BioLineRx Q1 2024 Earnings Call Transcript

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May 28, 2024

There are 7 speakers on the call.

Operator

Ladies and gentlemen, thank you for standing by. Welcome to the BioLineRx First Quarter 2024 Financial Results Conference Call. All participants are presently in a listen only mode. Following management's formal presentation, instructions will be given for the question and answer session. I would now like to turn over the call to John Lacey, Head of Investor Relations and Corporate Communications.

Operator

John, please go ahead.

Speaker 1

Thank you, operator. Welcome, everyone. Thank you for joining us on our Q1 2024 results conference call. Earlier today, we issued a press release, a copy of which is available in the Investor Relations section of our website. It was also filed as a 6 ks.

Speaker 1

I'd like to remind you that certain statements we make during the call will be forward looking. Because such statements deal with future events and are subject to many risks and uncertainties, actual results may differ materially from those in

Operator

the forward looking statements.

Speaker 1

For a full discussion of these risks and uncertainties, please review our annual report on Form 20F and our quarterly reports on Form 6 ks that are filed with the U. S. Securities and Exchange Commission. At this time, it is now my pleasure to turn the call over to Mr. Phil Serlin, Chief Executive Officer of BioLineRx.

Speaker 2

Thank you, John, and good morning, everyone, and thank you for joining us on today's call. Joining me today are Holli May, President of BioLineRx USA and Mali Zevi, our Chief Financial Officer. In addition, Ella Serrani, our Chief Development Officer, will be joining the call for Q and A. I will begin with a brief update on the significant progress that we are making on our FXTA launch, then turn the call over to Holli, who will go into our commercialization progress in more detail. I will then provide an update on our very promising pancreatic cancer and sickle cell disease programs.

Speaker 2

Finally, Mali will review our financial results. We will then open up the call to your questions. Let me begin with an AFFXTA commercialization update. As we've noted previously, transplant centers, the end users of AFFXTA are a well defined group in the U. S.

Speaker 2

Approximately 80 of the 212 centers in the U. S. Perform roughly 85% of all transplant procedures. In this foundational year for AFFXTA, we focused our efforts on these top centers and are making strong progress. To date, we have established formulary placement at centers that manage approximately 26% of all multiple myeloma related transplant of the Q2 and 60% by the end of this year.

Speaker 2

As a result of this work, we saw steady growth in adoption in this the first full quarter since launch. While it is very early in the launch, we are nonetheless pleased not only with the sales trajectory that we are on, but on the progress that we continue to make getting effects on more transplant center formularies and treatment protocols. Furthermore, feedback from transplant centers on the clinical benefits has been positive. They are experiencing AVEXA's value firsthand, which simply put is greater certainty, greater certainty in collection, time to collection and scheduling. This is a new era for multiple myeloma patients and transplant centers.

Speaker 2

Patients are more often older and increasingly receive quad induction therapy, which can increase mobilization risk. Additionally, transplant centers are seeing increased competition for apheresis chair time, while experiencing staffing challenges. Greater certainty is the innovation that AFFX is providing this new era and it is having a positive impact on patients as well as nursing and technical staffing. Our team is excited to be introducing a new standard of care for the mobilization of stem cells for multiple myeloma patients. Staying on the topic of stem cell mobilization, recall that last October we closed an exclusive license agreement with Gloria Biosciences for the development and commercialization of matixoportide across all indications in Asia.

Speaker 2

Gloria's IND for a small stem cell mobilization bridging study, a requirement for commercialization approval in China was recently accepted by the Center For Drug Evaluation of the National Medical Products Administration in China. We expect that this study will commence with the first patient dosed in the second half of this year. Additionally, for countries in Asia that do not require a bridging study, Gloria is making great progress. We anticipate commercialization to begin in the Vau region of China, in Singapore and in Macau over the next few quarters. We estimate that Asia had over 51,000 reported cases of multiple myeloma, the largest number of cases globally.

Speaker 2

Stem cell mobilization is therefore a significant opportunity for both companies in the region. At this point, I'd like to turn the call over to Holly May, President of BioLineRx US for a more detailed review of our early effects to commercialization progress. Holli, please go ahead.

Speaker 3

Thank you, Phil. As mentioned, this is a new era for patients with multiple myeloma planning for a stem cell transplant. Patients are receiving transplants at increased age and in the U. S. They are now often treated with quadruplet induction therapy, which leads to the highest rate of complete responses and prolonged progression free survival.

Speaker 3

These are both great achievements with strong benefits for patients. However, increased age in the combination of drugs used in quad therapy are both known to contribute to poor stem cell mobilization. As a result, the number of patients categorized as predicted poor mobilizers is increasing. This outcome is impacting in real time long held mobilization treatment paradigms at centers. This quarter, we presented 2 posters that highlighted the innovation benefits of AFFXTA on center efficiency and economics.

Speaker 3

This data, which was presented at the American Society For Apheresis Annual Meeting or ASPA and at the International Society For Pharmacoeconomics and Outcomes Research or ISPOOR is supporting decision makers at centers as they consider new mobilization strategies. Results from the analysis presented at ASPA, which assumed an institution averaging 20 transplants per month, showed that switching to G CSF plus Effexta could increase apheresis capacity by 52 patient days per month versus G CSF alone or by 12.3 patient days per month versus G CSF in combination with Clarixafor. Additionally, the analysis presented at ISPOR showed that even with Effexstaz, higher drug costs compared to other mobilization regimens, specifically G CSF alone or G CSF plus generic claricitophore, the combination of G CSF plus Effexa may confer a similar or better overall financial impact. Early adopting centers understand how this efficiency can offer a better economic outcome to them and to the healthcare system overall. They are also seeing the tangible value that Effexa is bringing to their patients and this knowledge is being shared peer to peer at other transplant centers.

Speaker 3

Like any newly launched drug in a hospital setting, where there can be a longer ramp up cycle, AFFXTA is in its foundational period. Our commercial team is making strong and steady progress with centers. And as a result, we continue to see AFFXTA added to the formularies at the top centers. And we predict continued growth. In summary, I'm very pleased with our momentum since launch and the powerful messages of innovation, efficiency and value that we are able to convey to patients, physicians and transplant center leaders.

Speaker 3

Now let me turn the call back over to Phil.

Speaker 2

Thank you, Holly. Turning now to our second development indication for matixiport mitixaportide pancreatic cancer. Our randomized Phase 2 study collaboration in first line pancreatic cancer is sponsored by Columbia University and supported equally by BioLineRx and Regeneron is actively enrolling. Data from the 11 patient pilot phase of this trial known as Qumo for MedPanc continues to show encouraging findings. We recently announced new data from an abstract accepted at this week's American Society of Clinical Oncology or ASCO's 2024 Annual Meeting.

Speaker 2

The new analysis of paired pre and on treatment biopsy samples demonstrated a significant increase in CD8 positive T cell density in tumors from all 11 patients treated with the combination of metixoportide, PD-one inhibitor samiplimab and standard of care chemotherapies gemcitabine and nab paclitaxel with a P value of less than 0.007. These biopsy sample findings continue to confirm immune cell activation and tumor microenvironment modulation initially observed in the earlier combat Phase 2a clinical trial. PD-one immunotherapies have previously shown limited to no efficacy in pancreatic cancer. We believe that matixaforgot can alter tumor resistance in pancreatic cancer and potentially other solid tumor types, helping to overcome a significant obstacle for immunotherapies, including PD-1s. In addition to the chemo for MET TANK trial, as part of our license agreement with Gloria Biosciences, we are working with them on the design of an additional randomized Phase 2b clinical trial evaluating motixoportide in combination with Glorias commercial PD-one inhibitor, zembrolizumab and standard of care combination chemotherapy in first line pancreatic cancer.

Speaker 2

That trial in China is expected to commence in the first half of twenty twenty five. In summary, we believe the combination potential of metixopore type and PD-one inhibitors in pancreatic cancer as well as over 20 other solid tumor types with high levels of CXCR4 expression could be a significant multi $1,000,000,000 opportunity. Turning now to sickle cell disease, we are also making great progress pursuing matixoportide's potential to support gene therapy for patients with sickle cell disease, which requires significant quantities of hematopoietic stem cells for genetic manipulation, manufacturing and transplant success. The most commonly used drug for collection of stem cells G CSF is contraindicated to patients with sickle cell disease and the current strategy using Clarixafor has shown limitations, including the need for multiple collection cycles to achieve the necessary hematopoietic stem cell yields. For some, gene therapy may be prohibitive by the failure to obtain adequate numbers of hematopoietic stem cell.

Speaker 2

We are actively working with leaders in the gene therapy field and look forward to the second half of this year when early data is expected from our collaboration with Washington University School of Medicine in St. Louis, which is evaluating matixoportide for the mobilization of hematopoietic stem cells in patients with sickle cell disease in the Phase 1 clinical trial. At this point, I'd now like to turn the call over to Mali, who will review our financials. Mollie, please go ahead.

Speaker 4

Thank you, Phil. As is our practice, I will only go over the most significant items in our financial statement, revenues, cost of revenues, research and development expenses, sales and marketing expenses, net loss and cash. I invite you to review the 6 ks filing we made this morning that contains our financials and press release. The revenues for the quarter ended March 31, 2024 were $6,900,000 We did not record any revenues during the Q1 of 2023. Revenues for the quarter reflect a portion of the upfront payment from the Gloria Biosciences license agreement and the milestone payment achieved under the same license agreement, which collectively amounted to $5,900,000 as well as $900,000 of net revenues from product sales of AFFXTA in the U.

Speaker 4

S. Cost of revenues for the quarter ended March 31, 2024 was $1,500,000 We did not record any cost of revenues during the Q1 of 2023. The cost of revenues for the quarter primarily reflects sub license fees on a milestone payment received under the Gloya Biosciences license agreement and royalties on net product sales of AFFXTA in the U. S. As well as amortization of intangible assets and cost of goods sold on product sales.

Speaker 4

Research and development expenses for the quarter ended March 31, 2024 were $2,500,000 as compared to $3,700,000 for the same period in 20 The decrease resulted primarily from lower expenses related to MATIC support and FDA supporting activities as well as termination of the development of AGI-one hundred and thirty four. Sales and marketing expenses for the quarter ended March 31, 2024 were $6,300,000 as compared to $3,900,000 for the same period in 2020 3. The increase resulted primarily from the ramp up of commercialization activities related to 4 was $700,000 compared to $12,200,000 for the same period in 2020 3. The net loss for the 2024 period included $4,500,000 in non cash income compared to non operating expenses of $2,900,000 for the same period in 2023, both specifically related to the revaluation of warrants. As of March 31, 2024, the company had cash, cash equivalents and short term bank deposits of $28,200,000 Subsequent to the end of the quarter, we accessed an additional $20,000,000 in non diluted debt financing under our previously announced agreement BlackRock, formerly CREF Capital.

Speaker 4

We also completed a $6,000,000 registered direct equity offering. We anticipate that this amount will be sufficient to fund operations as currently planned into 2025. And with that, I'll turn the call back over to Phil.

Speaker 2

Thank you, Molly. In closing, as is our custom, I would like to take a few moments to summarize our upcoming milestones. The first is continued commercialization ramp up of Apekstay in the U. S. Next, initiation of a bridging study by Gloria Biosciences to support approval of AVEXTA in stem cell mobilization for multiple myeloma in China.

Speaker 2

Then completion of recruitment in the Phase 1 pilot study of empatixa for gene therapies in sickle cell disease led by Washington University School of Medicine with initial data expected in the second half of this year. Also continued recruitment in the chemo for medpanc Phase 2b randomized clinical trial in first line metastatic pancreatic cancer sponsored by Columbia University and supported by BioLineRx and Regeneron. And lastly, preparation activities with Gloria Biosciences on a Phase 2b combination study evaluating matixoportide in first line pancreatic cancer. With that, we have now concluded the formal part of our presentation. Operator, we will be happy now to open the call to

Operator

questions. Thank The first question is from Joe Pantginis of H. C. Wainwright. Please go ahead.

Speaker 5

Hey, everybody. Good morning and good afternoon. Thanks for taking the questions. Very nice to hear all the early factors contributing to the potential strong launch of AFFXTA. So a couple of questions there, if you don't mind.

Speaker 5

So first, I realize obviously ahead of time there might be a lot of noise around your answers here because it's still early in the launch. But first off, Phil, you mentioned a few different things. But I guess for you and Holly, what would you say are the top 1 or 2 early factors that centers are saying are truly differentiated even if

Speaker 2

it's as simple as access to chairs quicker? Okay. First of all, Joe, good morning. It's a pleasure to hear your voice. I think this one I will turn over to Holly.

Speaker 2

Holly, can you

Speaker 6

take this?

Speaker 4

Yes. Yes. Thanks, Phil and thanks, Joe,

Speaker 3

for the question. So certainly it's the chair time. We've and I think as I spoke in my comments we had 2 very interesting posters that talk about the efficiencies that institutions can see using Kvexta plus GCSF whatever their standard mobilization regimen was. But I think the other thing and I know talked on in this forum before about the 3 legs or the 3 pillars of our value proposition. I think one of the things that is resonating with every center is the clinical benefit and that is the increased number of CD34 stem cells mobilized in a single apheresis.

Speaker 3

So the rest of the story is certainly what that means to the center, increased efficiencies, chair time, etcetera. But I think the thing that unequivocally resonates across all of the institutions that are using AVEXTA is this the number of stem cells that are being able to be harvested in a single session. Exactly what we saw in our Phase 3 data, which is very encouraging.

Operator

The next question is from John Vandermosten of Zacks. Please go ahead.

Speaker 6

Thank you. So let me go on some of the questions about just the effects of rollout. And based on your observations of the formulary committee meetings, are they bunch up around certain parts of the year, I mean, maybe the end of the year, I mean, maybe the end of the semester for academic institutions or just at the end of the quarter, when you see a lot of those come through, can you give me any color on that,

Speaker 2

Phil? Yes, sure. Hi, John. First of all, thanks for dialing in. Holly, you want to take that?

Speaker 3

Yes, sure. Thanks. Phil, thanks, John, for question. No, not really. There is no kind of phasing by quarter or by year.

Speaker 3

Most institutions have P and T committee meetings on a monthly basis. So there is a little bit of kind of stickiness on the up ramp in that we need to talk to the P and T members, get on the schedule for P and T after P and T approval, after the approval of that committee, then there are protocols that need to be in place and then order sets. So it is a little bit of a longer ramp up, but to say that these P and T meetings where these decisions are made happen at a phasing of end of a quarter, end of the year. That's not necessarily a true statement. They happen every month.

Speaker 3

And so our field teams are hard at work center by center to get them the information that they need in order to move forward with those P and T committee meetings and hopefully positive decisions.

Speaker 6

Okay. And so I guess that suggests that you'd see a steady increase in penetration as we move towards your target for the end of the year?

Speaker 2

I think that that's a correct statement. Yes, yes, John.

Speaker 6

Okay. And there are I think I calculated spot tracking that there are about 132 transplant centers that aren't in your target group. Have any of those picked up the use of FXTA? And how do you anticipate those other centers, I guess, like proliferate centers, how do you anticipate those actually picking up the product? I mean, maybe by physicians that use it in one of the primary centers kind of taking it with them or just recognizing the value.

Speaker 6

How do you see those other guys that you aren't really targeting directly using the product as we move through the quarters?

Speaker 2

Holly, did you get that?

Speaker 3

Yes, I did. So I'm happy to answer that question. So first of all, as I think we've said before, the 86% of all transplants in multiple myeloma occur in those 80 centers. So your math is pretty good there. Those the extended effort that would need to occur in order to get

Speaker 6

that additional 14% isn't necessarily efficient, especially

Speaker 3

for a small company like BioLine The other thing that we haven't necessarily talked about, The other thing that we haven't necessarily talked about is that we also are looking at those institutions that use a booster agent like Plurixafor or like Effexa. And many of those institutions that you're speaking of in that additional 14% still aren't necessarily using a boosting agent to the rate that those top 80 are. So there's many reasons why we are hyper focused on those top 80. That's not to say that eventually as we move through the process that there isn't value in that remaining those remaining institutions, but it will take a lot more effort from our field teams in order to gain those. So in the 1st year, we are very much focused on where we can make the greatest impact

Speaker 4

as quickly as we can.

Speaker 6

Okay. That's helpful. And another question on the gene therapy side again, I know I always ask for those. But Phil, you and I have talked in the past and Hollie too maybe on just how part of the goal of the current trial is going on at Washington University is to establish safety. I guess after you achieve that and the data is made available, do you anticipate that there'll be a lot of demand in gene therapy clinical trials for the use of your product?

Speaker 6

I mean, do you see that that is something that use it kind of use it themselves?

Speaker 2

Yes. So John, that's a really good question. And I can also ask perhaps Holly and Ella to chime in as well. But we are actively speaking with a number of potential collaboration partners both in the industry as well as at academic institutions. And so we certainly do believe we certainly do see in the future additional clinical trials in this area.

Speaker 2

Does that answer your question or do you want any additional information?

Speaker 6

No, that's helpful. I mean, unless you have anything else that you can elaborate on there. I do have one more on the finance, but I mean that does answer it. Didn't want to leave Molly out. I was looking at gross margin and wanted to see if there's any guidance you could give us in terms of trying to estimate that as we move through the year based on our forecast for product sales?

Speaker 2

Yes. So I mean, I think that you can see in our financial statements that gross margins are well in excess of 90% and significantly in excess of 90%. And I don't think that that's going to change. Okay.

Speaker 6

All right. Thank you for taking my questions.

Speaker 2

You're welcome. Have a great day.

Operator

The next question is from Joe Pantginis of H. C. Wainwright. Please go ahead.

Speaker 5

Hey, there. Thanks for taking the follow-up. I just wanted to ask, look, I don't want to overstate or understate, but I really wanted to get comments as to the potential importance of the work that you did ahead of time to be able to get the pass through status for CMS with regard to hospital bundling? And then second, anything that we need to consider with regard to drug supply and manufacturing efforts for additional ramp up? Thank you.

Speaker 2

Okay. So I will turn that first question over to Holly and I'll take the second question. Go ahead, Holly.

Speaker 3

I don't know if I heard the question in there, but I will attempt to answer this. And if I didn't clearly get to your concern, please ask the question again. So we are quite pleased with the work that our account team has done. We have 3 different types of field individuals. We have our sales professionals, we have our medical team and then we also have our account payer team.

Speaker 3

And they are focused on the payers, both commercial and government payers to assure that we have access. We are quite pleased where we are right now with about 95% of the lives covered. And as you said, also we are in the Q1, we have attained that pass through status. So we feel like we are well positioned and we have not to date had any issues with any sort of access or denial of patients to receive Afexxa. Now did I answer your question?

Speaker 3

I'm not exactly sure.

Speaker 5

You did, Holly. You did.

Speaker 2

Thank you. And on the supply side, Joe, we are very well positioned from a drug supply perspective, both for all of our commercial needs as well as our clinical needs. So there's really no issue there whatsoever.

Speaker 5

Great. Thanks for the follow-up. You're welcome.

Operator

There are no further questions at this time. Before I ask Mr. Phil Serlin to go ahead with his closing statement, I would like to remind participants that a replay of this call is scheduled to begin 2 hours after In the U. S, please call 1-eight eighty eight-two ninety five-two thousand six hundred and thirty four. In Israel, please call 3,9,250,000 4.

Operator

Internationally, please call 9,723-nine 255904. Mr. Serlin, would you like to make your concluding statement?

Speaker 2

Yes. Thank you, operator. In closing, we are progressing through 2024 with significant momentum, both with the ongoing commercial ramp of AFFXTA as well as the advancement of our development programs in pancreatic cancer and sickle cell disease. I am excited for what we are poised to accomplish over the remainder of this year and next. Thank you all very much for your continued interest in BioLineRx.

Speaker 2

We look forward to providing our next comprehensive quarterly update in August. Be safe and have a great day. Thank you. This concludes

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Key Takeaways

  • AFFXTA commercialization is gaining traction with formulary placement at U.S. transplant centers covering roughly 26% of multiple myeloma procedures in Q2 and an expected 60% by year-end, supported by positive feedback on improved collection certainty and apheresis capacity.
  • Under the exclusive Asia license with Gloria Biosciences, a bridging study in China for stem cell mobilization starts in H2 2024, with plans to commercialize in China, Singapore and Macau over the next few quarters to address over 51,000 annual myeloma cases in the region.
  • In pancreatic cancer, a 11-patient Phase 2 pilot showed a significant increase in tumor CD8+ T-cell density (P<0.007) when combining matixaforgot with a PD-1 inhibitor and standard chemo, and a Phase 2b trial in China is slated to begin in H1 2025.
  • For sickle cell disease gene therapy, a Phase 1 trial with Washington University is evaluating matixaforgot for hematopoietic stem cell mobilization—early data are expected in the second half of 2024 to potentially overcome current mobilization limitations.
  • Financially, Q1 revenue totaled $6.9 million (including $0.9 million in AFFXTA sales), the net loss was $7 million, and with $28.2 million in cash plus $26 million in post-quarter financing, operations are funded into 2025.
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Earnings Conference Call
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