Avid Bioservices Inc (CDMO)

[cjgaddy]

Excerpts+Slides from SK's 3-17-10 ROTH Talk (DanaPT CA)

3-17-10 CEO Steve King, Roth 22nd Annual OC Growth Stock Conference (DanaPT CA)
Webcast replay: http://www.wsw.com/webcast/roth23/pphm
http://www.roth.com/main/Page.aspx?PageID=7226

A few Slides & Excerpts from S.King’s 3-17-10 ROTH Presentation:

P E R E G R I N E
Pharmaceuticals, Inc.
”Innovative Science to Treat Life Threatening Diseases”
Roth 22nd Annual OC Growth Stock Conference (DanaPT CA)
March 17, 2010






SK 3-17-10, Slide05: “Recently we recognized that as we were moving into later-stage clinical studies it made sense to beef up the team. We were very pleased last Sept. to bring on board Robert Garnick as the Head of Reg. Affairs [ 10-19-09 http://tinyurl.com/yga7z4x ]. He was formerly Sr. VP of Reg. Affairs, Quality & Compliance at Genentech – he was with the company for 24 years, and really masterminded the approval of the major bio-pharmaceuticals that are on the market today, Rituxan, Herceptin, Avastin, Lucentis. So really, there’s no one in the world with a better regulatory track record in the dev. of biologics than Rob… Another addition was Marvin Garovoy this past January [ 1-11-10 http://tinyurl.com/yz4fwyv ] – he brings extensive experience in the design & conduct of clinical trials. We brought him on board to really beef up the team and to allow us to pursue addl. opportunities, such as Investigator Sponsored Studies (IST’s), which as we’ve gotten into the Ph.2 data, we now have people coming to us wanting to run addl. studies with our compound. On the Avid Bioservices side, we brought on board Truc Le Avid’s COO [ 8-28-09 http://tinyurl.com/m85erv ]. Avid represents about a 100-person operation, so it needs a dedicated mgt. team, and what Truc brings to the table a lot of industry experience in the areas of lean manufacturing, and as our operations & throughput have grown, he’s come on board at just the right time to see us to the next stage.”
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SK 3-17-10, Slide7: “…And then we have a real interesting part of the portfolio, which is our Bavituximab Viral Hemorrhagic Fever (VHF) Infection program. This is completely funded by the DOD in evaluating Bavi for the treatment or prevention of VHF. What’s interesting about this compound is this would not take a typical Phase1-2-3 approval approach, but rather likely go thru the FDA’s “Animal Rule”, which means that it basically would have animal efficacy data, combined with human safety data, which we’re obviously generating a lot of, and then it would be applied for approval based on those 2 things. So this could be a much shorter entry point into an actual product that could be acquired by the gov’t to stockpile as part of its biodefense efforts.”
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SK 3-17-10, Slide9: “Bavituximab is a very novel therapeutic, a whole new class of compounds, based on a target that we think has very broad potential across many different infectious diseases as well as cancer. While that seems unusual, it’s really based on the mechanisms by which the drug acts…”
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SK 3-17-10, Slide10: “…I think what has the regulatory group the most excited is really the high potential in Refractory Disease… In the case of cancer, we’ve shown that even in resistant tumors, the tumors that are no longer responding to the chemotherapy, when you give that same chemo, you still get an up-regulation of your target, and you still get enhanced anti-tumor activity. Of course, this is ideal in a cancer setting from a dev. standpoint because the fastest way to market is in Advanced Refractory Disease – 2nd & 3rd-line settings, and that’s where we see the potential and the fastest way to get this drug on the market.”
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SK 3-17-10, Slide11: “…In the oncology setting, again, we’ve completed 2 Ph.1 studies - positive safety profile. We had an opportunity to present a 240-patient integrated clinical safety summary to the FDA. Based on that, we agreed that the safety package to-date does support accelerating & expanding the clinical dev. program. We’ve established a max dosing level of 3mg/kg – this is based on binding & mechanism, not on serious adverse events. And we’ve seen promising results from signal-seeking Phase II studies...”
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SK 3-17-10, Slide13: “A number of things have come out of these Ph.2 signal seeking studies. They were based very closely on prior Ph.2 studies evaluating the chemo alone. And that’s the bar you see in grey here as our comparators. There were really 2 goals here. One was to look at the safety profile when given with diff. chemos. 2nd was to see if we had some signs of activity. 3 things have really popped out of this. The 1st is we see very consistently high tumor resp. rates (TRR), ranging between 50-64%. The 2nd is the Docetaxal combo [Adv.Breast] compares very nicely with the historical data - 61% TRR and 7.4 mos. PFS #’s are both very positive. And 3rd, the NSCLC data is really just outstanding – the 52% TRR is extremely high in this patient population – typically very close to a 20% TRR with chemo alone, and 6.5 mos. PFS is also very promising. We anticipate having addl. clinical data coming from these studies probably throughout the rest of this year. The data presented here is only for the 1st cohort of patients in the both NSCLC and the Carboplatin/Paclitaxel (CP) Breast Cancer study, so we’re planning on having an update on those by mid-year and then probably an update on PFS a little later in the year. And we’ll also be able to report on the entire, completed study in the Docetaxal [Breast] study.”
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Note: [ Recall that in the two India Ph.2 trials (Bavi+CP), we only have interim data on the Stage1’s:
• BREAST: 64% ORR%, n=14 (evaluables) . . . awaiting Stage2 interim data (n=31).
• NSCLC: 52% ORR%, n=21 . . . awaiting Stage2 interim data (n=28).
…In the Rep.GA Ph.2 MBC Trial (Bavi+Doce), S1+S2 (n-46) interim data was reported 10-21-09: 61% ORR%. ]
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SK 3-17-10, Slide14: “So, this has led to the planning of the next set of studies. We’re in the process of operationalizing a 2nd-line, Bavi+Docetaxal study in NSCLC – again, we’ve seen prior signs of good activity in NSCLC, and we know that the Docetaxal combo appears to be active. This will be a ~120-patient Phase II study, double-blinded, placebo-controlled, so a real proof-of-principle study. It has many of the hallmarks of a Ph.3 study, so it’s almost line a miniture Phase III. We refer to this as a Registrational Phase II Study, because we believe that if we have results anywhere near approaching what we saw in the earlier study, it could be a conduit for Accelerated Approval. At the very least, this s/b an integral part of an eventual Registrational Package that may include a Ph.3 study.
The 2nd NSCLC study is another combo with CP, so basically a repeat of the study I just showed you in a Ph.2 controlled setting, where we’ll have a control arm as well as the combo with Bavi.
In addition, we’re evaluating a fair number of other opportunities - in Breast Cancer, obviously we have good clinical data to-date. We’ve been approached about running trials in Pancreatic Cancer; Liver Cancer is another natural fit because of the tie-in with HCV; Colorectal Cancer, NSCLC, Ovarian Cancer – we’re basically getting requests, almost on a weekly basis now, for diff. trials that investigators would like to run.
So, we’ll probably run a combination of some company-sponsored studies, in addition to the 2 big NSCLC studies, and Investigator-initiated studies.”
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SK 3-17-10, Slide16: “…As Cotara is infused directly into the tumor it binds with the necrotic core of the tumor, and from that point it basically irradiates the tumor from the inside-out. In fact, if you look at data presented last year, we’re able to deliver 300x more radiation to the tumor than to any of the normal tissues, so you’re concentrating that radiation right where you want it. In addition, probably the most promising thing about this program is the long-term survivors we’ve seen – in fact, some of the very 1st patients we treated in the 1st clinical study are still alive, with confirmed GBM, 9 years after treatment – that’s really outstanding in this patient population. If you look at the Phase II experience, an earlier Ph.2 completed study as well as interim data from the 40-pt Ph.2 study we have ongoing, we’re seeing about a 38-40 week survival time – again, this is a patient population which has a very consistent 24-wk MST, so a 38-40-wk MST is fantastic. What’s important about that is than none of the drugs that are currently on the market have moved that MST at all. So, if we can really show these results in a Ph.3 study, we think this is definitely going to be exciting. Our goals are to complete the expanded 40-pt Ph.2 study toward the middle of this year, and then to work with the FDA to evaluate possible registration pathways – to determine what that trial would look like, and can we get it to a manageable size that we can potentially even run it ourselves. At the very least, once we have a clear registration pathway, this product becomes much more partnerable, because then the partner will understand exactly what the pathway to registration is…”
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SK 3-17-10, Slide18: “We have a profitable CMO, Avid Bioservices. We’ve seen very nice, consistent growth over the past few years. If you take a snapshot of the company over the last 12mos. ended 1-31-2010, our last qtly reporting #’s, Avid provided about $32mm in services. What’s important here is these $32mm in services are all positive, no matter which of the 3 areas they fall into. Obviously, 3rd party work, $15mm over that time period, is important because it brings in revenues to help offset our overall burn rate. The same with the Gov’t Contract work, it’s one of our sub-contractors on our Gov’t Contract – that was another $8mm in services. And about $9mm in services for Peregrine, as we were building inventory, doing scale-up work, and preparing for the later-stage clinical trials. Again, this organization is a commercial mfg. facility since 2005 – we have 2,400L of capacity, and we believe this facility has adequate capacity in which we could potentially launch Bavi out of the facility. Of course, if Bavi is as successful as we believe it could be, we would need to expand the facility and potentially expand it beyond our existing space, so we believe we do have adequate capacity with very minor facility modifications to meet that commercial launch.”
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SK 3-17-10, Slide19: “…this [5-yr, $44mm DTRA/TMTI Contract] is to study Bavituximab and a human antibody as potential treatments for VHF infection. This is really 2 things for us. One, it was a great validation of technology. The gov’t actually went out & sought out the most-promising broad-spectrum anti-virals which they felt had potential in VHF, they contacted us and actually asked us to apply for this contract, because they really liked the technology platform. So far, we’ve recognized ~$18mm in revenues thru Jan.2010. This is a very positive contract – it covers overhead & G&A expenses, and actually directly supports Bavi development, so as part of this contract we’re doing scale-up work, cell-line work, formulation work that we otherwise we would be taking on ourselves. So, it’s a real benefit all the way around for the Company.”
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SK 3-17-10, Slide21: “On the financial side, we just reported #’s last week. Essentially we’ve had a very nice trend of increasing revenues, declining net loss. If you look the 1st 9mos. of this FY, we had $23mm in total revs, and over that entire 9mo. period, about a $5.5mm Burn – so a very lean burn rate at a time when we were running up to 7 clinical studies and advancing our promising pipeline of products. As of 1-31-10, we had $16.8 in Cash & Cash-Equiv., liquid assets of almost $20mm… We have available financing options – we have a $50mm shelf in place with $38mm available. Of that 50, 25 were put into an At-The-Market Issuance program which we utilize as the Market conditions are favorable for that vehicle – currently $13mm of that $25mm left. We have a nice, clean capital structure – about $51mm shares O/S, 300k warrants, and no convertible debt – just a straight $3.8mm term loan.”
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SK 3-17-10, Slide22: “At this stage, Upcoming Milestones: We plan on announcing data from up to 5 clinical trials from now up to the middle of the year, primarily at the AACR [Apr17-21] & ASCO [June4-8] Conferences, initiating 2 new randomized Bavi NSCLC studies by the middle of this year, completing enrollment in the ongoing Ph.2 Cotara GBM trial which should put us in a good position for data toward the end of this year. On the operational side, we’re looking to continue expanding the Avid commercial business, as well as starting some new initiatives to take advantage of the fact that we have a commercial GMP Mfg. Facility in the U.S. – these opportunities include things such as Biosimilars, either for our own dev. efforts or thru partnerships with other interested parties. With that, I’d like to thank you all very much.”

Q&A #1: PLEASE DESCRIBE YOUR PARTNERING STRATEGY GOING FWD?
SK: “For the Cotara pgm, certainly as we complete this Ph.2 study, that’s going to give us a really nice data set to go to the FDA with. At that point, we’ll determine what size of the trial we can negotiate for the Ph.3 study, and at that point I think it’s a very partnerable program, and we’ll have a lot of value built into it. Depending on the size of it, we could run it ourselves, but that would be an ideal partnering time for that compound. On the Bavi side, we view that as being the potential Home-Run for the company – the big value-driver. Our goal is to certainly maintain U.S. rights as long as we possibly can. There is a lot of partnering interest – novel monoclonal antibodies with broad-spectrum potential clearly fits into a lot of people’s pipeline plans. The possibilities are ex-U.S. partnering to bring in the needed cash, even potentially allowing us to run the Ph.3 studies. We’re evaluating all those opportunities. Also, we want to make sure it’s a good strategic fit, really filling in the gaps where we don’t have the expertise.”

Q&A #2: POSSIBLE TO SPLIT BAVI CANCER VS. VIRAL FOR PARTNERING?
SK: “There aren’t too many partners who have big virology pgms and big oncology pgms, that’s certainly true. We do think it’s possible to split the indications. We’re right now evaluating some ways to do that. Some of the things that could allow us to do that could be formulation work, could be mechanisms of delivery, so there are a lot of diff. ways to go about splitting indications. But, the key would be to make sure the economics make sense at the end of the day and that pricing-wise we’re in the same ballpark for both indications.”
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