Aptose Biosciences Inc. (NASDAQ:APTO) Q1 2023 Earnings Call Transcript

Aptose Biosciences Inc. (NASDAQ:APTO) Q1 2023 Earnings Call Transcript May 8, 2023

Aptose Biosciences Inc. misses on earnings expectations. Reported EPS is $-0.15 EPS, expectations were $-0.12.

Operator: Good afternoon. My name is Antoine Alexander and I will be your conference operator today. I would like to welcome everyone to the Aptose Biosciences Reports Results for the First Quarter Ended March 31, 2023. At this time, all participants are in listen-only mode. After the speakers’ presentation, there will be a Q&A session. Please be advised that today’s conference is being recorded. I would now like to introduce Ms. Susan Pietropaolo. Please go ahead.

Susan Pietropaolo: Thank you, Antoine. Good afternoon and welcome to the Aptose Biosciences conference call to discuss financial and operational results for the first quarter ended March 31, 2023. Earlier today, Aptose issued a press release relating to these financial results. The news release as well as related SEC filings are accessible on Aptose’s website. Joining me on today’s call are Dr. William G. Rice, Chairman, President and CEO; Dr. Rafael Bejar, Senior Vice President and Chief Medical Officer; and Mr. Fletcher Payne, Senior Vice President and Chief Financial Officer. Before we proceed, I would like to remind everyone that certain statements made during this call will include forward-looking statements within the meaning of U.S. and Canadian Securities Laws.

Forward-looking statements reflect Aptose’s current expectations regarding future events. They are not guarantees of performance and it is possible that actual results and performance could differ materially from these stated expectations. They involve known and unknown risks, uncertainties and assumptions that may cause actual results, performance, and achievements to differ materially from those expressed. To learn more about these risks and uncertainties, please read the risk factors set forth in Aptose’s most recent annual report on Form 10-K and SEC and SEDAR filings.. All forward-looking statements made during this call speak only as of the date they’re made. Aptose undertakes no obligation to revise or update the statements to reflect events or circumstances after the date of this call, except as required by law.

I’ll now turn the call over to Dr. Rice, Chairman, President and CEO of Aptose Biosciences. Dr. Rice?

William G. Rice: Thank you, Susan. I want to welcome everyone to our call for the first quarter ended March 31, 2023. Frankly, our year-end conference call was held just over a month ago. So today we will provide you with an incremental, but important update. Plus we also are planning a corporate update around the European Hematology Association, or EHA Conference in June, hurry plan to provide additional data. Before I get into the findings with our pipeline, I’ll remind you again that we continue to tighten our belts to most efficiently invest our current cash into the essentials related to maintaining key personnel and advancing our key pharmaceutical assets. As with any biotech company in the current market, we continue to pursue strategies to finance our programs without punitive financing terms that are pervasive in many of today’s financings and we continue to pursue partnering activities that can provide strategic support to our programs and we expect to say more about these topics in the coming days.

So now let’s hit the headline for today. First, the dose escalation and dose exploration trial with tuspetinib has been completed and tuspetinib delivered clinical responses as a monotherapy over four dose levels in very difficult to treat populations of patients with relapsed or refractory AML. Second dosing with a combination of tuspetinib and venetoclax referred to as the TUS/VEN doublet is underway for relapsed or refractory AML patients and our APTIVATE expansion trial. Third, we already are seeing brisk enrollment of the tuspetinib monotherapy arm and of the TUS/VEN doublet arm in the APTIVATE expansion trial, and we already have seen early signs of clinical activity. Fourth, the superior safety profile of tuspetinib continues to be observed, including a reduced risk of myelosuppression with prolonged dosing.

Fifth, continuous dosing with the luxeptinib, yes, luxeptinib with the G3 formulation is ongoing. And finally, I’ll remind you that we have our Annual Shareholders Meeting planned for May 23rd and just a few weeks. So having delivered the headlines, now I want to provide a few details relating to our lead agent tuspetinib. This oral small molecule kinase inhibitor was licensed from Hanmi Pharmaceutical in South Korea. We took over the development range for tuspetinib in January of last year, just five quarters ago. We applaud our partners at Hanmi for creating this remarkable molecule with a unique kinase targeting pattern that continues to deliver clinical findings that inspires to view tuspetinib has potentially playing several key roles in the future treatment regimens of patients with AML and potentially other hematologic malignancies.

Tuspetinib was created as a once daily oral myeloid kinase inhibitor to treat patients with AML and we continue to be emboldened by what we’re seeing with every emerging piece of data. Our targeting all forms of FLT3, the fix kinase, JAK1, JAK2, RSK1 and 2 and the mutant forms, but not the wild-type form of KIT. Tuspetinib delivers a kind of multi-drug therapy in one tablet that can suppress multiple oncogenic pathways that typically lead to disease progression and relapse. As I mentioned on our last call, we wrapped up a successful dose escalation and dose exploration Phase 1/2 trial with tuspetinib, where we observed responses across four dose levels and across a broad range of very ill and difficult to treat AML patients that had been failed by other therapies plus Tuspetinib was remarkably well tolerated.

As a follow on to the dose escalation and dose expiration trial, we initiated the APTIVATE Phase 1/2 expansion trial during the first quarter of this year. In the APTIVATE trial relapsed to refractory AML patients are being treated with tuspetinib as a monotherapy or with tuspetinib and venetoclax as a doublet therapy. with the monotherapy arm, the APTIVATE expansion trial is designed to confirm monotherapy activity through patient enrichment of certain mutationally defined AML populations including TP53 mutant patients, FLT3 mutant patients, who have been failed by a prior FLT3 inhibitor as supported by Fast Track Designation and the clinically significant response rate to date and possibly RAS mutated patients that have emerged as sensitive to tuspetinib.

A successful monotherapy arm may provide options for accelerated approval of tuspetinib in relapsed or refractory AML. And while it’s too early to glean formal response data from the first set of patients treated with tuspetinib monotherapy on the APTIVATE trial, I can say that we already have begun to see clear anti-leukemic activity. With a combination arm, the APTIVATE expansion trial is designed to evaluate tuspetinib in combination with venetoclax. Several weeks ago, we told you that sites had begun patient enrollment on the TUS/VEN combination. I’m really pleased to announce today that the rate of accrual in this trial has been far more brisk than expected. There’s tremendous enthusiasm from investigators. And since our last call, we have dosed a number of patients in the tuspetinib Doublet combination cohort.

Here too it’s too early to draw any firm response conclusions, but thus far during the early weeks of dosing, the TUS/VEN doublet is being well tolerated and we already are observing blast reductions in patients. Investors’ confidence in this trial is due in part to the remarkable safety of the tuspetinib to date. I’m happy to confirm that during the most recent safety review held at the end of the first quarter, that unique safety profile of tuspetinib continues with no concerning trends. The importance of a good safety profile cannot be underestimated as we get questioned all the time, especially because several other AML drugs approved or in development may be limited by toxicities caused by the need for high plasma exposure levels and the excessive suppression of a single target required to illicit responses.

For example, published reports show that certain plate FLT3 inhibitors such as gilteritinib to achieve clinical responses require plasma exposure levels that cause near complete inhibition of the FLT3 target in AML cells as measured by a classic plasma inhibitory activity or PIA assay on reporter cells. Unfortunately, plasma levels of such a drug that requires complete inhibition of the target but also be expected to cause excessive inhibition of the same target in normal cells and lead the toxicities and that’s exactly what’s observed clinically. In contrast, tuspetinib employs a different strategy to simultaneously suppress a handful of oncogenic kinases that drive pathways critical for leukemogenesis. Using the same classic PIA assay, we see that the plasma from patients treated with tuspetinib can deliver near complete inhibition of FLT3 and STAT5.

However, in patients who achieve clinical responses with tuspetinib complete inhibition of a single target is not required rather clinical responses with tuspetinib can be achieved with 50% to 80% inhibition of FLT3 and the downstream STAT5 signaling. The difference is that tuspetinib can induce clinical responses by incrementally suppressing several oncogenic pathways simultaneously rather than requiring complete inhibition of any one target. Consequently, tuspetinib appears to achieve clinical responses at lower exposures thereby avoiding many of the toxicities observed with competing agents, and it’s this favorable safety pattern that differentiates tuspetinib from its competitors. I’ll also remind you that tuspetinib has shown activity in wild-type AML, which accounts for 70% of the AML population, thereby significantly extending the market potential for this drug.

And this too is a key differentiating feature of tuspetinib. We’ve said it before but tuspetinib safety profile with its broad activity make it the ideal candidate for combination therapy and frontline therapy, and that is where we’re ultimately moving towards. Dr. Bejar will speak more about our plans for tuspetinib in combination therapy in the treatment of AML in just a moment. But now just a quick mention of luxeptinib our secondary pipeline program. You’re aware that our G3 formulation of luxeptinib is being administered to AML patients at the 50 milligram dose level, which is roughly equivalent to the 900 milligram dose level of the original G1 formulation. We continue to collect PK and safety data and our plan is to escalate dosing to determine if G3 can deliver greater plasma levels pre-clinically luxeptinib is an extraordinary molecule, and so we’re giving the G3 formulation every chance to succeed.

And finally, I’ll mention our planned upcoming milestones as we march toward key catalyst for the year. First, our end of Phase 1 meeting with the U.S. FDA is scheduled during the second quarter of this year. The meeting is designed to ensure that we’re in agreement on tuspetinib clinical study parameters and next steps in the development of the tuspetinib program. Second, around the time of the EHA Congress in June, we plan to present clinical findings to include tuspetinib dose escalation and dose exploration findings in relapsed or refractory AML patients, and our preliminary findings in patients dosed with monotherapy tuspetinib and the TUS/VEN doublet and the ACTIVATE trial. Third, around the European School of Hematology or ESH Meeting in October, we plan to present maturing tuspetinib clinical dataset.

Fourth, around the 65th Annual Society of Hematology or ASH Annual Meeting and exposition in December, we plan to present an even more robust and more mature clinical dataset with tuspetinib. And fifth, during the first quarter this – fourth quarter of this year, we plan to discuss strategies for potential future monotherapy accelerated development of tuspetinib for doublet Phase 2 development of TUS/VEN, and for a pilot triplet development with TUS/VEN and a hypomethylating agent. Let me now hand it over to Dr. Rafael Bejar, our Chief Medical Officer to go into more detail about the ACTIVATE clinical trial of tuspetinib and AML and to go over the clinical plans and timelines with you. Raf?

Rafael Bejar: Thanks, Bill. First, it’s important to remind you that in dose escalation and exploration phase of our trial, Tus was able to achieve complete remissions in a very ill relapsed or refractory AML patient population while also being safe and well tolerated. We can’t drive home enough that these are incredibly difficult patients to treat with highly adverse genetic and epigenetic alterations expressed by their disease or typically third line, fourth line or beyond, having been failed by the best available approved therapies and in many cases having been failed by various investigational drugs and prior hematopoietic stem cell transplants. So let’s talk about ACTIVATE expansion trial where we have two arms, a monotherapy cohort and a combination therapy arm tuspetinib being administered with Venetoclax.

We initiated the monotherapy arm of the trial earlier in the year with rapid accrual and lots of enthusiasm from investigators. As Bill mentioned, these are patients that have a great unmet medical needs and the ability to rescue these patients may allow us a quicker path to registration. In addition, treating these patient populations will help inform our continued development path. We do have a regulatory end of Phase 1 meeting scheduled with the FDA to ensure agreement on study parameters and next steps, and we look forward to bringing them all of our efficacy and safety data to date. If that discussion takes our clinical development plans in a different direction, we will be sure to communicate that with you. This is a global trial and our clinical team now has numerous sites up and running and route to being activated across the globe.

This includes sites in the U.S., Korea, Australia, New Zealand, and Europe. And so we expect our enrollment to accelerate even further as the year goes on. In the ACTIVATE expansion trial, tuspetinib is now being tested in combination with Venetoclax. As Bill updated you since our last call, the doublet TUS/VEN drug combination arm is up and running and dosing patients with a great amount of enthusiasm from investigators. This study represents an attractive treatment option for patients and their physicians leading them to enroll earlier in the course of treatment and increasing the likelihood of achieving a meaningful clinical benefit. We expect that the doublet study will support combination registrational studies in the second line AML population and also will serve as a bridge to a triplet pilot study of a TUS/VEN hypomethylating agent in frontline AML patients, which we have planned for later this year.

I’ll also remind you tuspetinib has shown activity in wild-type AML that is FLT3 wild-type AML, which accounts for 70% of the AML population and significantly extends the market potential for this drug. And this is an important differentiating feature of tuspetinib. We’ve said it before, tuspetinib safety profile with its broad activity make it the ideal candidate for combination therapy, frontline therapy, and that’s what’s we’re ultimately working towards. The treatment paradigm for AML is quickly shifting towards doublet and triplet combination therapies. We’ve highlighted a scientific article published last year in Blood Cancer Journal by Dr. Naval Daver and his team at the MD Anderson Cancer Center. This demonstrates the success they’ve achieved with triplet therapy for AML, which includes hypomethylating agents and venetoclax in combination with the FLT3 inhibitor.

The response rates were remarkably high. Yet those triple combination therapies are challenged by additional toxicities carry into the triplet by the tyrosine kinase inhibitors and by the limitation of only treating FLT3 mutated patients.That’s where tuspetinib could really stand out. Addition of tuspetinib to the VEN HMA doublet is envisioned to create a triplet that can be applied broadly to AML patients with FLT3 mutated or unmutated status, not merely the 30% with of FLT3 mutation and can be done so without the addition of unnecessary cardiotoxicity, prolonged myelosuppression, and those other side effects often caused by competing agents. Dr. Daver is also, of course, the lead investigator on our ACTIVATE trial, and he has remarked that if tuspetinib’s emerging profile remains intact, particularly the lack of prolonged myelosuppression in responding patients, the drug could be a game changer in combination therapies.

In an independent KOL call during the first quarter, Dr. Harry Erba, Duke Cancer Institute expressed similar sentiments saying tuspetinib “may be better suited for the combinations that we hope to develop in anything we have right now”. Tuspetinib with its proven breadth of activity and superior safety profile is looking like a big pharma drug that can address the most sizable markets in AML, and we’re developing it as such. It has extensive potential in multiple subpopulations as a monotherapy for accelerated approval and relapse refractory AML as a doublet therapy for accelerated approval and second line AML for use in triplet combinations in frontline treatment naïve patients, and finally, for use in maintenance therapy settings. We mentioned in our last call that pharmaceutical companies have begun to take notice and that interest in tuspetinib is growing.

We continue to engage this productive discussions. Indeed, we expect that a global reach will be required for commercialization to realize the full value of Tuspetinib. Our team is experienced and focused on the appropriate clinical and non-clinical development needed for a drug that has such extensive commercial opportunities. In the background, we’re also conducting essential support studies we will need for an NDA. For example, we are conducting tuspetinib food effect trial in human volunteers in a 13-week chronic tox study in non-humans. Those studies have gone very well and we expect we’ll support the types of approvals we wish to pursue with Tuspetinib. In addition, we continue to make advancements towards the manufacture commercial grade API and tablets for NDA approvals.

Likewise, we continue scientific exploration of our lead assets to report such intended approvals. And finally, I want to mention, we believe the kinase targeting patient response and patient safety profiles of tuspetinib position it as a potential drug for the treatment of myelodysplastic syndromes or MDS, as well as myelofibrosis and chronic myelomonocytic leukemia. And we’re happy to explain that further if you have any questions about it at the end. Now, let’s talk about timelines. Because ACTIVATE is an open-label trial, we will report data when available at appropriate forums. As Bill mentioned, we are planning a data update around the EHA meeting in June, but because data collection verification take time and ACTIVATE has only been open for a short while, this will be an incremental update.

As we discussed in our last call, we would expect to have a much more complete data set, particularly for the monotherapy arm at the European School of Hematology meeting ESH in October. And even more data including from the TUS/VEN combination cohort to then be updated at ASH in December. We would expect our monotherapy response data in second half of the year to include a monotherapy registrational trial to begin in the fourth quarter of 2023 or the first quarter of 2024. We’re also planning to roll out a frontline pilot triplet study around the end of the year. So we have a lot to look forward to in the coming months. Our clinical team has been key in getting ACTIVATE up and running so efficiently and multiple clinical sites on board. And so I want to recognize them for their execution.

They’ve done an outstanding job preparing us for the next steps, while we still have a lot ahead of us. Now, I’d like to turn the call over to our CFO, Fletcher Payne for an update on our financial status. Fletcher?

Fletcher Payne: Thanks, Raf, and good afternoon all. Aptose continues to apply financial discipline throughout our operations. We continue to prioritize clinical activities, ensure we achieve milestones without sacrificing the quality of our programs. As I mentioned in our last call, we’ve extended our cash runway into the first quarter of 2024. Also would like to comment on the challenging financial markets. We continue to evaluate multiple approaches to finance the company while avoiding the – and minimizing some of the negative terms we’ve seen in some financings. Now let’s review the first quarter of 2023 financials. We ended the first quarter of 2023 with approximately $35.7 million in cash, cash equivalents and investment, a decrease of $11.2 million as compared to the fourth quarter of 2022.

Our increase in our burn as related to spending on the ACTIVATE study and payments of certain accrued liabilities due in the first quarter. During the quarter, the net loss was approximately $13.7 million translating into approximately $0.15 per share loss compared to $11.5 million loss for the same period in 2022, as identified in the income statement we had no revenues during the first quarter of 2022. Research and development expenses were approximately $8.8 million for the quarter compared to $7.4 million during the same quarter of 2022. Program costs for the tuspetinib for $4.8 million and for three months ended March 31, 2023 compared to $1.2 million for the three months ended March 31, 2022. The higher program cost for tuspetinib and the current represent the enrollment of patients in our ACTIVATE study and our healthy volunteer studies as well as other related expenses.

Luxeptinib program costs were approximately $1.2 million and decreased by approximately $1.5 million compared to the $2.8 million for the three months ended March 31, 2022, primarily due to lower manufacturing costs as the result of current G3 formulation requiring less API than the prior formulation, partially offset by higher clinical trial costs. G&A expenses were $5.3 million for the quarter compared to $4.1 million from the same quarter of 2022. The increase was primarily due to professional fees and non-cash stock-based compensation expenses. As of May 8, 2023, Aptose had 93,653,662 common shares outstanding. During the first quarter, we issued 46,427 shares from the ATM and raised the net proceeds of $34,000. More information can be found in our filings on Edgar and Cedar.

Now, let’s turn it back to Dr. Rice.

William G. Rice: Thank you, Fletcher. Now we’ll open the call for questions and please feel free to pose a question to any of us. Operator, if you could please introduce the questions.

Q&A Session

Operator: Our first question comes from Edward Tenthoff from Piper Sandler & Co. Please go ahead.

Edward Tenthoff: Great, thank you very much for the update. Can you guys hear me okay?

William G. Rice: Yes. Hi, Ed. We can hear you.

Edward Tenthoff: Hey, how are you, Bill? Hey. So I wanted to get a little bit into the mechanism and sort of the doublet and the triplet. Obviously, Vanessa is or venetoclax and a hypomethylating agent are standard of care. Why go doublet first and why not straight to the triplet? And is there a mechanistic rationale or just want to understand that a little bit better? Thanks.

William G. Rice: All right. So in just a second, I’ll turn it over to Dr. Bejar. But the doublet would be more directed at second line, whereas the triplet will be more directly at first line patients. And now let me turn it over, Bejar.

Edward Tenthoff: That makes sense.

William G. Rice: Dr. Bejar?

Rafael Bejar: Yes, Bill. So just add to that point, I think in order for us to go into the triplet, we do need data with the doublet, and I think the refractory population is the appropriate place to do that. I think in practice that’s what people are doing now with existing tyrosine kinase inhibitors. So it’s not really a novel concept in that regard. The triplet also has additional liabilities of maybe more challenging, more toxicity, more time spent with myelosuppression that may be harder to do in a relapse refractory population compared to a frontline population. So I think logically, it makes sense to start with the doublet, gather the data about any potential interactions or toxicity issues that we might face before going to the triplet. But I think it also represents a potential viable therapy for the relapse refractory population on its own.

Edward Tenthoff: That’s super helpful. Makes a lot of sense. Thank you.

William G. Rice: Thanks, Ed.

Operator: Our next question comes from Matthew Biegler from Oppenheimer & Co. Please go ahead.

Unidentified Analyst: Okay, great. Hey guys. Thanks. This is Matt Hagan on for Matt. Thanks for taking our questions. I’m curious if you could talk a bit about where you see the bar for activity in the second line setting with the combo. And I guess, what do you want to see from that early combo data at EHA and later in October to give you confidence that you’re on the right track there? Thanks.

William G. Rice: Yes. So Dr. Bejar, why don’t I turn that one to you?

Rafael Bejar: Sure. So really the pilot here with the doublet that we’re doing the relapse refractory population has two purposes. One is obviously to understand the activity that that doublet will have in this patient population. So we’ll be looking at that really closely. It’s also to understand the safety and whether there are any concerns or discriminating features that might be favorable for tuspetinib in the combination with venetoclax. As far as the bar required for activity, it’s going to depend on the patient population that we’re treating, different patients will have different options available to them, some of them with really poor in dismal outcomes regardless of the therapy that’s used. But if we look at preliminary studies that have looked at other tyrosine combination – tyrosine kinase inhibitors and combination with venetoclax, we see that the response research are substantially better than they would be with a single tyrosine kinase inhibitor alone.

So we hope to see that same pattern emerge for our drug accommodation with venetoclax as well.

William G. Rice: Yes. So Matt, did that answer your question? Is there anything else?

Unidentified Analyst: I does. No, that’s great. Very exciting. Yes, I was looking forward to it.

William G. Rice: Okay, thank you.

Operator: All right, thank you. Our next question comes from Li Watsek from Cantor Fitzgerald. Please go ahead.

Li Watsek: Hey, thanks for taking the questions. Maybe just a follow up on the EHA presentation. Maybe just frame the expectations a little bit for us. Understanding the data status still early, but just wondering what types of data do you hope to share from the early ACTIVATE trial?

William G. Rice: All right. Hey, Li. So I’ll start out and then talk perhaps Dr. Bejar can add to it. So first of all, we now have completed the original dose escalation and dose exploration trial. We had put additional patients on there, and so we’re – we’ll be bringing all those data together so that we can present those at EHA. In addition, as we have repeatedly said, the APTIVATE trial just got rolling, we have a number of patients dosed with both monotherapy as well as with doublet. We’ll have to see how much data we have at that time. There’ll only be a couple of months, at the most couple of months into this. Some of the patients will provide you with preliminary reads on what we do have. But again, it takes time for the patients to get on there to be able to evaluate it at the end of Cycle 1, the bone marrow evaluation, then confirmation at the end of Cycle 2 and so on. So Dr. Bejar, do you want to add to that?

Rafael Bejar: Yes. No, I want to thank you, Li, for asking that question. I think it is important to set expectations. We can certainly do an update of how rolling is going, give a sense of how many patients are in monotherapy in the doublet arm and so on. But to those points, responses take time not only to develop, but also to confirm, and we don’t want to get ahead of our skis on that. So I think that, that might just be too early at the time point to really talk about meaningful response rates in the APTIVATE study thus far. So we wouldn’t expect a lot of that data in great detail at that meeting. However, we do plan to do a more comprehensive study update once we get additional data accrued and verified closer to that October timeframe.

Li Watsek: Okay. Maybe just maybe a follow-up question. I think you mentioned that the safety profile for the doublet has been pretty good. And you’ve seen some early blast reductions. So I guess based on what you’ve seen so far, does it give you more confidence that this doublet is working, has synergy? Or is it still too early to tell?

Rafael Bejar: Yes. In order to assess the response, we need to get to the bone marrow and then confirmatory bone marrow stage. But you’re right, you can follow the patient’s peripheral circulating blast as an early metric of whether the drug is doing what you hope to be doing. And without going into too much granular detail, I’ll say that we’re seeing exactly what we would expect to see thus far. I think it’s — we’re happy with the progress we’ve seen to date as early as it happens to be.

Li Watsek: Okay, thank you.

William G. Rice: And to add one thing to that. It’s also, thus far, the safety profile has been maintained. So we’re happy toward seeing it, even though it’s very early.

Operator: All right. Thank you, Li. Our next question comes from Joseph Pantginis from H.C. Wainwright. Please go ahead.

Joseph Pantginis: Hi, guys. Good afternoon. So Bill, I was curious if — just switching to lux a little bit. If you could discuss sort of your decision trees going forward, first, for the formulation, what kind of benchmarking you might have in mind, I mean, without obviously getting confidential. And then if you hit any of these benchmarks with regard to dosing and potential efficacy, what you might be looking to do as you also look to manage cash at the company?

William G. Rice: All right. I think there is a lot in there. So first of all, with lux, the one thing I will say, we will not do anything that will undermine our lead drug, tuspetinib. So the cash — the highest priority is cash going into tuspetinib, but we are continuing to push forward the luxeptinib. And it is, again, with that G3 formulation in terms of benchmarking. Right now, we’re looking at completing a sufficient number of patients to get the safety profile of the G3 at 50 milligrams. Hopefully, we’ll be able to get that into the near future. We’ll have the CSRC review the safety of that. And then we would plan to dose up to a higher dose level. As we have mentioned previously, the 50 milligrams of the G3 gives right about the same exposure levels as the 900 milligrams of the original formulation, which is about an 18-fold difference in dosing as well as ultimately an equivalent amount of exposure there.

So hopefully, we’ll be able to demonstrate safety with the 50 milligrams of G3, then move on up to the higher dose level. We haven’t released yet what we expect that higher dose level to be. We could go anywhere from 50 on up to 100, 150, 200 milligrams. We’ll make a decision at that time based on the safety. We do hope to see a greater exposure level with the higher dosage of the G3. And likewise, this is in AML patients. We had hoped to be able to see an anti-leukemic effect in those patients also. Once we get that, if the G3 works as we hope, then we could move it back in toward not only AML patients, we could move back towards certain B-cell malignancy patients, especially certain lymphomas. And we also believe we could take the G3 then into certain inflammatory diseases into the future.

Now, we do not have the cash to pursue all the inflammatory diseases and the other disease states at this time because our cash is going into tuspetinib, but that gives you a kind of an overview of our thought process where we’re headed with…

Joseph Pantginis: No, I appreciate that. And with cash in mind if that wasn’t an issue per se is this something you would envision holding onto as long as you can while you’re working on Tus or is this something that’s – that you could see as open earlier for business development?

William G. Rice: In many ways it’s all of those. So at this point, we’re keeping it very open because we want to see how the data roll out. We want to see if there are any differentiators even in the AML patients between luxeptinib and tuspetinib. There may be different patient populations that are affected. There is the possibility in the future you might even be able to combine such agents. I’m not saying we’re headed that way, but that’s the possibility. So we’ll take a look at the data. We’ll make a decision. Do we want to hang onto it again depending on the cash or do we want to try to partner it out? We already have had interest in this molecule but we – at this point, we’re focused on collecting the data engaging with potential partners and seeing if we want to go that path.

Joseph Pantginis: Got it. Thanks, Bill.

William G. Rice: All right. Thanks, Joe.

Operator: Thank you. Our next question comes from Gregory Renza from RBC Capital Markets. Please go ahead.

Unidentified Analyst: Hi, Bill and team, it’s Anish on for Greg. Congrats on the progress this quarter, and thanks for taking my questions. Just a couple for me on Lux. How would you characterize the commercial opportunity for luxeptinib in AML and B-cell malignancies? And although early, which of the indications do you believe would hold the greatest probability of success? If there are any key data points you could point to the most efficient path forward and be of the greatest value to the growth of the company. Appreciate it, and thanks again.

William G. Rice: All right. Thanks. As far as Lux, yes, again, we’re going to assess the effect on AML. We hope that there would be a different patient population and AML that may be better represented than with tuspetinib. And that way you could show the differentiation between the two. But again, at this point, we will do not – we will not do anything to compromise the lead drug tuspetinib. So I’m not going to speak further as to what we would do at AML. We’re going to let the data drive us there. But in B-cell malignancies, in particular, the follicular lymphoma, DLBCLs, we’ve seen activity in these patients already with the original G1 formulation. So if the G1 con – G3 new formulation continues to move forward and does well, we’d like to be able to move the drug back into those indications and that could provide additional growth for the company and to the future and increase the partnerability.

And again, once if possible, we’d also like to move it into the anti-inflammatory realm. Okay. Raf, did you want to add anything to that, Dr. Bejar?

Rafael Bejar: No, I just said like, as you can probably hear in Bill’s voice, we remained really excited about luxeptinib. I remind you that besides the great team that Bill had built here at after the reason I joined the company in part was because of the preclinical data that that luxeptinib had demonstrated. It really is a remarkable molecule. So we just have to figure out how best to be able to give it to patients, and then we want to pursue the best route for it. I do agree that that lymphoid malignancies do seem to be a natural place for luxeptinib to go forward. And ultimately, I think in combination therapy could really shine there. So that, that’s what we’re thinking. But to get to that step, we really have to make sure the formulation is doing a good job and that’s where our interests are focused now.

William G. Rice: Yes. And we’re being very careful to temper what we say about it. We’ve always been excited about this molecule. As Dr. Bejar said, it is remarkable in its activity. We just need to find a way to get as much drug in as possible to find its activity in AML and especially with these lymphoid malignancies. Okay.

Unidentified Analyst: Great. Thanks so much.

William G. Rice: Thank you.

Operator: I am showing no further questions. I will now turn the call over to Dr. Rice for closing remarks.

William G. Rice: All right. Well, I want to say thank you to everyone for joining us this afternoon. So 2023 already has been a year marked with a really a steady march of progress throughout the year already promises to be an exciting year ahead for Aptose, and we look forward to keeping you updated on our progress. And I also want to reinforce what Dr. Bejar said a little bit earlier, and I too want to thank our clinical development team for their hard work and execution on getting this ACTIVATE trial up and running. We also want to thank our investigators, the patients, their families, and we also appreciate the support of all of you, our shareholders and analysts. So thank you, and have a wonderful evening.

Operator: Thank you, ladies and gentlemen. That concludes today’s conference. You may now all disconnect and have a great day.