PDS Biotechnology Corporation (NASDAQ:PDSB) Q3 2023 Earnings Call Transcript

PDS Biotechnology Corporation (NASDAQ:PDSB) Q3 2023 Earnings Call Transcript November 14, 2023

Operator: Greetings and welcome to the PDS Biotechnology Third Quarter 2023 Earnings Call and Webcast. At this time, all participants are in a listen-only mode. [Operator Instructions]. As a reminder, this conference is being recorded. I’d now like to turn the conference over to your host, Nicole Jones, Investor Relations for PDS Biotechnology. Thank you. You may begin.

Nicole Jones: Good morning and welcome to PDS Biotechnology’s third quarter 2023 earnings conference call and webcast. On the call from the company are Dr. Frank Bedu-Addo, Chief Executive Officer; Matt Hill, Chief Financial Officer, and Dr. Lauren V. Wood, Chief Medical Officer. Earlier this morning, PDS Biotech issued a press release announcing financial results for the quarter ended September 30, 2023. We encourage everyone to read the press release as well as PDS Biotech’s report on Form 10-Q, which will be filed with the SEC shortly. The company’s press release is available on the PDS website at pdsbiotech.com. In addition, this conference call is being webcast and will be archived on the company website for future reference.

Before we begin, we need to remind everyone that on today’s call, the company will be making forward-looking statements regarding regulatory and clinical candidate development plans, as well as research activities. Certain information in this presentation may include forward-looking statements, including within the meaning of Section 21(e) of the United States Securities Exchange Act of 1934, as amended, and Section 27(a) of the United States Securities Act of 1933, as amended, concerning PDS Biotechnology Corporation and other matters. These statements may discuss goals, intentions, and expectations as to future plans, trends, events, results of operations or financial condition, or otherwise based on the current beliefs of the company’s management, as well as assumptions made by and information currently available to management.

These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted. A description of these risks can be found in PDS Biotech’s most recent filings with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this conference call. Except to the extent required by applicable law or regulation, PDS Biotech undertakes no obligation to update the forward-looking statements included today to reflect subsequent events or circumstances. I’ll now hand the call over to Dr. Frank Bedu-Addo. Frank?

Frank Bedu-Addo : Thank you, Nicole, and welcome to everyone to our third quarter 2023 conference call. We are excited about the strides we are making, fueled by our commitment to developing groundbreaking therapies that revolutionized cancer treatments based on our proprietary reverse immune platform. And IL 12 fused antibody-drug conjugate PDS01ADC, formerly known as PDS0301 or M9241. The clinical data stemming from the PDS01ADC asset, which we acquired nearly a year ago from Merck KGaA Darmstadt, Germany, continues to advance and mature, reinforcing our belief that this innovative ADC could potentially address the safety and efficacy limitations that have been observed with cytokine therapy to date. The combination of adverse immune-based approaches and our IL 12 ADC has demonstrated the potential to overcome the limitations of effectively treating advanced cancer and extending patients’ lives with immunotherapy.

Currently, we have safety data for over 250 patients who have been treated with PDS01ADC, supporting the early data, suggesting that this innovative ADC effectively directs the IL 12 into the tumor, therefore reducing its presence in the circulating blood and subsequently limiting the adverse events that have been reported with other Cytokines. In addition, the increased and sustained presence of IL 12 in the tumor has been shown in our ongoing trials to enhance the clinical activity. This novel modification of IL 12 therefore presents us with a unique opportunity to address a broad range of cancers. We continue to move this ADC forward with various promising approaches. It is being developed as a monotherapy. It’s also being developed in combination with Versamune-based approaches and also in combination with other standards of care.

I will talk more about these updates on PDS01ADC later on the call. We are pleased with our current progress driven by our mission to develop groundbreaking therapies that transform cancer treatment. Our immediate objective revolves around progressing our primary clinical candidate, PDS0101 to the market. PDS0101 represents a novel investigational HPV16 targeted immunotherapy that triggers a potent and precise T-cell response against HPV16 positive cancers. This quarter, we made significant progress on our adverse immune platform. Specifically, with our Phase II VERSATILE-002 trial. We hosted a positive key opinion leader or KOL event that included key opinion leaders who have been part of the VERSATILE-002 trial and others who have not been part of the trial and are leaders in the head and neck cancer field.

It was important to understand how head and neck cancer expert oncologist view the trial results and the potential for PDS0101 in KEYTRUDA to become the standard of care for recurrent or metastatic head and neck cancer. Overall, the experts were enthusiastic about the updated VERSATILE-002 data and the planned initiation of the Phase III VERSATILE-003 trial. At this event, we presented data from both the immune checkpoint inhibitor naive or ICI naive, and the ICI resistance patient cohorts, both of which demonstrated impressive patient overall survival. For today’s discussion on the VERSATILE-002 trial, we will focus on the ICI naive group. With this population. We reported a 24-month overall survival rate of 74%, which means that on the combination of PDS0101 in KEYTRUDA, the probability that a patient will live at least two years is 74%.

To put this number into perspective, published 24 months overall survival rates for approved ICIs is less than 30%, meaning that, on today’s approved therapies, the probability that the patient will live for at least two years is only about 30%. The VERSATILE-002 data suggests that patients are living longer when treated with the PDS0101 plus KEYTRUDA combination. It is important to note that disease control, which includes stable disease and tumor shrinkage was seen in 81% of patients. Tumor Shrinkage was reported in 60% of patients, and a confirmed objective response rate or ORR of 27% was reported based on investigator assessment. With respect to safety, the combination continues to be well tolerated with 13% of patients having Grade 3 treatment-related toxicities and no patients having any Grade 4 or Grade 5 treatment-related events.

To put this in context, in KEYNOTE-048, it is reported that 17% of patients on KEYTRUDA monotherapy experience Grade 3 to Grade 5 treatment-related toxicities, and 72% of patients on KEYTRUDA plus chemotherapy experience Grade 3 to Grade 5 treatment-related toxicities. With this data, we believe that we are on track to revolutionize the treatment of head and neck cancer with improved clinical outcomes and better tolerability. Furthermore, in October 2023, preliminary biomarker data from the VERSATILE 002 trial was presented at the European Society for Medical Oncology or ESMO Congress 2023. The combination of PDS0101 in KEYTRUDA appears to be promoting a predominant TH1 immunologic profile that is associated with enhanced CD8 killer T-cell induction and activity.

The combination also led to subsequent decreases in the population of CD8 killer T-cells in the circulating blood. We are encouraged that these observations align with other Phase II studies reporting that PDS0101 induced poly functional CD8 killer T-cells do not reside in the blood, but rather traffic to tumors. These data support the two-year 74% overall survival rate reported in VERSATILE 002. Beyond the VERSATILE 002 trial, our focus has remained on steadily advance in preparations for our Phase III VERSATILE 003 trial. In October, 2023, we announced feedback from the FDA regarding the amended investigational new drug application, and thereafter feedback on the final clinical trial protocol. We currently have up to 60 sites selected globally and are going through the qualifying process.

As anticipated, the FDA reviewed Phase III clinical trial design has been pivotal to our business development discussions, which has yielded positive insights from prospective partners. Our clinical and medical teams are assessing final details of the trial, and therefore we anticipate VERSATILE 003 will now start in the first quarter of 2024. We’ll keep you updated on our next steps as we progress toward trial initiation. Now, turning to IMMUNOCERV, in October, 2023, data from the Phase II clinical trial were featured in an oral presentation of the American Society for Radiation Oncology Annual Meeting known as ASTRO. These data demonstrated that PDS0101 in combination with standard-of-care chemoradiotherapy was associated with a rapid decline in HPV positive circulating tumor DNA.

At five weeks of treatment, ctDNA clearance of 92% was reported with PDS0101, whereas 53% clearance was observed in patients receiving standard-of-care chemoradiotherapy alone. These biomarker data support the 100% response rate in patients receiving PDS0101 and standard of care, which was reported at SITC 2022. As this trial continues to — as PDS010ADC. PDS010ADC is a novel ADC or antibody-drug conjugate that enhances the proliferation, potency, and longevity of T-cell and IL 12 in the tumor. Let’s begin by discussing the compelling updated data from the National Cancer Institute LED triple combination trial that was reported on November 9th. This study is a Phase II trial of PDS0101, PDS01ADC, and uninvestigational ICI. This combination has undergone evaluation across multiple HPV positive cancers, encompassing anal, cervical, head and neck, vaginal, and vulva cancers in two groups of advanced cancer patients.

The ICI naive group constituted patients unresponsive to standard of care treatments that have not yet received ICI therapy. The ICI resistant group included individuals who had shown no response to multiple prior treatments, including ICI therapy. Regarding the ICI naive group, the chart shows the confirmed objective responses reported in VERSATILE-002 and the triple combination based on investigator assessment, both shown in green as well as published KEYNOTE-048 data. Notable is the objective response rate of 75% with the triple combination, and 27% with the dual combination. With KEYTRUDA monotherapy and KEYTRUDA plus chemotherapy, the published objective response rates were 19% and 36% respectively. The next figure contains updated survival data from VERSATILE-002 and the triple combination trial in green, as well as published data from KEYNOTE-048.

What is notable here is the fact that despite the lower objective response rate with PDS0101 plus KEYTRUDA, the survival benefit seen with PDS0101 plus KEYTRUDA combination as well as the triple combination appears to be similar with 24 months survival rates up 74% and 75% respectively. The triple combination also shows a compelling three-year survival of 75%. These data suggest that PDS0101 may play a significant role in extended survival in the ICI naive population, independent of objective response rate, while PDS01ADC appears to promote strong objective responses in this population. The median overall survival has not yet been reached in either the VERSATILE-002 or the triple combination studies. To contextualize published data on standard-of-care immune checkpoint inhibitors or ICIs, report that at 12 months, only 30% to 50% of these patients would typically be expected to remain alive, and less than 30% of the patients could be expected to remain alive at 24 months.

Therefore, survival associated with the PDS0101 combination rate at two years for VERSATILE-002 and three years for the triple combinations is notable. Now looking at the ICI resistant group where there’s a significant unmet medical need and no FDA-approved product. These are the patients who have failed all treatment options, including ICIs. In these ICI resistant patients with HPV positive cancers, the reported median overall survival is only about three to four months. In the ICI resistant patients, this slide shows that the published objective response rate with systemic therapies, including high-dose chemotherapy is 42%. The objective response rate was 0% with PDS0101 plus KEYTRUDA in VERSATILE-002, 5% in patients who received PDS0101 with low doses of PDS01ADC and ICI therapy, and 63% in patients who received PDS0101 with initial high doses of PDSS01ADC and ICI therapy.

Again, these data appear to demonstrate the role of PDS01ADC in promoting strong and compelling objective response rates even in late stage ICI resistant cancer patients. Let’s now take a look at the overall survival rate in ICI resistant patients. On this slide, we will see that the irrespective of objective response rate, the PDS0101 containing therapies shown by the green bars provide durable survival results. Despite the lack of confirmed objective responses with PDS0101 plus KEYTRUDA, the 12-month overall survival rate was 56% for VERSATILE-002 and 72% in the triple combination. With systemic therapies, the published 12-month overall survival rate is 36%. This data provides compelling evidence regarding the role of PDS0101 in the survival of ICI naive and ICI refractory HPV16 positive patients, and the potential role of PDS01ADC in further extending survival and also, promoting objective responses in this population.

This study provides compelling evidence that supports the potential synergy between our adverse immune-based targeted T-cell immunotherapies and our IL 12 fused antibody drug conjugate that provides the sustained presence of IL 12 in the tumor, thus providing further expansion and activation of the Versamune-induced multifunctional killer T-cells within the patient’s tumor. We believe that this data supports broader application of this combination beyond HPV positive cancer and provides a unique potential to effectively address multiple advanced. As a reminder, a safety update for this trial was announced in late December, 2022 in 50 patients. 48% of patients experienced Grade 3 treatment-related adverse events or AEs, and 4% of patients experienced Grade 4-related adverse events.

To put the safety profile in context, in the keynote 048 study. It is reported that the combination of KEYTRUDA and chemotherapy resulted in 72% of patients having Grade 3 through Grade 5 treatment-related adverse events. We are therefore pleased with a tolerability profile that is emerging for PDS01ADC, even when administered in combination with other oncology agents. As I mentioned earlier, to date, we have safety data from over 250 patients dosed with PDS01ADC. This provides further evidence that this novel modification of IL-12 may be effective in mitigating previously observed cytokine side effects while promoting improved clinical benefit and further justifies its continued development by PDS Biotech. PDS01ADC is also being studied independently of reverse immune immunotherapies.

The National Cancer Institute recently presented data for the ongoing Phase II clinical trial of PDS01ADC in combination with docetaxel chemotherapy in advanced metastatic castration-sensitive and castration-resistant prostate cancer patients at the Cytokines 2023 annual meeting. This trial is the first clinical study of an immune cytokine with docetaxel in prostate cancer. The study is investigating the safety, immune responses, and preliminary clinical activity of the combination in advanced prostate cancer patients. The trial evaluated three doses of PDS01ADC in combination with docetaxel and showed that the combination was well tolerated at all tested doses with less than 10% of patients having a Grade 4 toxicity. Most importantly, over 60% of patients had a prostate specific antigen for PSA level reduction of greater than 60%, with some patients having a 90 to 100 PSA reduction.

As shown, reduced PSA levels were documented in all 18 patients. PDS01ADC activates T-cells, natural killer cells, and natural killer T-cells while reducing the presence of immune suppressive regulatory T-cell. As a result, we believe that we now also have an opportunity to apply PDS01ADC for advanced and difficult to treat tumors by combining PDS01ADC with standard of care chemotherapy and radiation therapy. PDS01ADC is also being investigated by the National Cancer Institute in a Phase I two study in patients with intermediate and high-risk locally advanced prostate cancer in combination with radiation therapy. As mentioned previously, PDS01ADC is also being studied as a monotherapy by the National Cancer Institute in an ongoing Phase II clinical trial in Kaposi Sarcoma.

At PDS Biotech, we are highly optimistic about the potential of these novel PDS01ADC assets in cancer therapy. Switching now to preclinical development studies. The National Cancer Institute has developed a second novel approach to treating immune checkpoint inhibitor-resistant cancers by using verse immune-based immunotherapy and PDS01ADC in combination with histone deacetylase or HDAC inhibitors, another oncology standard of care. The preclinical data were presented during the recently concluded 2023 annual meeting of the Society for Immunotherapy of Cancer or SITC. In this preclinical study, superior anti-tumor activity was observed in ICI resistant tumor models with adverse immune-based immunotherapy, PDS01ADC, and acetylase, a Class 1 HDAC inhibitor.

This novel triple combination proof of concept study is under consideration as a potential approach for initial clinical studies of PDS0103 to treat Mach one specific cancers. We are encouraged by the potential of this combination. The National Cancer Institute will lead this clinical trial under our established co-operative Research and Development agreement, and we anticipate that it’ll begin in the first half of 2024. TDS Biotech has had a fruitful quarter and we are preparing to finish out the year strong as we move into 2024. To summarize, we hosted AK successful KOL event where we announced positive updated overall survival and safety data from the VERSATILE-002 trial and gained important insights from head and neck oncology leaders about the potential of PDS0101 in the treatment of HPV Positive head and neck cancer.

Preliminary biomarker data presented at ESMO from the VERSATILE-002 trial supports the reported overall survival results. The biomarker data from the IMMUNOCERV trial presented at demonstrates the role of PDS0101 in eliminating circulating tumor HPV DNA. The updated triple combination data demonstrates the role of PDS01ADC in promoting durable overall survival and objective responses even in difficult-to-treat ICI resistance patients. Data from the PDS01ADC and docetaxel trial presented at Cytokines, demonstrated tolerability of the combination and encouraging PSA biomarker results and immune responses. With that, I’d now like to turn the call over to Matt to discuss the financial summary. Matt?

Matthew Hill : Now turning to our financial results for the three months ended September 30th, 2023. Net loss for the period was approximately $10.8 million or $0.35 per basic and deleted share compared to a net loss of approximately $7.4 million or $0.26 per basic and diluted share for the three months ended September 30th, 2022. The higher net loss this quarter was primarily due to cost incurred in connection with our research and development and clinical programs. Research and development costs, which includes clinical and manufacturing expenses for the quarter ended September 30th, 2023 increased to approximately $6.4 million compared to $4.3 million for the same period of 2022. The increase of $2 million is primarily attributable to an increase of $1.3 million in clinical trial costs and $0.7 million in personnel costs, which includes $0.3 million in non-cash stock-based compensation.

General and administrative expenses for the second quarter of 2023 increased to approximately $4.1 million compared to $2.9 million for the same period of 2022. The increase of $1.2 million is primarily attributable to an increase of $0.7 million in personal costs, including $0.5 million in non-cash stock base compensation and $0.5 million investor relations costs. Our cash and cash equivalent as of September 30th, 2023 totaled approximately $54.3 million. We continue to be prudent with our cash expenditures and we believe that with initiating the VERSATILE-003 Phase III clinical trial in the first quarter of 2024. Our available cash resources will sustain our operational and research and development endeavors into the third quarter of 2024.

We expect to execute our current operational and research and development endeavors by obtaining additional capital, principally through running into collaborations, strategic alliances or license agreements with third parties and or public or private debt and or equity financing. We’ve had and continue to provide what we believe to be favorable development milestones to the market and have upcoming development milestones we believe may provide additional Catalysts to investors. At this time, this completes my financial discussion. I would like to hand the call back over to the operator for the Q&A session. Operator?

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Q&A Session

Operator: [Operator Instructions]. Our first question comes from the line of Louise Chen with Cantor Fitzgerald. Please proceed with your question.

Louise Chen : Hi, congratulations on all the progress this quarter, and thank you for taking my questions. So, I had a few questions for you. As you think about 2024, and we table set for next year, what are the key milestones, catalyst readouts that you think we should have on our radar? Secondly, how do you think about OPEX for fourth quarter ‘23 and 2024 in light of the fact that you’re going to start this VERSATILE-003 Phase III? And the last question is, when do you think we’ll see data on VERSATILE-003? Thank you.

Frank Bedu-Addo : Thank you, Louis. Thank you very much for your questions. I’ll answer two, and I’ll hand over the OPEX to Matt. But in terms of the key milestones and Catalysts, as we move into 2024, as I mentioned, key will be getting VERSATILE-003 up and running. We also have announced and stated that we do anticipate and expect the final data readouts from VERSATILE-002 sometime in the second quarter of 2024. As I also just mentioned, we do expect to initiate the PDS0103 clinical trial in Mach 1-related cancers early in 2024, at least in the first half of 2024. We also are hopeful that we will have the preliminary data from our neoadjuvant trial ongoing at the Mayo Clinic in early-stage oral cancer HPV positive oral cancer, where we are looking at PDS0101 both as a monotherapy and also in combination with KEYTRUDA.

We have not had any readouts from that study yet, and we are hopeful that we will get that in some time the first half of 2024 based upon what we’ve been informed by the PI and their goal of presenting at an upcoming conference. And also, we do expect to have additional data readouts on the immunotherapy cervical cancer trial. And so, we do have a number of potential milestones coming up as well as readouts for, and as you know, we don’t talk too much about the trials going on. Also, at the National Cancer Institute, we had the readout from the docetaxel as well as the PDS01ADC. We also have those studies ongoing in earlier stage prostate cancer locally advanced prostate cancer. We’d hopeful that we’ll see some data from that trial in 2024.

We have the monotherapy trial going to Kaposi Sarcoma. Hopefully, we’ll see some data from that trial in 2024. And so, I think we will have hopefully a pretty busy 2024 and hopefully, we’ll be able to provide quite a number of data readouts as we go through the year. In terms of the VERSATILE-003 trial, then we’ll have much more clarity on when we’ll have the data readouts. As you know, when we will be able to provide the data readout, we’ll be at our first interim data readout. Now, when we get to the first interim data readout, depends on the number of sites that we have open at the start, as well as the enrollment rates that we will encounter or that we’ll be able to achieve as the trial goes initiates, and progresses. What we are currently doing, as I mentioned, we have 60 sites that have been identified so far.

The goal is to get to a hundred sites, and what we are trying to understand now is how rapidly each site will come on board. And as we understand better how we will open the sites, and the sequence of open the sites, and how many sites will be open at any particular time, we will then able to provide much more confident in the timelines. We’ll be able to provide you as to when we will get to that interim data readout, but we are working aggressively on that now and hopefully should be able to provide that information very soon. Matt, I’ll hand over to you for the operating costs.

Matthew Hill : Thank you, Frank. I want to let you know that it’s a good question. I would say, we’ve been extremely prudent with the use of the company’s cash and capital. When you look over the last probably seven quarters or so, we burned about little north at $6 million per quarter. And with the significant number of studies that we have ongoing, not only the VERSATILE-002 trial, but also the trials with the NCI, the Its, with MD Anderson as well as Mayo. We’ve been extremely frugal in our opinion, in how we manage these costs. But as we prepare to move forward into Phase III clinical trial, obviously those costs are going to increase. Now, from the perspective of OpEx, the administrative costs will grow slightly, but we could expect that the company will incur costs in R&D of somewhere around overall costs — I’m sorry, will be somewhere around between $12 million to $15 million once the study starts up with some of that being front-loaded for the normal deposits that are need to be made to get the consultant CROs and the likes set up, which is why we — under the current circumstances of us looking at a trial beginning in Q1, we’ve got cash into Q3 of ‘24, which also gives us additional time to go out and look for the business development deals.

We had the — data come out, we’ve had the versus the NCI triple data come out. We’ve had the docetaxel data come out, we’ve had the KOL meeting, so there has been a significant number of data readouts and we’re hopeful that will be a catalyst for potential business development deals as well.

Louise Chen : Thank you. Can I just ask you one follow-up question? So, for fourth quarter ‘23, then you would expect OPEX to be similar to third quarter, or would there be some ramp-up for the start?

Frank Bedu-Addo: There will be some ramp-up in Q4 of this year. So, we spent about $10.5 million in total in Q3. So, my expectation would be around there or a little higher.

Louise Chen : Okay. Thank you.

Operator: Thank you. Our next question comes from the line of Mayank Mamtani with B. Riley Securities. Please proceed with your question.

Mayank Mamtani: Appreciate the comprehensive pipeline update. So maybe a high-level question quickly for you guys. So, given 0101 prolonged survival and the higher ORR, you seem to have the driven by 01ADC investor, one investor generally wonders if perhaps it makes sense to also evaluate triplet in first line or should we think of triplet to be more in the ICI resistance patients or maybe even being HTV agnostic? Could you just clarify how you’re thinking, relative positioning of these two programs? And then I have a couple of follow-ups.

Operator: Frank, if you’re speaking, you may be on mute.

Frank Bedu-Addo: Thank you very much. Yes. So Mayank, I think, you are absolutely right. We have seen highly encouraging survival data with PDS0101, as well as PDS01ADC, as well as extremely encouraging ORR with the PDS01ADC. Now, we have certainly considered the application of the PDS01ADC in the earlier line ICI naive. However, after talking to key opinion leaders in the field, as well as the regulatory experts, it’s evident that the survival and safety data generated with a doublet, presents the most straightforward regulatory pathway, as well as the robust uptake if and when it becomes standard of care, right? With the doublet will also enable a more rapid potential approval path for early, even early use. Now, when we look at the triple in the ICI resistant population, it also presents the quickest path to approval and potentially application in multiple HPV cancer indications, as you mentioned, essentially tumor agnostic.

This triple combination may then also subsequently find its way to an approval for use in ICI naive patients. So, this is something we have actually seriously considered, but after talking to the experts in the field, the two options we are taking now appear to provide the quickest paths to rapid approvals and uptake.

Mayank Mamtani : I understood. Thank you for that clarification. And then maybe drilling down on the doublet trial protocol, are there any details on the SAP that you’re able to share in terms of the target OSS [ph], differential, you’re going for against standard of care? I recognize you are talking about sites, but not specific patient numbers, but just sort of it would be helpful to understand what sort of hazard ratio, what sort of delta on OSS you’re aiming for. And this is related question, your ESMO translational biomarker data was actually quite novel in context of demonstrating CD8 T-cell responses specific to tumor cells. So, I was wondering if there are any implications of that in terms of patient enrichment or response assessment strategies that you could deploy in your late state development.

Frank Bedu-Addo : Mayan a lot of really good questions. So, let me start with the biomarker data. So, with the biomarker data, as you did mention, we are looking at a number of novel approaches to really understanding and documenting how PDS0101 is working and really documenting and clarifying the differentiation of our assets. So, if you look at the data presented at ESMO, for example, looking at the poly functional CDA T-cells, confirming increase in poly functionality was very important. But also understanding the kind of immunological profile that PDS0101 is promoting, for example, going from a TH2 bias to a TH1. TH1 being well documented to be better associated with strong CD8 T-cell responses, right? And also showing that we have potential exit of the CDA T-cells from the blood to the tumor sites, right?

Showing the decline in circulating peripheral blood, um, containing CDA T-cells. So, we have that approach in that study in the PDS0101 KEYTRUDA. Now, when you also look at what’s been done in terms of biomarkers in the Immunotherapies study, right? Very complimentary to what we’ve seen with the PDS0101 KEYTRUDA study. In the IMMUNOCERV study, what MD Anderson was looking at is circulating tumor DNA. Circulating tumor DNA is extremely important for a number of reasons, right? If you look at cancer today, most patients don’t die from the initial tumor or the initial cancer. They often die from micrometastatic cancer that remains after the initial treatment, right? And so being able to essentially eliminate the tumors from the patient’s body becomes extremely important.

And how do you know that your technology or product is actually achieving that? What we have seen now with our circulating tumor, DNA in that study is the strong potential for PDS0101 to actually dramatically eliminate and reduce and eliminate the circulating tumor DNA, right at five weeks, 92% reduction versus 52% reduction with the standard of care. MD Anderson is extremely excited about that because they believe it has direct implications for patient survival and very importantly, recurrence of the cancer, right? So that is — data that we will hopefully be expecting to see coming up in 2024, how that elimination of circulating tumor DNA correlates with recurrence of the cancer and survival of the patients. Now, what they also looked at a very innovative approach using cervical brushing to really quantify and understand the kinds of T-cells that are actually accumulating in the patient’s tumors, right?

So, we talked about the CDA T-cells in the blood and exiting the blood, but it’s also important to understand what’s happening in the tumor. And what they also showed was a really strong correlation between this elimination of circulating tumor DNA and accumulation targeting accumulation of the CDA T-cells within the patient’s tumor, right? So, again, very different to date, most of our peers have looked at T-cells in the circulating blood, looking at things like interferon gamma, but what we are showing here that these T-cells generated by diverse immune technology actually do target and accumulate in the patient’s tumors, right? So again, we have very complimentary studies which are in agreement with each other, which are given us a really good picture of how and why we’ve seen the results we’ve seen in these patients today.

Now, if you go to the triple combination, very similar studies have been performed by the National Cancer Institute in the triple combination. Again, showing that very strong correlation between induction of HPV16-specific T-cells and the clinical responses and also showing that this triple combination in addition to inducing strong tumor-specific multifunctional T-cells, also induces an inflammatory immunological profile, which is strongly believed to suppress the tumor stability to hide from the immune system, right? So now we are getting all the information that we — that helps us better understand how and why we are seeing the kinds of results we’ve seen today in these patients, even in the very difficult-to-treat patients. So now coming to your earlier question, which had to do with the design of the VERSATILE-003 trial.

Now we have not made details of the clinical design public yet, but I can give you some insight into how we are thinking about this. The delta today is quite significant when you look at the delta of what we’ve see at the two-year results versus what we see in the published data, we know that by far exceeds what we’ll have to achieve for approval, but as a risk mitigation strategy in terms of our statistical design, what we are also looking at is we are also saying, well, let’s assume PDS0101, the patients in our control arm taking KEYTRUDA, we’ll do much better than KEYNOTE-048. And so, in terms of our endpoints for the control arm, we are anticipating that they’ll be higher than KEYNOTE-048. Oncologists are getting more used to administering KEYTRUDA.

They’re getting better understanding of which patients may respond better. And so, we have to assume that those patients are going to do better than has been published today. What we are also assuming in that design is that our patients in the study at multiple sites all over the world will not do as well as we’ve seen in VERSATILE-002. So, we are also reducing that target, and that risk mitigation allows us to overpower the study based upon what we’ve seen today and mitigate the risk that we will not get to that clinical endpoint. So, we are taking those strategies into consideration just based upon the really large delta we’ve seen today, allows us to narrow that delta, but also be reasonable in terms of trial size and the power of the trial to successfully achieve those primary endpoints of overall survival.

Mayank, I hope that answered your question.

Mayank Mamtani: Yes, no, very comprehensive, very helpful. Lastly for Matt, just quickly on the strategic collaboration discussions, are you able to describe qualitatively interest from strategic on doublet versus triplet and how maybe recent Triplett data may have informed those discussions, and also, there’s a full data set from your double-edged expected in second quarter. Would they want to see that mature analysis before transacting or like kind of just lay out what sort of the variables are there that impact discussion like that? Thanks for digging the question.

Frank Bedu-Addo: So, Mayank, I’m not going to be able to go — I’m not going to be able to go into specific….

Matthew Hill: Do you want to take that one Frank?

Frank Bedu-Addo: Yes, I’ll take that one. Yes. So Mayank, I won’t be able to go into very specific details as to what we are discussing. However, the data that we have today has been very helpful in clarifying certain things. So, one of the key things that I mentioned over the last couple of earnings calls has been the fact that we are waiting to see the data from the VERSATILE-002 refractory arm. That data was very important because it was key in giving us insight into the specific role of PDS0101 or the contribution of PDS101 in extending life in head and neck cancer patients. And so, looking at that combination of PDS0101 in KEYTRUDA, in patients who have failed checkpoint inhibitors, the majority of which we know were on KEYTRUDA, and still being able to extend those patients’ lives significantly was very important for us to demonstrate and to get potential partners also comfortable that, okay, PDS0101 is actually biologically active in this population and even seeing this extension in even a much more difficult to treat population.

So that was key. It was also important for us in the triple combination trial, as I mentioned previously, for us to have that understanding of what PDS0101 is doing in that combination. Because a lot of the questions we receive, both from investors and prospective partners is well in the triple, how do we know which of these components is working and what is contributing to what, right? So now the role of PDS0101 becomes very clear, but with the data we have today, right? We also now see the critical role of PDS01 ADC. And so now both components, both drugs have very clearly shown their biological activity. And what was also very important is you look at VERSATILE-002 right refractory arm, no IL 12, 0% of confirmed objective response. If you add a low dose IL 12, 5% confirmed objective response, if you go to a high dose IL 12, 63% confirmed objective response, very clear in terms of what’s happening with the IL 12, right?

So, all this data that is now available provides not just PDS, but potential partners with confidence in the biological activity of our drugs, right? In terms of discussions, I’ll say there are no issues with the current protocol, right? As you know, we have alignment with the FDA on the path forward, but what’s happening with these discussions is not at all uncommon. And we believe that it is prudent to at least evaluate suggestions that the serious potential partner may have, even though there are no guarantees that the partnership will resolve when all is said and done right. But there are number of typical things that we’ll typically want to evaluate at this case, and we’ll not do this for every prospective partner or suggestion we receive, however.

So, I hope that gives you some flavor of what — the data we’ve seen today and how it’s impacting discussions that we’re having.

Mayank Mamtani: It does. Thank you for taking your questions and look forward to future updates. No problem. Thanks a lot.

Operator: Our next question comes from the line of Joe Pantginis with HC Wainwright. Please proceed with your question.

Joe Pantginis : Hi, good morning, everybody. Thanks to taking my question. Two questions please. So, first for 0101, wanted to ask about currently what you have ready to go followed by your intermediate near term needs and intermediate needs with regard to manufacturing? And then the second question is a little bit of the off the beaten path here. Because it’s been nice to hear such the encouraging data updates from a 0101, but I wanted to ask about 0202 and the universal flu vaccine. You are sitting on what we consider to be a very strong asset profile and the data that you’ve accumulated to date. So other than the rhetorical answer of financial resources, what could you envision being a development plan for that asset? Thanks.

Frank Bedu-Addo: Hey, thanks a lot Joe. I’ll start with the first question in terms of what we have ready to go with PDS0101. So, with PDS0101, we have done all the tech transfer. The material has been scaled up to our commercial process, and the Phase III clinical product has already been successfully manufactured and released. So, in terms of clinical product that has been scaled up to the final process and has been successfully manufactured, we are there today. So, the material is ready to go. We don’t have any additional needs from the perspective of PDS0101 materials in order to run the phase — to run the Phase III clinical trial with either program VERSATILE-002 or the triple combination. With PDS0202, as you mentioned, this is a program that we are quite excited about.

Today, our resources, financial resources are really focused on the oncology programs. However, we have made significant progress also with this program. As you know, the data was presented in September at the European influenza Conference. The data from ferrets, right? Ferrets being the gold standard for preclinical studies. So, it was very important to be able to demonstrate that we can replicate the data that was generated in the mouse models in the ferrets, which are closest to humans in influenza. And again, all that was done has been done successfully. We’ve shown very similar levels or identical levels of broadly reactive neutralizing antibodies against multiple strains of the flu that was shown successfully in Ferrets. We also showed successful prevention of viral replication in the lungs when the animals were given lethal doses of the H1 N1 virus, as well as protection against infection in the ferrets also.

So, we have shown very good translation. Now, from PDS perspective, for us, this is not surprising because again, even in our oncology products, we’ve shown very good translation from preclinical models to human right. And so, we expected this. The NIAID is extremely encouraged by the data that they’ve seen today. And so, we have had some discussions. We are still hopeful that we will get some notification sooner or later regarding the next steps. What we would envision or what we would like to see would be for this to go into at least a Phase I Phase II human clinical trial sometime next year, and start generating the human data that can also replicate the kinds of broadly reactive neutralizing antibodies that we’re seeing in the animal models in humans, hopefully give — provide very important data on safety.

As you know, with preventive vaccine safety is extremely important. We’ve seen very good safety profile today with PDS0101. So, we do expect to see very similar safety with the preventive vaccine. And then hopefully, depending on when in the year it’s done, get some data on actual prevention against infection with the flu. So, we are really hopeful. We still are very good discussions with NIAID. They’ve indicated that this is something they would like to move forward, and so we are waiting to learn what the next steps will be and when those next steps will start.

Operator: [Operator Instructions]. Our next question comes from the line of Jim Molloy with Alliance Resource Partners. Please proceed with your question.

Laura Suriel: Hello, this is Laura on for Jim. Thank you for taking the questions and congrats on all your progress. So, you mentioned an upcoming trial for your preclinical PDS0103 candidate for the first half of next year. What are any other updates that you have for your preclinical PDS0102 and 0104 candidates?

Frank Bedu-Addo: Hi, Laura. Thanks for the question. So, with PDS0103, as I mentioned, the goal is to start in the third quarter — in the first half of next year, and so that is going to be done under our collaboration with the NIH. Right now, we are finalizing the CMC section. We are finalizing the animal studies and looking at the new triple combination, which is potentially going to be very likely the path we go down. That’s been evaluated now in specific tumor models that we would want to include in the IND filing. So, we are working towards an IND filing hopefully in Q1 of next year to get this into the clinic, hopefully by the second quarter of next year. With PDS0102, we are also working now on the tech transfer, and the formulation development has been completed.

Preclinical work has been completed with PDS0102. And just to remind, just to remind the audience who may still be on PDS0102 specifically addressing prostate cancer. So, I’m sure you can see how that potentially lines up with what we are doing with docetaxel. There is the potential that we could include that to make a new triple combination. But the goal here with that program is to get that dual combination as rapidly as possible to commercialization, but there’s potential for expansion in terms of even more difficult or latest treat cancer patients and decline of circulating tumor DNA using that PDS0102 asset in which the target is top, TARP. TARP has been found in about 90% of prostate cancers at all stages of the disease and about 50% of breast cancers.

So that’s an asset that we do anticipate hopefully getting into manufacturing sometime next year in 2024 to allow us to start to evaluate that asset. Also, probably later in the year, but we’ll provide updates regarding what the what we’re doing with that process program, what the potential partnerships, how we’re going to move that forward. We’ll provide some of, some more of those details later as the year, the year goes by in 2024 PDS0104, we have not yet made any additional progress with PDS0104. We’ve really concentrated on PDS0101, 0102, and 0103 at this point, as well as PDS01ADC.

Laura Suriel: And also, just one more question alongside the data presented for IMMUNOCERV, for your other investigator-initiated trial of PDS0101, this with the Mayo Clinics. Do you have any estimates as to when you might get data announced here?

Frank Bedu-Addo: No. So with the Mayo Clinic, starting with the Mayo Clinic, as you mentioned that’s another investigate-initiated trial, it’s evaluating the early stage HPV16 positive oral cancer in neoadjuvant setting. We have been informed, as I mentioned, by the PI, that they hope to present preliminary data at the scientific meeting in the first half of 2024. And so, we’ll keep you updated as we learn more as to what conference that would be and what the exact timing would be. But we are hopeful that we’ll see some data — we’ll see the first preliminary data from that trial, hopefully in the first half of 2024. And with IMMUNOCERV, the investigators are extremely encouraged with the data that they’ve seen today. Based on what we’ve been told by Dr. Klopp of MD Anderson who leads this trial, she’s actually planning on submitting interim results of the study for scientific publication, and particularly the recent circulating tumor HPV DNA outcomes reported at ASCO.

The previously reported tracking, and accumulation of multifunctional CDA T-cells in the tumors, and she also intends to update clinical response and survival data. So, we are hopeful that we’ll get an additional update on that trial in the near future.

Operator: Thank you. There are no other questions at this time. I’ll turn the floor back to Dr. Bedu-Addo for any final comments.

Frank Bedu-Addo: Thank you very much. So, thank you to all for participating in our third quarter earnings conference call today. The progress made this quarter has been truly exciting. We remain enthusiastic about what lies ahead for the rest of this quarter and into 2024. We have made significant strides towards our objective of developing groundbreaking therapies that transform cancer treatments. We are confident that our efforts will positively impact these patients with critical unmet medical needs leading to longer lives and improved quality of life. We appreciate your continued support and eagerly anticipate updating you on our accomplishments. Thank you very much again, and have a wonderful day.

Operator: Thank you. This concludes today’s conference call. You may disconnect your lines at this time. Thank you for your participation.