when you look by dose level, we treat it in this trial too, high dose levels that three-tenth to the 12, and one-tenth to the 13, that it was a recommended Phase II dose because we have not seen significant toxicity. What we observe is that the response rate in the high dose is much, much higher than in the lower dose. In fact, 5 out of 6 patients in this arm of the trial was responding. And that correlates very well with the overall survival of patients. So the overall survival of this cohort of patients was close to 21 months. That is quite significant compared to the standard of care alone, that it's around 8, 9 months, okay? And interestingly, that also dose dependent, okay? So this data was really compelling. And in fact -- obviously, that comes for a reduced number of patients, and that's why we decided to go on with our Phase II program. We expect in our Phase II program that an overall survival that more than 15 months could be really relevant. And we think that with our Phase I data, really, it's supporting for moving in our Phase II program. But because this trial has not only provided initial data on the safety and the efficacy profile, but has also demonstrated that the virus is behaving as expected. The biological samples collected from patients demonstrated that first, we have seen an increase in the levels of PH20 in the blood of patients that, of course, peaked at day 3, but up to day 28 and even in subsequent trials, we have demonstrated that the increase in PH20 levels in blood can be maintained up to 40 days after administration of a single shot, which is very relevant because I said at the beginning, we use PH20, not just a demonstration of the bioactivity of the virus, but also that the virus is actively replicating because only if the virus replicates PH20 straight in the blood stream. So this data is really interesting because it confirms a sustained replication of the virus for several weeks after administration. And the other interesting biological data collected from this trial is basically the idea that our virus is shifting the environment of the tumor, and a lot of immunological inflammatory markers are observed. We see here infiltration by CVA, upregulation of interferon genes and also PD-L1 upregulation. Probably, you have seen this picture in other oncologic virus style, but I want to emphasize here that this data has obtained by systemic delivery in hepatic metastasis, that is an extremely aggressive form of cancer because hepatic metastasis are highly, highly aggressive, okay? With all this data, we moved to a design of our virus trial, it's a Phase II trial, open-label, randomized, a Phase B trial that is going to be conducted in 25 sites in U.S. and in Europe, basically in Spain and in Germany. It's going to be for first line metastatic pancreatic carcinoma, and the regimen is going to be the sequential administration of first virus a linear chemotherapy. As you can see here, there's going to be 2 arms in parallel. The first arm designed to receive the standard of care of pancreatic cancer that is this 20-day cycle treatment of gemcitabine abraxane. And the second arm is going to receive exactly the same, but preceded 1 week by 1 administration of VCN-01, okay? And in this trial, we are going to treat also with a second dose of VCN-01 after the third cycle of treatment. Why at this point? Because we have demonstrated that after the initial raise of neutralizing antibodies against VCN-01, obviously expected after administering a virus for systemic administration after this initial peak that, of course, normally between day 8 and 15, levels of neutralizing antibodies decreased steadily, and by 3 months, the levels are quite low, which is consistent what has been observed in other applications with adenovirus. For instance, the COVID vaccine from AstraZeneca that is also based on a chimpanzee virus and the recommendation for the boost of this vaccine, it's also after 3 months. So we are planning in this trial to administer 2 doses of VCN-01. So the data we have collected in our Phase I program could be eventually enhanced by the second dose that we administer. In any case, we are going to monitor the levels of PH20 in the levels of patients, and we are going to have sustained information about if the second dose, it's worth or not. This trial is expected to recruit 92 patients, randomized one-to-one and the trial has already been started. The primary impact of this trial is going to be overall survival. We expect to exceed the 15 months that the KOLs has defined it as threshold for being a relevant trial. And obviously, we are going to include also secondary endpoints. These secondary endpoints are the progression free survival time to survival and also the response rates, that are going to be obtained in a shorter period of time. And that's very relevant because also overall survival is a relevant endpoint for regulatory authorities, the endpoint that required for approval, it takes time. However, this overall -- this secondary endpoints could be obtained in a shorter period of time, and we expect that normally after 12 months of having started the recruitment of the trial, we could get a significant flavor of it if the product is really active or not in the treatment arm. We are going to include also some exploratory endpoints. So basically, what's the differentiator of this trial? First line, with the optimized recruitment of patients, direct comparison with the standard of care. It's a randomized 1:1, repeated doses with VCN-01 with informed information if the dose is made sense or not open label would give us the opportunity to get real data and to have informed decisions very soon. We are going to do, obviously, a continuous interim analysis based on the secondary endpoints. And for your knowledge, this product has already an orphan drug designation in Europe, and we are going to -- we are submitting the orphan drug designation in U.S. based on the data. The trial has already been started in Spain, and we expect to recruit during all this 2023 year. That's basically our VCN-01 program, but our company is also developing other technologies because we have a very talented and experienced discovery team and R&D team that has developed a new generation of viruses with the discovery platform. This is one of the first technologies that they have already released at Albumin Shielding technology. That's basically a technology that introduces a modification in the capsid of the virus that prevents the interaction with neutralizing antibodies, that makes that this virus, especially suited for repeated systemic administration in multiple administration is based on a [indiscernible] that binds albumin resident in the blood of patients and covers the virus to prevent the interaction with neutralizing antibodies. And with this technology that basically contains -- it's basically a platform. We have developed the first candidate that is VCN-11 that basically contains the same characteristics of VCN-01, but with the modification of the capsid. And we are also constructing a series of different other candidates, VCN-12, 13, et cetera, that contains other payloads, especially suited for systemic administration and to maximize still more the activity of VCN-01. So basically, as a summary of our pipeline, I can say that we have a kind of a strategy for value generation. We have a first candidate VCN-01, that is right now in Phase II and has demonstrated a lot of things in the clinical setting from our extensive Phase I program with multiple potential value opportunities. We have preclinical candidate that it's VCN-11 that it's in pre-IND stage, that basically, it's like VCN-01, but adding albumin. And we have also other candidates that are in discovery stage that are even further optimizations of the virus. So it's a global strategy for value generation. Okay. That's all from my side. Maybe, Steve, you can also go into this slide about milestones.

So real briefly, and then we can take a couple of questions. This is our milestones that we've laid out for the next year well into 2024. And you could see for the second quarter, we've already achieved a couple of these milestones. We're also in the process of getting ready to set up a meeting with the FDA to get guidance on the advancement of our retinoblastoma program. In the second half of this year, we plan to hear back from the FDA on orphan drug designation for the PDAC program. We already have orphan drug designation in Europe for that program, as well as in the United States, the FDA has granted orphan drug designation for the retinoblastoma program. The initiation of that retinoblastoma will follow after the meeting with the FDA, and we're also working, as Manel has described in our discovery program and trying to select the next set of programs to advance into our toxicology studies and then ultimately into human clinical trials. In 2024, we hope to get the enrollment completed in our Phase II program by the end of the year that will give us an opportunity to also evaluate the data as it is an open-label study, and there could be some things to discuss after we evaluate those observations. We also hope to advance our VCN-12 program further into the clinic after selection. And our legacy program, our SYN-004 program, we expect to have data on the second cohort of that program, which is currently in the clinic and being dosed. With that said, we'll turn it over to some questions.

Excellent. Steve and Manel, very helpful overview of the story and a really compelling set up here as we look ahead to the next 12 months. Maybe if we could just take a step back here. I got a question that came in broadly on the oncolytic virus landscape. Obviously, we've seen a lot of developments recently where the general consensus is this is how you either turn a cold tumor hot or essentially prime the micro environment. Could you just discuss broadly how you're thinking about the landscape? And how VCN-01 is truly differentiated amongst what we're seeing from some of your peers?

Absolutely. Okay. So the idea here, obviously, VCN-01, it's virus designed for systemic administration. And that's extremely critical for boosting the immune system. I absolutely agree that we need the immune system to collaborate with our products to really contain tumors, which are really hard to treat. But VCN-01, the fact that can be systemically delivered, it's unique and makes the virus especially interesting for stimulating the immune system. We have data. We have one of the few companies that we have data in the same indication, pancreatic, by intratumoral and intravenous administration. And we have clearly seen the advantage of systemic administration to induce immune responses. And the fact that our payload is not directly an immunomodulator, but it changes the matrix. It makes different with respect to other companies. The virus itself is highly immunogenic by our product in addition to immunogenic, it's modifying the matrix, favoring the action of the immune system.

Excellent. I think that's really helpful. And with that, we are coming out of time. So I want to thank you again, both Steve and Manel, for joining us here today and telling us the Theriva Biologics story. Very much appreciate your time, gentlemen, and looking forward to following the progress.

Thank you.

Thank you.