Earnings Call Transcript - PHGE Q1 2022

Operator, Operator

Good morning, and welcome to the BiomX First Quarter 2022 Financial Results and Corporate Update Conference Call. I would now like to turn the call over to Marina Wolfson, Chief Financial Officer of BiomX. Please proceed.

Marina Wolfson, CFO

Thank you, and welcome to the BiomX First Quarter 2022 Financial Results and Corporate Update Conference Call. The news release became available just after 6:30 a.m. Eastern Time today and can be found on our website at biomx.com. A replay of this call will be available on the Investors section of our website. Before we begin, I'd like to review the safe harbor provision. All statements on this call that are not factual, historic statements may be deemed forward-looking statements. For instance, we're using forward-looking statements when we discuss on the conference call potential market opportunities, the design, aim, expected timing, interim and final results of our preclinical and clinical trials, the sufficiency of our existing cash, cash equivalents and short-term deposits, our capitalization, the potential receipt of additional cash if milestones are met, the potential benefits of our product candidates and potential growth in shareholder value. Except as required by law, we do not undertake to update forward-looking statements. The full safe harbor provision, including risks that could cause actual results to differ from these forward-looking statements, are outlined in today's press release, which, as noted earlier, is on our website. Joining me on the call this morning is Jonathan Solomon, Chief Executive Officer of BiomX. With that, I will turn the call over to Jonathan.

Jonathan Solomon, CEO

Thank you, Marina, and good morning, everyone. Having recently released our 2021 annual report, our first quarter update will have limited new information over what we reported just a few weeks ago on our fourth quarter conference. So I intend to keep the remarks brief on this call and reserve more time for the question-and-answer session. I'd like first to provide an update on BX004, which is being developed for the treatment of chronic respiratory infections in patients with cystic fibrosis or CF. At present, we are working actively to enroll patients in the Phase Ib/IIa trial. And we continue to expect initial data from the Phase Ib portion of the trial in the third quarter of 2022. As noted in our prior update, our CF program is being supported through a therapeutic development award from the Cystic Fibrosis Foundation, an organization that has been instrumental in supporting the development of so many life-saving medicines for cystic fibrosis patients. We are also very excited to announce that tomorrow, May 12, BiomX will host a KOL webinar to discuss the treatment landscape for CF patients with chronic lung infections and the potential of BX004 to address patients with chronic Pseudomonas aeruginosa infections. The first part of the event will feature prominent CF clinicians, who will review the current treatment modalities and the unmet medical need in treating cystic fibrosis patients with chronic Pseudomonas aeruginosa infections. Following the KOL presentation, BiomX will present its phage therapy, BX004, as a potential treatment solution providing a review of phage candidates' preclinical activity and an overview of the ongoing clinical development plan. Let me now briefly turn to the BX005 program, which is being adopted for the treatment of atopic dermatitis. I'm happy to report that in April 2022, the FDA cleared the IND application for atopic dermatitis candidate, BX005. BX005 has been designed to restore the skin microbiome composition of AD patients back to its pre-flare state by reducing Staphylococcus aureus burden, a bacteria associated with exacerbating inflammation in this particular skin condition. We anticipate initial data from our Phase I/II proof-of-concept trial in the fourth quarter of 2022. I'd now like to turn the call over to Marina Wolfson, our Chief Financial Officer, to cover our financial results for the first quarter.

Marina Wolfson, CFO

Thank you, Jonathan. As a reminder, the financial information is available in the press release we issued earlier today and also in more detail on our Form 10-Q, which will be filed later today. I will walk you through some of our brief highlights. As of March 31, 2022, cash balance and short-term deposits were $55.7 million compared to $63.1 million as of December 31, 2021. The decrease was primarily due to net cash used in operating activities. Research and development expenses net were $4.9 million for the 3 months ended March 31, 2022, compared to $5.7 million for the same period in 2021. The decrease was primarily due to pauses in the development of BX003, the product candidate for the treatment of inflammatory bowel disease and primary sclerosing cholangitis; pauses in the development efforts in the colorectal cancer program as well as the discontinuation of BX001, the product candidate for the treatment of acne. In addition, the decrease in R&D expenses was due to an increase in grant from the Israel Innovation Authority offset by an increase in expenses related to conducting preclinical and clinical trials of our CF and AD product candidates, BX004 and BX005 respectively. There was no material change to general and administrative expenses that impacted earnings for the 3 months ended March 31, 2022, compared to the same period in 2021. Net loss was $8.2 million for the first quarter of 2022 compared to $8.4 million for the same period in 2021. Net cash used in operating activities was $7.4 million for the 3 months ending March 31, 2022, compared to $6.4 million for the same period in 2021. We estimate that existing cash, cash equivalents and short-term deposits will be sufficient to fund the company's current operating plan through the end of 2023. Additional tranches that will become available to the company under its venture debt facility upon the satisfaction of certain specified milestones can further extend the company's cash runway through the first half of 2024. And now I'll turn the call back over to Jonathan for his closing remarks. Jonathan?

Jonathan Solomon, CEO

Thank you, Marina. With a good balance sheet and proof-of-concept data expected within the next 12 months in both our cystic fibrosis and atopic dermatitis programs, BiomX is entering an exciting period where we aim to demonstrate positive proof-of-concept data in areas of significant unmet medical need. Either one of these readouts, if positive, will represent a watershed moment for our company, clinical validation of our technology platform and the creation of significant value for our shareholders. We thank you for your continued support. And at this time, we'd like to open up the call for questions. Operator?

Operator, Operator

Our first question comes from Kristen Kluska with Cantor Fitzgerald.

Kristen Kluska, Analyst

So we've seen AMR actually deploy more funds recently to the state. So big picture, could you talk about the potential for seeking some non-dilutive funds in the future from some of these initiatives in addition to what you already have in place with, for example, CFF? And when do you think pharma in this space is going to put a larger emphasis on AMR and the problems that we're seeing in general?

Jonathan Solomon, CEO

Kristen, that's a great question, and it's nice to see some good weather in New York. What we're observing is just the start of something promising. The investment from AMR in APT is a positive development, and we are maintaining close communication with AMR. APT has been involved in some compassionate use cases that help build confidence in phage therapy. Additionally, the BioNTech deal with PhagoMed highlights the growing interest in bacterial vaginosis and licensed technologies, indicating increasing interest in this field. BARDA has also invested significantly in contracts like the one with Vedanta, focused on bacteremia in the microbiome space, which adds to this momentum. However, what the pharmaceutical industry needs to see is a proof-of-concept study. There is already a lot of anecdotal evidence showing promise with phage technology. For example, we have at least 11 patients published in cystic fibrosis that demonstrated a significant impact. Pharma will likely progress further once they can see a proof-of-concept from a randomized controlled study that shows a significant reduction in target bacteria along with some clinical benefits. With BiomX, we aim to achieve this within the next year.

Kristen Kluska, Analyst

Could you update us on the efforts you are making to potentially target pediatric patients with phage therapy? Additionally, many of the compassionate use studies we've observed have mostly involved adolescents and adults. What key differences, if any, do you anticipate with this age group and the use of phage therapy?

Jonathan Solomon, CEO

I think you're correct. For us, the pediatric aspect will be interesting in areas like atopic dermatitis due to the safety profile. However, it's not our initial focus in cystic fibrosis, which includes both pediatric and adult populations. We will initially start with adults in atopic dermatitis and focus on mild to moderate cases based on the research from UCSD. Given the phage safety profile, the pediatric population is certainly one we want to target. After that, the surveys and key opinion leaders we've consulted have shown considerable interest in finding safe and topical approaches for conditions like atopic dermatitis.

Operator, Operator

Our next question comes from Fontana Blackrock with Ladenburg Thalmann.

Unknown Analyst, Analyst

I'm Fontana on behalf of Michael. We have 2 questions. So the first is, are you pursuing any partnerships for 004 and 005 outside of the one that you already have in Japan?

Jonathan Solomon, CEO

I think it goes back to what Kristen mentioned. There are some discussions with a few potential pharmaceutical partners. We're very excited to have Maruho engage early in a partnership. I believe that more significant partnerships will materialize once we have the POC data. There's already been early investment in the company from J&J and Takeda. Now it's time to demonstrate some POC data.

Unknown Analyst, Analyst

All right. And the second question is so for 004, there was a bit of a delay, like the enrollment was slow. How's that going now?

Jonathan Solomon, CEO

So about a month ago, we announced a delay in the CF program due to a slowdown in site activity related to the Omicron surge. However, things are looking positive now, and we remain cautiously optimistic. We're sticking to the same guidance and are actively working to engage additional sites, which have been well-received by patients. Overall, there's a sense of cautious optimism within the team that we will keep to our timeline and deliver the data.

Unknown Analyst, Analyst

Okay. That's great. And just one last question. With 005, when does the enrollment start? And are you expecting any kind of, I guess, COVID-related effects on this trial as well?

Jonathan Solomon, CEO

It's a very good question. I think we haven't disclosed any additional detail beyond the fact that the IND was cleared, which is great news for us. Since this is a topical administration population, which is not very compromised, you don't expect any delays. And we're keeping the guidance that we originally gave on data at the end of this year.

Operator, Operator

And we have reached the end of the question-and-answer session. And I'll now turn the call back over to Jonathan Solomon for closing remarks.

Jonathan Solomon, CEO

So thank you all again for joining us this morning. We look forward to providing you with future updates on our clinical programs throughout the next year. Have a wonderful day, and please reach out to us if you have any questions. Thank you.

Operator, Operator

And this concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.