Earnings Call Transcript - IMNN Q3 2024

Operator, Operator

Hello everyone. Good morning. My name is Malone, and I will be your operator today. At this time, I would like to welcome you to Imunon's Third Quarter 2024 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise. Following the speakers prepared remarks; there will be a question-and-answer session. I would now like to turn the call over to Kim Golodetz. Please go ahead.

Kim Golodetz, Investor Relations

Thank you and good morning everyone. This is Kim Golodetz with Alliance Advisors IR. Welcome to Imunon's third quarter 2024 financial results and business update conference call. During today's call, management will be making forward-looking statements regarding Imunon's expectations and projections about future events. In general, forward-looking statements can be identified by words, such as expects, anticipates, believes or other similar expressions. These statements are based on current expectations and are subject to a number of risks and uncertainties, including those set forth in the company's periodic filings with the Securities and Exchange Commission. No forward-looking statements can be guaranteed and actual results may differ materially from such statements. I also caution that the content of this conference call is accurate only as of the date of the live broadcast, November 7, 2024. Imunon undertakes no obligation to revise or update comments made during this call, except as required by law. With that said, I would like to turn the call over to Dr. Stacy Lindborg, Imunon's President and Chief Executive Officer. Stacy?

Stacy Lindborg, CEO

Thank you, Kim, and good morning everybody. I'd like to begin by noting that Michael Tardugno, the Executive Chairman of our Board; and Khursheed Anwer, our Chief Scientific Officer are both on the line and will be available for Q&A. David Gaiero, our Interim Chief Financial Officer will review our financial results following my remarks. Let me start with the punch line and a groundbreaking milestone for Imunon. On July 30th, we announced the results from our large randomized Phase 2 study OVATION 2, which has the potential to set a new standard in cancer research. This large randomized study involving 112 newly diagnosed patients with advanced ovarian cancer not only exceeds expectations but also marks an unprecedented achievement in oncology, with an improvement in median overall survival of 11.1 months, nearly a year compared to the standard of care, a clinically meaningful and unprecedented improvement in first-line treatment. For women who weren't administered PARP inhibitors in the Imunon arm, the median overall survival was not yet reached at data lock, indicating that more than half of the patients in the Imunon arm are still with us, with some women approaching the five-year mark since trial initiation. Importantly, for those receiving at least 20% of the planned IMNN-001 doses, survival increased by a remarkable 17 months. These outcomes are particularly significant in a patient population that has not witnessed an advancement in frontline therapy for over 25 years. More crucially, OVATION 2 is the first study ever to demonstrate an improvement in overall survival in this context. For a deeper dive and to better understand these outcomes, I encourage you to visit our ovarian cancer R&D Day presentation from September 18th, which is available on our website under the News and Investors tab and then scientific presentations. This R&D Day features insights from studies, principal investigators, esteemed thought leaders and distinguished Harvard statistics professor, and a former NIH and National Cancer Institute IL-12 researcher. Their endorsements are compelling and a testament to the significance of the OVATION 2 results. We also announced today the presentation of additional data from the OVATION 2 study at the Society for Immunotherapy of Cancer or SITC, the 39th Annual Meeting taking place in Houston, Texas. The OVATION 2 results were so compelling that they accepted our presentation as a late-breaking poster at the meeting after the deadline had passed. Results are being presented at the meeting tomorrow by Dr. Jennifer Scalici from Emory University School of Medicine. This is an exceptional opportunity to build awareness and broader awareness of IMNN-001 and our Phase 2 trial results among peers and experts in the oncology field. Drilling into the data further, we observed consistent benefits in the trial across multiple study endpoints. This includes an early treatment effect as shown by progression-free survival, chemotherapy response scores, surgical response scores, and most importantly in a sustained way through overall survival. These data are all in the intent-to-treat population of 112 patients. We expect to report support of translational data from the trial shortly. In summary, the clinically meaningful results with IMNN-001 are truly remarkable and consistent. Furthermore, the safety profile has been consistently benign and easily managed. The unmet patient need is very high. This is a terrible and difficult-to-treat cancer with more than 250,000 women diagnosed with the disease globally each year. In the U.S., there are more than 20,000 new diagnoses and about 13,000 deaths every year. OVATION 2 accomplished the desired outcome, and we know the data were sufficiently strong that our Scientific Advisory Board unequivocally recommends proceeding to a registrational Phase 3 trial with the dose studied in Phase 2. The support of the Scientific Advisory Board was unanimous and unwavering. On a commercial note, our prospective product pricing assumptions suggest a U.S. market opportunity for ovarian cancer that exceeds $1.6 billion annually, which is far greater as we consider other geographies and clearly in blockbuster territory. We've been saying all along that the Phase 2 outcome was not unexpected. OVATION 1, a Phase 1 study in the same population, demonstrated unambiguously through translational data that our TheraPlas technology works. The trial showed Imunon-driven increases in anticancer cytokine levels such as IL-12 and interferon-gamma and decreases in immunosuppressant biomarkers such as FOXP3, PD-1, PD-1L and IDO1. In fact, the breadth of translational data from this trial is more than I can highlight given our time today, and I would encourage you to explore it further through the OVATION 1 manuscript. In short, OVATION 1 provides evidence that TheraPlas works by effectively recruiting the patient's own immune system to fight cancer. OVATION 1 also provides a dose-dependent trend in clinical improvements and an acceptable Imunon safety profile with virtually no overlapping toxicity with chemotherapy treatments. For those who follow Imunon closely, you know that what makes IMNN-001 unique is the TheraPlas technology. IMNN-001 is a non-viral gene therapy that delivers IL-12 directly into the micro tumor environment, causing multiple-fold increases in interferon-gamma and other important cytokines, and furthermore producing never-before-seen overall survival data. The gene delivery at the tumor site minimizes the toxicity that others have seen with systemic IL-12 injections. Our approach has unlocked the door to new treatment frontiers with IL-12 and is generating new hope for patients with ovarian cancer. Turning to the concept of statistical significance, I want to highlight for just a moment the presentation at our R&D Day by Dr. L.J. Wei of Harvard University. Dr. Wei pioneered a statistical approach that combines information across study endpoints for a more comprehensive evaluation of our treatment. We published this method in journals such as the New England Journal of Medicine and JAMA, specifically with the methodology applied to oncology studies. If you're short on time, I suggest you prioritize Dr. Wei's presentation. He independently analyzed OVATION 2 data, combining information from two Kaplan-Meier curves, progression-free survival and overall survival, calculating the area under the curve in generating the average time lost due to both unviable events of ovarian cancer, which would be cancer progression and death. Dr. Wei's approach has also been successfully used in cardiology and other cancer studies. The end result of this analysis showed that IMNN-001 had a reduction in the area under the curve with a significant p-value of 0.0375. His analysis provided statistical evidence that the effect observed in OVATION 2 is likely to be driven by true treatment effect. His analysis gives us added confidence in the ability to replicate OVATION 2 findings in Phase III. So where are we with respect to advancing the development of IMNN-001? Interactions with the FDA are proceeding well and we have asked the agency for an end of Phase 2 meeting and we'll meet with them before the end of the month. Assuming an agreement with the agency, we remain on track to begin our Phase 3 registration trial in the first quarter of 2025 and we are carefully identifying the requisite capabilities. We expect that the Phase 3 trial will enroll approximately 500 women with advanced ovarian cancer and will evaluate IMNN-001 in a study design that's very similar to Phase 2. Included in the criteria are likely to include newly diagnosed patients of at least 18 years of age that are candidates for neoadjuvant chemotherapy with histological evidence of epithelial ovarian, fallopian tube or primary peritoneal carcinoma with Stage IIIC/IV and a performance score of zero, one or two by Eastern Cooperative Group or ECOG criteria. The primary endpoint is expected to be overall survival but of course the final protocol will be finalized with guidance from the FDA. Now to the ongoing MRD study, which is principally funded by the Breakthrough Cancer Foundation, the study is evaluating IMNN-001's potential to eliminate minimal residual disease or MRD, as determined by second-look laparoscopy. We're studying this when IMNN-001 is administered in combination with bioequivalent Avastin and neoadjuvant chemotherapy. In subjects newly diagnosed with advanced ovarian, fallopian tube or primary peritoneal cancer. MRD is prognostic for cancer recurrence and as an endpoint may determine the impact of treatment early in the disease. An update on this study was provided by the study principal investigator Dr. Arvind Dasari of MD Anderson Cancer Center at our recent ovarian cancer R&D Day. The study recently added additional clinical trial sites including Memorial Sloan Kettering Cancer Center and Johns Hopkins University. As the first few patients have now reached second-look laparoscopy, Dr. Dasari will conduct a pilot study to test circulating tumor DNA levels in plasma and peritoneal fluid following treatment using a next-generation ctDNA assay. The goal is to determine the impact of both Imunon and bioequivalent Avastin on MRD, understanding that positive MRD patients have worse outcomes. Switching topics, let's now turn to the Phase 1 proof-of-concept study for IMNN-001, which utilizes our PlaCCine platform as a seasonal COVID-19 booster vaccine. During the second quarter of 2024, we began enrolling participants in the study, which is now fully enrolled and all treatments completed. We believe the anticipated immunogenicity data along with superior handling logistics of the PlaCCine platform differentiate our vaccine, and we are on track to complete Phase I and report data before the end of the year. We have kicked off business development activities and will actively seek a partner to continue development. Recall this trial was not intended to move forward with a vaccine in COVID but instead to serve as a vehicle to efficiently demonstrate proof of concept on this platform. With more than 80 new pathogenic viruses discovered since the 1980s for the right partner, this is an exciting product that can proceed in a multitude of strategic directions. As we gear up for our Phase III trial with IMNN-001 and report top line data from IMNN-101, we've made two strategic hires to fortify our capabilities. These appointments have been meticulously considered to address critical needs at this crucial juncture for Imunon. We hired Kristin Longobardi as Senior Vice President of Strategic Operations. Kristin joins us with over two decades of exceptional experience in enhancing business processes and operations across the biotech and pharmaceutical sectors. Most recently, she served as Vice President of R&D Quality, Operations and Performance at Biogen. We expect Kristin to play a vital role in planning the conduct of the Phase III study, making sure it stays on track and on budget. In addition, we hired Susan Eylward as General Counsel and Corporate Secretary. Susan brings a depth of legal acumen to our team with a background that includes Senior Counsel at Science 37 and various other senior legal roles. Our goals include partnering some of our products, for example, IMNN-101, and as in-house legal counsel, Susan will play an important role in ensuring the soundness of any agreement we enter into, while also reducing the extraordinary legal cost burden typically incurred in the biotech industry. And now, I'd like to turn over the call to Dave Gaiero to review our financial results for the third quarter and year-to-date. Dave?

David Gaiero, Interim CFO

Thank you, Stacy. Details of Imunon's third quarter 2024 financial results are included in the press release we issued this morning and in our Form 10-Q, which we filed today before the market opened. As of September 30, 2024, Imunon had $10.3 million in cash and cash equivalents. With our continued focus on strategically managing our cash, while continuing to advance our programs, we expect our capital resources to fund operations into the third quarter of 2025. Research and development expenses were $3.3 million for the third quarter of 2024 compared with $2 million for the third quarter of 2023. The increase was driven primarily by increased clinical spend related to OVATION 2 and the PlaCCine trial. General and administrative expenses were $1.7 million in the third quarter of 2024 as compared with $1.9 million in the third quarter of 2023. Our net loss was $4.9 million or $0.34 per share for the third quarter of 2024, as compared with a net loss of $3.5 million or $0.37 per share for the third quarter of 2023. Turning briefly to financial results for the first nine months of 2024. Research and development expenses were $9.4 million for the first nine months of 2024 compared with $7.7 million for the first nine months of 2023. The increase was driven primarily by increased clinical spend related to OVATION 2 and the PlaCCine trial. General and administrative expenses were $5.6 million for the first nine months of 2024 as compared with $7.3 million for the first nine months of 2023. The decrease in G&A expenses in the first nine months of 2024 compared with the first nine months of 2023 was primarily driven by decreased employee-related expenses and decreased professional fees. Our net loss was $14.6 million or $1.39 per share for the first nine months of 2024 as compared with a net loss of $14.6 million, or $1.64 per share for the first nine months of 2023.

Stacy Lindborg, CEO

Thank you, Dave. As I mentioned during our last quarterly call, we've taken a number of steps to conserve cash and align our critical needs with available capital. The pace of Phase III will depend on several factors, including access to capital and patient recruitment. But at this point, we are targeting a regulatory readout by the end of 2029. Financing the company is necessary to achieve success. At this junction, and as Dave pointed out, our cash runway accounting for costs associated with starting the trial in Q1, extends into Q3 of 2025. We are able to raise funds from our ATM facility and would look for a more substantial raise with investors who see the value of IMNN-001 in ovarian cancer. Our seasonal COVID-19 vaccine trial is on track to read out before the end of the year, and we are actively pursuing acquisition, license or partnership for this asset to provide non-dilutive funding. Our TheraPlas technology underpins IMNN-001 and this may likely have an application to other oncology indications such as pancreatic and colon cancers. These remain interesting areas to pursue should we have the financial resources to do so. Before I open the call to your questions, I want to remind you of the power of our technology. IMNN-001 allows durable therapeutic and dose-dependent production and release of IL-12 into the tumor microenvironment. The lack of toxicity shows its advantages over other approaches to IL-12, such that the ability of IMNN-001 to achieve well-tolerated and durable dose levels of IL-12 along with other anticancer cytokines could usher in the first immuno-based gene therapy for ovarian cancer. I want to leave you with the following thoughts. We may have in our hands the first and only immunotherapy that's effective for the treatment of ovarian cancer. We've reported favorable and clinically meaningful top line results for OVATION 2 in patients with newly diagnosed ovarian cancer. We're on track to begin our pivotal OVATION 3 trial in Q1 2025 and we have internal GMP manufacturing capability in place in Huntsville, Alabama, which will allow us to produce quality product at an order of magnitude lower cost compared to an external CDMO. Ovarian cancer represents a multibillion-dollar unmet market in medical need and our product has been granted fast-track designation by FDA and orphan drug status in the US and Europe thus providing additional protected commercial runway. A second Phase 2 study in advanced ovarian cancer is underway with IMNN-001 plus Avastin evaluating MRD through second-look laparoscopy. This is largely funded by the Breakthrough Cancer Foundation and will give insights into combination treatment with Avastin, Biosimilar Avastin or bevacizumab. Our proof-of-concept study is nearing completion with the PlaCCine platform in SARS-CoV-2. And while we wait on the data, recall IMNN-101 has demonstrated a robust immune response in preclinical platform trials. Our technology offers multiple advantages over current vaccines. We believe these attributes will be attractive to potential partners. Before opening the call to questions, I'd like to ask Michael, our Executive Chairman, if he has any comments. Michael?

Michael Tardugno, Executive Chairman

I’m sorry. I don't have any questions but I do have just a short comment here. First, thanks for sharing a remarkable and very optimistic update. In this short tenure of yours at the company, we've seen the organization be laser-focused, streamline, and delivering results that by any standard of measure suggest a significant investment opportunity. I believe that we can all agree that the future of Imunon is bright and that together with our shareholders, Imunon will deliver on its mission to have a meaningful impact on patients' lives.

Operator, Operator

Thank you. Our first question comes from David Bautz from Zacks. Your line is open.

David Bautz, Analyst

Hey, good morning everyone. Stacy thanks for the overview this morning. It was very helpful. My first question is about the Phase 3 study upcoming. What percentage of advanced ovarian cancer patients are on PARP inhibitors? And are you going to try to match that percentage in the study? And I guess kind of the second part to that question would be are there any other treatments that you're going to be looking at in combination with your therapy?

Stacy Lindborg, CEO

David, great to hear from you. Thank you for the question. As you reflect on the data that we've shared even on this call about patients with PARP inhibitors, we think that the Phase 2 trial shows very similar to what we can expect in the general community. So, we saw about 40% of patients receiving PARP inhibitors in our trial. We think that could go up as high as 50% in Phase 2. The trial worked very well in terms of balance and randomization, but this is something that we are carefully thinking about from a design perspective. Women that have HR deficiency, which includes BRCA mutation, have been shown to benefit from PARP inhibitors, and that is a component that we will discuss with the FDA and plan to bring into our design so that we can ensure there is balance. It is a group that had differentiated efficacy. Right now that is the plan for treatment. Your second part to the question was are there other treatments that we're considering. We are going to have this very explicitly included in our protocol. And again, we'll discuss this with FDA and we'll get their feedback on our protocol.

David Bautz, Analyst

Okay. As far as financing the study, so you're ready to launch with the capital that you have right now. Is this going to kind of be a finance as you go? Are there thoughts to do a huge financing? How are you kind of thinking about that right now?

Stacy Lindborg, CEO

That's right. And you heard very correctly, our cash runway includes fully burdened with launching the trial, everything that's required to get the trial up and running and with a good pace of patients enrolling. And in terms of fundraising, the goal is to fund the trial in full and we want to do this with investors that are aligned with the long-term impact for patients and our strategy. We know this will take time and we're currently looking at the best and investor-friendly means to fully fund the study.

Kemp Dolliver, Analyst

Great. Good morning, and thank you for taking the questions. I'm going to have two questions. First on 101, you mentioned you've started BD activities, are you at a point where you've had their CDAs in place? Or are you still in the very early steps?

Stacy Lindborg, CEO

Yes. So, it's premature to offer in-depth comments around the partnership opportunities that we are pursuing, but as you would expect us to do, we have appropriate feelers out. We're working with some very professional people in this regard and we're awaiting our data from the proof-of-concept study and I guess one point I really want to make is that we are very intent on ensuring that any ownership deal really reflects the value of our product and the platform and we do not intend to settle for a bargain.

Kemp Dolliver, Analyst

Great. Thank you for that. And the second question relates to the Phase 3 trial and previous comments that you're expecting you'll have some interim readouts. Is that still going to be the case?

Stacy Lindborg, CEO

Yes. We've given a lot of thought, we very carefully designed the Phase III trial with seeking expertise outside the company. Part of having a thoughtful design is really looking to maximize the likelihood of success for a registration trial, assuming that it is effective, which we believe we have very strong confidence based on our data. It's also to allow a thoughtful design in Phase III where you have a fatal illness to allow early reads on data that could allow for an early submission for a subgroup and also for the overall trial. We have given a lot of thought to this. We have very sophisticated input from physicians that know this field very well, and we will be talking about these design components with the FDA. But it would very much allow us to align interim decisions for the trial that are really in the best interest of the product and patients long term but also with investors that we're talking with.

Kemp Dolliver, Analyst

Great. Are you finalizing the details, and can we say that the $50 million cost estimate you've previously provided is fairly reliable at this point?

Stacy Lindborg, CEO

Yes. We've done really thorough top-to-bottom estimates and continue to come back with what we think is a really imminently fundable trial and a number that is very attractive when you compare to other trials of this magnitude in the oncology world. So yes, we remain very confident in our estimates.

James Molloy, Analyst

Hey guys, good morning. Thank you for taking my questions. I wonder if you walk through some of your expectations coming out of the end of Phase II meeting and what would sort of be a good, bad, or equivocal meeting with the FDA? And then any thoughts that you could share with us in advance of that where you hope to expect the Phase III trial design to look like sort of enrollment timelines and potential interim cut points that we could be looking for? And then the last question would be, would you be able to characterize the partnership environment for either PlaCCin or perhaps even for IMNN-001? I imagine you're getting interest from larger pharma for that asset as well. Thanks.

Stacy Lindborg, CEO

Thank you, James, for the question. Let me see if I can take you through them. So expectations for the end of Phase II meeting, as is common in the industry, of course, we'll plan to go through our OVATION 2 data, which is really the foundation of our Phase III trial. One of the key goals is to discuss the proposal for Phase III. As I described earlier, there's been a lot of thought that's gone into our proposal that we've shared with them. We've chosen to select the definitive endpoint of our primary endpoint overall survival, and we expect that will be the endpoint of the trial. We, of course, will come out of that discussion really seeking their advice and input. The inclusion criteria that ticked through a little bit in the prepared remarks are very similar to Phase 2, and we really do look forward to a constructive conversation with them. Your second question, I guess, was related to timing. We are planning by having the end of Phase 2 this month and we intend to have the protocol pulled together by the end of the year. Everything that is between that and the first patient enrolled is expected to occur in Q1 of next year. We've done a lot of work in advance to allow for a successful activation of the study and to be able to move quickly. The last was characterizing the partnership environment. We've been very intentional not to get ahead of ourselves, given that we know the data that will come out of the 101 trial will be very important and we do not yet have that in our hands. It is a little premature to talk about the environment. We've really been engaging with people who would be key in making introductions or furthering conversations that we think will be the most fruitful for us. We share your view that these are likely to also lead to TheraPlas as well and remain open-minded to continue to think about the best investor-friendly means to propel our company forward. Thank you for your questions. As we work in providing new treatment options for women with ovarian cancer and this progresses and we seek an opportunity to partner and further the development of our vaccine platform, we remain very excited about reporting data from our ongoing clinical studies in the coming months. We look forward to keeping you apprised of our progress. Thank you for joining us today and for your interest in Imunon. Have a great day.

Operator, Operator

Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.