Transcript: Paul Wotton, Cantor Fitzgerald Inaugural Healthcare Conference, 7/8/15
By, Patti
Webcast
1. Paul Wotton - Thanks for the invitation to speak here at the inaugural Cantor Fitzgerald Healthcare meeting. It's a pleasure to be here.
2. Ocata is really the regeneration of a company which was known as Advanced Cell, a company with a lot of science behind cell therapy and our specialty is taking a stem cell, whether it's a pluripotent stem cell derived from an embryonic stem cell line or induced pluripotent line, and then making fully differentiated final cells out of those products. Our first program is addressing macular degeneration with groundbreaking retinal pigmented epithelium therapy. We've reported data now in the Lancet and more recently in Asian patients where we have actually seen safety, good safety, in addition to anatomical and functional evidence of repair and indeed vision restoration in some patients in those Phase I studies. These were safety studies. We are just about to initiate a Phase II program in dry AMD. Just want to differentiate that from wet AMD. There is no treatment out there today for dry AMD. We also as Caroline mentioned, are working on an orphan indication for the same type of cell which is Stargardt's macular degeneration, which is a juvenile version of AMD and that is an orphan indication in this country and in Europe.
3. Most recently we have also received the Advanced Therapy Medical Products status in Europe. We do intend to apply for Breakthrough Therapy here in the United States once we have that Stargardt's macular degeneration Pivotal trial up and running.
4. The easy way to think about this is liver transplantation and kidney transplantation has been around for decades now and both of those organs are really life support systems for our body. The RPE layer at the back of the eye, we are born with one layer and that's it. If you lose it, you start to lose your vision. What we're doing is simply doing a micro transplant at the cellular level of cells which are nursing cells for the photoreceptors at the back of the eye. They are not required to wire up with anything. Their job is to nourish the photoreceptors and keep them in a good state of health. So they're a life support system for the back of the eye.
5. This year we have been busy focusing the company on the ophthalmic programs. We completed our Phase I/II safety studies at the highest dose now, which is 200K cells per eye. We did do a dose escalation study from 50K cells through 100K to 150K and now 200K cells in the injection and have completed that. We've had a Pivotal trial discussion with the European Medicines Agency and looking at the timing of that, it appears that we could be going to market as early as 2019 in Europe. We've generated safety now in 44 patients with up to four years of follow up, which is quite significant. I'll talk about that later.
6. We just uplisted the company onto NASDAQ. Our liquidity is improved. We were listed on the Russell 2000 Index recently, first time ever in the company's history. We published the data on Asian patients in April, which supported all of the information we have seen in the Lancet, which was published last October. We've brought in what we think is the best in class induced pluripotent stem cell technology from Allele, which we have been working on for a number of years, which has helped us with our pre-clinical pipeline and we'll talk about the photoreceptor progenitor cells later on during this presentation.
7. We've received new patents around our RPE program. We were the originator of this program and consequently have a strong patent space as well. I'm pleased to say that we just completed the $30 million financing which funds us well through the next inflection point, which will be sometime in April or May of next year when we start generating good data on our Phase II program in dry AMD. I'm actually quite pleased that we managed to get that financing done before the Greek meltdown in Europe, because I think that's going to be bigger than people expect and we've entered the Russell 2000 Index, which has increased our visibility.
8. This is what it looks like if you have your RPE damaged. Eventually you lose the central visual acuity that we all have right now. The effect is that the patients lose their central vision. They can't drive. The economic effect is quite significant as well on the economy here today. It must be really tragic to lose something that you had all your life. Having lived with somebody who actually went blind in her late 30's, I can tell you it's quite a devastating thing to see.
9. The first evidence of long-term safety and efficacy was actually from our study, which was published in the Lancet (See the paper »). Steve Schwartz is our primary investigator here. We actually published this last year. It was the first time that anyone had shown long-term safety of cell therapy in patients, and it's really a retinal transplant as Steve labeled it. We saw not just good safety of the cells, but we also saw efficacy signals as well. That data was supplemented in April with four Korean patients that were reported. These were two with dry AMD and two with Stargardt's. The visual acuity improved in three patients between 9 and 19 letters, which is clinically significant, and it remained stable in one other patient.
10. We have now treated 44 patients worldwide. I think the independent Asian population that was treated here with cells that had been generated from a Caucasian line would suggest that we actually have a global therapy here in our hands.
11. The reason we are doing it in the eye, our strategic intent is actually to own the eye. There are a lot of eye diseases that are coming to the fore now. The eye is an immune privileged site, which means when you inject a cell into the eye, the likelihood of rejection is very low because it is an immune privileged site. As mentioned earlier, we have patients now who have been out to nearly four years with the transplants in place, and they are not on immune suppression therapy at this stage, so we know that the transplant has been well taken up. The eye is also a compact structure so it means that you can actually use small doses of cells to treat disease. The delivery technology we are using is tried and tested and familiar to retinal surgeons today. We are not reinventing anything there. More importantly, the FDA, and we have frequent discussions with the FDA, we are using a validated source of the clinical outcome assessment, so it's a matter now of generating data and optimizing the selection of the patients in order to get us to the goal post in the next round of clinical trials.
12. The company as I mentioned right at the start, we are a world leader in terminal differentiation of pluripotent target cells. We can do this either starting from human embryonic cells or induced pluripotent cells. In the case with the RPE, it's an embryonic stem cell line we had used, and in the case of the photoreceptor progenitor cells, as you will see from the data later, we generated better tissue as a result of the iPS in that particular case, and in the case of RPE, generate better tissue with RPE from an embryonic line than you do from induced pluripotent line, at least in our hands.
13. So stem cells are our starting material, but fully differentiated cell for the treatment. We have banks of cells up in Marlborough. We start with one cell. That's all we need from an embryo, and then we can move that into millions and millions of cells literally. We're developing a pipeline as well. That's the other thing. The RPE is in the clinic as I mentioned earlier, but we do have a number of other cells that we are able to manufacture, photoreceptor progenitors, which actually would go hand-in-hand with our RPE therapy for macular degeneration, as well as retinitis pigmentosa. That one we're actually planning on filing an IND some time within the next couple of years to take our next program forward. We can develop retinal ganglion cells for glaucoma, and also other interesting diseases that affect the corneal membranes as well.
14. So we have actually developed this pipeline. The company itself, though, has other interests in other therapy areas such as Crohn's disease, which we've actually just put on the back burner while we focus on the ophthalmology area.
15. Let's talk about why dry AMD and Stargardt's are interesting diseases. The first from a prescriber perspective, there is a very small population of prescribers here in the US for these procedures. Stargardt's is an orphan indication, but dry AMD is becoming an epidemic in this country. There are more than 15 to 20 million patients in this country with dry AMD. It is increasing as we all age. It's a multifactorial disease, somewhat attributed to smoking, there's obesity, just getting older in general, and possibly the lifestyle we lead as well, but the fact is, as we all get older, we are seeing more and more patients being diagnosed with dry AMD. Dry AMD is the precursor to wet AMD, where there are two successful therapies on the market, for example Eyelea. Our aim is to catch those patients before they go through to the wet AMD stage.
16. (Scientific talk of the eye and loss of RPE and results not transcribed.)
17. In the case of AMD it just degenerates. In the case of Stargardt's, it's a genetically inherited disorder and what happens is the photoreceptors themselves throw off a toxin which gets taken up by the RPE layer. Stargardt's presents itself typically when you're a teenager and eventually the pigmented epithelial layer dies off as a result of absorbing this toxin, and by the time you're in your late 30's, early 40's, you've pretty much gone blind. So our job is just to simply replace that pigmented epithelial layer with new cells that we manufacture up at Ocata and then inject into the back of the eye.
18. Some of the photoreceptors we believe remain dormant and what we have tried to do next is to inject just a simple suspension of cells into the back of the eye and the goal here is to regenerate those dormant photoreceptors. The cells are highly polarized. They sit up in the right way and what we see next is the regeneration of those photoreceptors and hence, what our clinical study showed, a pictorial of the back of the eye of a patient who has received a transplant. The RPE layer two little blobs there, those are two RPE cells literally. This is a patient who has lost their RPE layer. The next picture shows you where we've injected RPE cells into the retina and you can see there is a single cell line there that is starting to build up. After 12 months, what you can see at the back of the eye is a line there which actually shows increased pigmentation. This is where the RPE cells have taken residence, they've started to grow out and the back of the eye is showing better pigmentation. We have seen that now in patients who have gone out for four years now with this cell therapy.
19. So the anatomic evidence is there, which supports the fact that these cells are taking residence and starting to regrow.
20. Updated status on the trials, we had actually just reported 31 patients have now been followed for at least 12 months in June; 26 patients of those were from the US. We have 5 from South Korea now. That's diverse populations. As I mentioned, some patients now have up to four years follow up. We have a lot of patients now over three years and a lot more over two. We have seen no evidence of any adverse proliferation, rejection or other systemic safety issues, which is good news, related to the transplanted RPE cells. And importantly, we have seen patches of increased retinal pigmentation which is persistent and that indicates that the transplants have taken successfully. In the patients that we actually reported in both the Lancet and that Korean publication, what we have shown is that we have done this with patients who have only had 12 weeks of immune suppression therapy, and that's important, because in the next phase of our dry AMD study, the Phase II, which we are just about to implement, we are dialing down the immune suppression regimen. The suggestion from the studies we have done so far is that clearly after four years, if you still have transplant in place, that the immune privilege nature of the eye is holding up.
21. This is some of the data, just briefly to show you, this is 12-month data in dry AMD where we had a vision gain in the treated eye. We saw an initial gain in the control eye, which was the other eye which was used as the control in the patient. What we're doing in the next round of studies is we are switching away from the control eye as the control for the transplant into a control group of patients who do not receive the therapy. The reason we are doing that is because we believe that it will generate more robust data for us to enable to go into Phase III. So we have seen the transplant taken up. We've seen an efficacy signal, and going forward now, we're going to be moving into advanced studies, both in Stargardt's and in dry AMD. So the Stargardt's Pivotal trial, which is certainly pivotal for Europe, we're initiating, we're in dialogue with the agencies both here and in Europe. It's going to be a double masked study, try and avoid the double blinded study in presentations like this, but it's a one-to-one randomization between patients who have been treated with the cell therapy and patients who are receiving not a sham procedure, but they'll be receiving the anesthesia associated with the procedure and they will think they’ll be getting a transplant. They also will be receiving dummy immune suppression regimen as well for the 12 weeks, 6 weeks period that we'll be looking at into the cohorts.
22. There are three cohorts. The first cohort that we are going to be treating, we'll use the same regime of immune suppression as the study that was published in the Lancet. What we're aiming to do is to repeat the Lancet study with a control group of patients who haven't been treated with the cell therapy. And as I mentioned, the reason we're doing this is to generate much more robust data for moving into Phase III.
23. So that's the highlight on the dry AMD study. The first data readout from that will be some time in Q1/Q2 of 2016, so I think that's going to be a big inflection point for the company, not just for us maybe, but also for other companies working in the cell therapy space, and success in this control study will support both the SMD program and our other programs which we are conducting in the back of the eye.
24. I'll talk a little bit about the preclinical pipeline, because this is important. One of the things that the company has been very good at doing is working in the ophthalmic space because we can. I don't think that the company has had enough credit for what it has done in ophthalmology. This is some data that was generated by Robert MacLaren at the University of Oxford in the UK, and what we did is we created photoreceptor progenitors from both embryonic lines and induced pluripotent cell lines. What we're able to show here, we take mice that are genetically bred to have no retina basically, and what we can do is after three weeks, when they become blind, we left them until 10 weeks when they have no photoreceptors, inject them with a buffer or photoreceptor progenitors here through either embryonic line or induced pluripotent line, and then after three weeks you can actually then track their progress in a light box, and what you look for is the way the mouse sees the light. And these are mice that saw nothing. You just do the head tracking experiments. You can see this here, whereas when the mice were actually treated with these photoreceptor progenitors, they were able to start tracking in the lights as they were flashing up in the light box. And that by the way is a validated preclinical model for blindness. So we're able to show that this product could actually work potentially and complement the RPE therapy, at least in our models. We didn't just do one animal model, we actually did two animal models including the Royal College of Surgeons rat which showed very similar data. We've now got this in a pre-IND program at the company and will just move it forward.
25. I'll talk about our corporate operations. I think one of the things that the company has spent a lot of time and money on was investing in manufacturing, so we have a GMP suite up at Ocata. In fact we have two. We have a pilot scale facility as well as full scale manufacturing suite. We have 12 full-time employees whose sole job is to manufacture RPE right now. We've been inspected by the FDA. We've been cleared by the European Agencies. All of our processes are in compliance about the cells, and this continued investment in advances that we have made in manufacturing has also allowed us to improve our intellectual property estate as well.
26. So our IP coverage goes all the way from the stem cell line to patient treatment. We are able now, I think we have about over 80 patents have been granted in the US. Significantly, we just received four patents in June, which really solidify our space in RPE, so that covers things like the method of use and all that sort of stuff, pharmaceutical preparations, the way you deliver these RPE cells. I think from that perspective the RPE line and the work we are doing there is very well covered as you'd expect.
27. Financial overview, I'm pleased to say that we now have a strong balance sheet compared to where it was last year. This company is really a turnaround story, and I think we've done a really good job the past year in solidifying everything we needed to do to enable us to move out to the clinic with the programs. This is a very exciting big market opportunity, so I think there is a lot of interest in what we are doing right now. We closed the $30 million equity offering in June. We have cash on hand now into late 2016, which is a lot more than the 8 months that some on the message boards credit us with, so I'm pleased to be able to put that myth to bed. We have about 40 million shares outstanding. We have no preferred stock, no debt, and the balance sheet is now fully cleaned up. We re-listed on NASDAQ in February and I think that this company now is in a good position to be able to generate data now in dry AMD in particular, which this time next year will really put us in a great position to then move up into the Phase III studies in dry AMD, while still pursuing the Stargardt's program.
28. So here are the milestones going forward. I'm going to put the key ones up here. There will be lots of other announcements regarding IP and stuff like that, presentation at conferences and so on, but the first subject will be enrolled in the dry AMD Phase II study shortly. We've got now six study sites, which we've been able to talk to and get fired up ready for the next round of dosing. Most of our IRBs have now been approved. We are waiting for Special Protocol Assessment discussion with the FDA around the Stargardt's program, which will then trigger the Stargardt's Pivotal trial. As I mentioned, we're going to see further strengthening of the IP portfolio. The publication of data on the preclinical photoreceptor studies is expected shortly in a peer review journal, and we are in partnership discussions with companies around some of our assets. We have in 2016 I think probably the big inflection point is the report on that dry AMD Phase II study and I think we're sort of the leading cell therapy in dry AMD right now in terms of the number of patients we have treated. This cohort coming up with that data in April or May of next year is tremendously important for us and for others in this industry. Then we have the second cohort reporting on that one. This will be the dialed down immune suppression dose reporting some time in Q3 of 2016.
29. So with that, I think I've come to the end of the presentation other than saying that the management team that we've pulled together is a strong one. I would just point out that Bob Langer, who I think was one of the founders of the previous company presenting here just before me, is on our Scientific Advisory Board. He's the chairman of that, but you can see that we have also Joe Vacanti on our SAB, who is one of the other scientists behind the prior company, and we've built I think a Scientific Advisory Board and a Board and we intend to add to this Board later on during this quarter in order to make sure that we can bring the right expertise into this company to make things happen going forward.
30. I've been through most of these milestones before, so I won't repeat myself, but needless to say, it's going to be a very busy 12 months coming up and I think you can expect to her a lot from Ocata as we continue to make progress in our studies. That's it, thanks very much for the attention.
31. Q: You haven't developed any teratoma?
32. A: No.
33. Q: Not at all, and why is that.
34. A: I think the reason that we went to putting RPE cells into the back of the eye was important, because if you put differentiated cells into the back of the eye and you don't put a stem cell into the back of the eye, you're putting in a class of cell that it can't turn into anything else, so you won't see a teratoma formation as a result of that. We didn't see it in any of the animal models and we didn't see it in any of the patients we have treated, which is now 44. It's a good question.
35. Q: Unintelligible.
36. A: So the idea of the therapy, certainly dry AMD is patients get one shot and done for the rest of their lives. In Stargardt's, it's quite possible, because they're still producing the toxins in the photoreceptors, you might need a retread of the RPE layer some time in the future. We don't know what that time would be, but it's quite possible the Stargardt's patient would need maybe two injections in the course of their life. I think there's a good opportunity to combine the RPE therapy with some of the gene therapy programs now, which are looking to knock out the production of that toxin in the photoreceptor layer, which is certainly something we're looking at trying to do as well.
