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

Thank you, operator. Welcome, everyone. Thank you for joining us on our third quarter 2024 results conference call. Earlier today, we issued a press release, a copy of which is available in the Investor Relations section of our website. It was also filed as a 6-Ks. I'd like to remind you that certain statements we make during the call will be forward-looking. Because such statements deal with future events, and are subject to many risks and uncertainties, actual results may differ materially from those in the forward-looking statements. For a full discussion of these risks, and uncertainties, please review our annual report on Form 20-F and our quarterly reports on Form 6-K that are filed with the U.S. Securities and Exchange Commission. At this time, it is now my pleasure to turn the call over to Phil Serlin, Chief Executive Officer of BioLineRx.

Thank you, John, and good morning, everyone. And thank you for joining us on today's call. I'll begin this morning with a recap of the significant licensing agreement that we announced last week with Ayrmid Limited, followed by a review of our third quarter performance, and then Mali Zeevi, our Chief Financial Officer will briefly recap our financials. Afterwards, we will take your questions. Ella Sorani, our Chief Development Officer is also available for Q&A. Last week, we announced that we executed an exclusive license agreement with Ayrmid Limited, the parent company of Gamida Cell Limited for motixafortide, which is sold in the U.S. under the brand name, APHEXDA. Recall that APHEXDA is our FDA approved and commercially available stem cell mobilization agent indicated in combination with G-CSF for the collection and subsequent autologous transplantation in patients with multiple myeloma. The agreement covers all indications with the notable exception of solid tumors like pancreatic ductal adenocarcinoma or PDAC and all territories with the exception of Asia, where we previously entered into a license agreement with Gloria Biosciences for motixafortide in that region. This transaction is very beneficial for BioLineRx with a $10 million upfront payment, $87 million in potential commercial milestones and very healthy royalties of between 18% and 23%. In addition, we received another $9 million in the form of an equity investment from Highbridge Capital. This aggregate cash influx has enabled the company to finalize an agreement with BlackRock to repay a significant portion of its outstanding debt and restructure the remaining debt on favorable terms. With the transfer of our commercial program to Ayrmid, Gamida Cell, we have also reduced our cash burn in a very substantial manner, with our cash runway now extending into 2026. And I will provide more financial details about this shortly. Lastly,…

Thank you, Phil. As is our practice, I will go over the most significant items in our financial statements, revenues, cost of revenues, research and development expenses, sales and marketing expenses, net loss and cash. I invited to review the 6-K filing we made this morning that contains our financials and press release. Total revenue for the three months ended September 30, 2024 was $4.9 million. The company did not record any revenue during the third quarter of 2023. Revenue for the quarter reflects a portion of the upfront payment from the Gloria Biosciences license, which amounted to $3.2 million as well as $1.7 million for the net revenue from product sales of APHEXDA in the U.S. Cost of revenue for the three months ended September 30, 2024 was $0.8 million. The company did not record any cost of revenue during the third quarter of 2023. Cost of revenue for the quarter, primarily reflects the amortization of intangible assets, royalties on net product sales of APHEXDA in the U.S. and cost of goods sold on product sales. Results and development expenses for the three months ended September 30, 2024 were $2.6 million, compared to $2.7 million for the same period in 2023. The decrease resulted primarily from lower expenses related to the termination of the development of AGI-134 and the decrease in payroll and share-based compensation. Sales and marketing expenses for the three months ended September 30, 2024 were $5.5 million compared to $8.1 million for the same period in 2023. The decrease resulted primarily from lower expenses of commercialization activities related to motixafortide. The higher expenses in the corresponding period of 2023 reflect the ramp-up of pre-commercialization activities related to motixafortide. General and administrative expenses for the three months ended September 30, 2024 were $1.4 million compared to $1.5 million for the same period in 2023. The decrease resulted primarily from small decreases in a number of G&A items. Net loss for the three months ended September 30, 2024 was $5.8 million compared to a net loss of $16 million for the same period in 2023. The net loss for the 2024 period included $0.8 million in non-operating income compared to non-operating expenses of $3.1 million for the same period in 2023, both primarily related to non-cash reevaluation of warrants. As of September 30, 2024, the company had cash, cash equivalents and short-term bank deposits of $29.2 million. Following the out license to Ayrmid the equity investment from Highbridge and the debt prepayment of BlackRock, the company's cash, cash equivalents and short-term bank deposits are expected to be approximately $20 million, which we believe will be sufficient to fund operations into ‘26 as currently planned. And with that, I'll turn the call over to Phil.

Thank you, Mali. In closing, I would like to take a moment to summarize our revised milestones. Over the next two quarters, we anticipate adding three new clinical trial sites to the ongoing CheMo4METPANC Phase 2b randomized clinical trial in first-line PDAC sponsored by Columbia University, and anticipate interim data in 2026. Working with Gloria Bio, we look forward to continued progress with the planned stem cell mobilization bridging study and the Phase 2b combination study evaluating motixafortide in first-line pancreatic cancer. Finally, in 2025, we will evaluate additional early-stage clinical assets for in-licensing and further development, seeking to add one new asset in 2025 and an additional one in 2026. With that, we have now concluded the formal part of our presentation. Operator, we will now open the call to questions.

Thank you. Ladies and gentlemen, at this time, we will begin the question-and-answer session. [Operator Instructions] The first question is from Joe Pantginis of H.C. Wainwright. Please go ahead.

Hey, everybody. Good morning. Good afternoon. Got a few questions, if you don't mind. So first, Phil, I just wanted to make sure I heard you correctly with regard to pipeline growth. Did you say potential in-licensing of one asset in '25 and one in '26?

Yeah. I think that's what our plan is. We have a number of assets that we're already looking at. It's hard to say, BD things don't always go exactly according to plan. But I think overall, that's our plan.

No, of course. Okay. So then going to your current announcements, and thank you for all the details today that were very helpful. With regard to, say, the pancreatic program. I guess, how do we mix that with the potential for motixafortide in additional solid tumor indications, plus the ability to potentially have a business development discussions around that? Can you discuss the level of maturity of these discussions?

Yeah. So, as far as the PDAC, I think that we look at PDAC as sort of, as a prototype, so to speak for other solid tumors. We are probably not going to put a lot more money at this point into PDAC. As you know, we have the two collaborations that are ongoing that are really running in the background with -- at a very low cost to the company, basically drug, the supply of drug product. And so, we think the best use for our current capital is to bring some new assets into pipeline while these programs are still ongoing. And we hope that there will be some initial data sometime next year -- I'm sorry, next in 2026, some interim data from the Columbia study, which then would serve as probably the launching off point for some potential business development discussions, etc.

That's very helpful. And then, with regards to the APHEXDA sale, a couple of things here. So just from a logistical standpoint, do they have any potential option on the solid tumor program?

They do not.

They do not. Okay. That's simple enough. And I guess two things here. So with regard to the company restructuring, it sounds like that it's mostly or largely the field force that they'll be assimilating?

Not necessarily. I mean, I don't think we're going to -- liberty to tell you to speak for them. But they have -- they are taking a piece of our organization or a number of our personnel. And I don't think it's only limited to field to customer-facing employees.

Okay. And then my last question is, I guess, from a financial standpoint and the important details you shared with regard to the drug launch to-date. How should we sort of view to the level of detail you can, sort of, the integration time within their program of APHEXDA and how that might impact any potential lags or dips in sales, especially, as we go into the first quarter and insurance resets, etc.?

Yeah. So I mean, I'm hoping that there won't be too much of a lag in anything. I mean they're taking, like I said, a significant number of employees with them. We’re also according to the agreement, we’re providing them with transition services for the next number of months. And so we think we’re going to ASH. We’ll probably going to Tandem as well. So I think that we believe that the transition period should be quite seamless. And I don’t believe there will be a significant lag in sales or in the uptick of sales.

Thank you very much.

All right, Joe. Have a great day.

The next question is from Justin Walsh of Jones Trading. Please go ahead.

Hi. Thanks for taking questions. I wonder if you can provide some color on where you view the company's core competencies as we wait to hear more about the addition of potential assets to your pipeline?

Thanks, Justin. Good morning. So I mean, as we mentioned, we'll be returning to our roots as an Israeli-based development company. But with many -- I think that we have many positive attributes that other companies may not have. We have a highly experienced development team, with fully validated capabilities from early-stage projects all the way to approval and of course, commercialization, but I'll just talk about until approval. So those are some of our capabilities. We have full -- our Israeli team has full capabilities in regulatory affairs and CMC, and quality assurance, in clinical operations in preclinical development, etc. So I mean, we've got in medical affairs and etc. So we've got a full complement of the disciplines necessary to move forward in development. I think if you just even to go further with that, I think that we also have cash flows from two partnering arrangements that will provide commercial milestones and royalty revenues on an ongoing basis that other development companies might have. And we also have, as I mentioned, we have the significant trials in PDAC that are ongoing under these meaningful collaborations that are really forward at a de-minimis cost to the company. So I think all-in-all, I think that we feel that we're very well placed moving forward. And again, as I mentioned, we're looking to bring in at two new assets in the 2025, 2026 period. We have a list of potential in-license candidates. All of them sort of meet our criteria of a low upfront payment in oncology and rare disease with relatively modest and affordable clinical development program. So I mean that's sort of how we see ourselves moving forward. I hope that gave you a comprehensive answer to your question.

Yeah, definitely. Thanks for taking the question.

Great.

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

Thank you and hello, Phil and Mali. Looking at the 2025 expenses. I think you indicated there would be a 70% reduction in spend next year. And I guess if we look at kind of the estimates out there, it seems like we just took out sales and marketing expense and leave R&D and G&A kind of as they have been -- is that a fair way to look at it? And also, obviously, take out the cost of goods sold as well.

I think it's going to be a little bit more than that. I think we're going to -- as a company that also had operations in the U.S. besides the actual U.S. commercial operations, I think that some of our spend from Israel, having a U.S. subsidiary that was active, created some additional spend. So I think it's a little bit more than that. I think you can expect a decrease in G&A expenses as well and etc. So we're looking to be lean and mean going forward. And as I said, we believe that we will be on the right track with moving forward with development only in Israel. Again, I think I also want to mention that Israel itself is sort of a low cost place to have development and so I think that we are looking at over 70% reduction overall in the spend.

Okay. And then on the R&D side, should we think of that kind of continuing on at the same level? And what are those obligations going to be? I mean, I think there's PDAC in there. Is there anything else in there that's ongoing?

Yeah. So we are -- we have some obligations regarding some five year commitment, post-marketing commitment with the FDA, but that's not very significant. And as well our PDAC commitments are more -- our drug supply plus some small grant, nothing significant. So I mean, we're going to be having two PDAC -- two Phase 2b studies, hopefully ongoing at almost no cost to the company. The post-margin commitment will be quite low. And then the rest of our spend will be on new projects as we bring them in.

And as we look at potentially a pivotal or registrational trial in PDAC. I guess you seem to indicate that, that would be taken over by partners and that you would probably have limited contribution there?

Yeah. I mean, listen, everything is possible, but I think we believe that something of this size in solid tumors in general, it would make sense to partner, especially have very robust data from the Phase 2b -- or from the Phase 2b. So I think our probably -- our main path we forward would be to look to partner it out and this being such a blockbuster indication, we don't really think that it would be difficult depending, of course, on the data.

Okay. So that seems to orient your attention more towards earlier stage products. So I guess, how would you think about adding a new product? I mean, what stage of development would it be in? I think oncology probably is an area where have some experience. How would you -- time to commercialization stage development indication? What are those kind of factors that you're thinking about when you're looking at something to layer on?

Yeah. So I mean, I said I think we're looking at oncology rare disease, we're looking at early-stage clinical assets. I can't say that that's the only thing that we'd look at, maybe something very, very late stage, pre-clinical but I think our focus is primarily on early-stage clinical assets site with best-in-class potential. And with small molecules, peptides, things that we have a lot of experience with previously and to sort of leverage our capabilities going forward.

Okay. And then on China, it seemed like you had mentioned that there's a clearance there, I guess, in some areas that don't require the bridging study. When would you expect the first revenues to show up from that region?

That's hard to say. I mean, it could -- it's hard for us to say right now, and we haven't given any guidance on that. We're hoping that 2025 will be a year where there is revenues, although we do have a lot of -- we don't have a lot of control over what's going on, what Gloria is doing. We are obviously meeting with them on a regular basis. I would imagine that, that first sale should occur sometime in 2025.

Thank you so much.

All right. Great. Thanks so much.

[Operator Instructions] A follow-up question from John Vandermosten of Zacks. Please go ahead.

Great. Thanks for one more. On Gamida Cell, obviously, the only other product that they're commercializing the omni-search (ph) product or do they have something else to be I think.

I think right now, that's what they have. I think they may have plans to bring in some additional products. But right now, they have omni-search of course, now they have APHEXDA.

Okay. Great.

There are no further questions at this time. Before I ask Mr. Phil Serlin to go ahead with his closing statement, I would like to remind participants that a replay of this call is scheduled to begin 2 hours after the conference. In the U.S., please call 1 (888) 295-2634. In Israel, please call 03-925-5904. Internationally, please call 972-3-925-5904. Mr. Serlin, would you like to make your concluding statement?

Yes. Thank you, operator. In closing, we are very pleased to have entered into this license agreement with Ayrmid Gamida Cell, which allows us to return to our drug development routes, while simultaneously benefiting from APHEXDA’s long-term commercial potential in stem cell mobilization, sickle cell disease and other non-solid tumor indications. We believe this path forward best positions us to create value for our shareholders while developing novel new therapies for patients with cancer and serious rare diseases. Thank you all very much for your continued interest in BioLineRx. We look forward to providing our next comprehensive quarterly update in March. Be safe, and have a great day.

Thank you. This concludes the BioLineRx third quarter 2024 conference call. Thank you for your participation. You may go ahead and disconnect.