Earnings Labs

Lantern Pharma Inc. (LTRN)

Q3 2022 Earnings Call· Mon, Nov 7, 2022

$2.20

-10.77%

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Transcript

Panna Sharma

Management

Thank you, Nicole. Good afternoon, everyone. And welcome to our third quarter 2022 earnings call. Thank you for joining us this afternoon to hear about our third quarter results and corporate progress at Lantern. Lantern Pharma is at the leading edge of leveraging artificial intelligence, machine learning algorithms, biomarker, clinical, genomic and drug response data to transform the costs, compress the timelines and derisk oncology drug discovery, as well as oncology drug development. We're actively using this transformative approach, which leverages AI through our own RADR AI platform. We use this to uncover significant opportunities in cancer opportunities that are either underserved, unmet or often overlooked. We've advanced and rescued compounds bring them to Phase 2 clinical trials, and also have developed entirely new drug candidates for first in human trials next year. We're doing this at a fraction of the cost and timeline of traditional drug development. Our unique AI platform is powered today by more than 25 billion data points and over 200 algorithms. These are the foundation of what helps us to understand, predict and model questions that are fundamental to oncology drug development. We're advancing two drug candidates that are in Phase 2 clinical stage and expect to launch two additional drug candidates early next year. Those first in human trials will be with LP-184 and LP-284. Both molecules can be synthetically lethal in certain cancers, LP-184 specifically in solid tumors while LP-284 is directed at a range of blood cancers, specifically non- Hodgkin's lymphomas. We've also been focused on advancing our rescued drug candidates, LP-100 and LP-300 towards precise and meaningful treatment indications in unique patient populations. We also have several therapeutic programs that we expect to introduce in the coming quarters with both our existing molecules and with new molecules and new combinations that…

David Margrave

Management

Thank you, Panna and good afternoon, everyone. I will now share some of the financial highlights from the third quarter. Our R&D expenses for the quarter ended September 30, '22 were approximately $0.7 million compared to approximately $2.96 million for the third quarter of 2021. A substantial portion of this decrease in expenses relates to $935,000 payment we received in July ‘22 from one of our service providers in connection with the resolution of a difference of views regarding the service provider agreement. This payment we received contributed to an approximately $1.6 million reduction in product candidate manufacturing related expenses during the three months ended September 30, 2022. In addition, we made a $1 million upfront payment to Allarity Therapeutics during the three months ended September 30, 2021, which was nonrecurring, so that expense did not occur again in the quarter ended September 30, 2022. General and administrative expenses were approximately $1.4 million for the third quarter of 2022, up slightly from $1.2 million in the prior year period. We recorded a net loss of approximately $2.3 million for the quarter ended September 30, 2022 or $0.21 a share. This compares to a net loss of approximately $4.1 million for the quarter ended September 30, 2021 or $0.36 per share. As of September 30, 2022, we had approximately 10.86 million shares of common stock outstanding and outstanding warrants to purchase approximately 178,000 shares and outstanding options to purchase 1,000,953 shares. These warrants and options, combined with our outstanding shares of common stock, give us a total fully diluted shares outstanding of approximately 12.04 million shares as of September 30, 2022. Our cash position, which includes cash equivalents and marketable securities, as of September 30, 2022 was approximately $57.8 million. This balance is expected to carry us into 2025. Importantly, we believe our solid financial position will fuel continued growth and evolution of our RADR AI platform, accelerate the development of our portfolio of targeted oncology drug candidates and allow us to introduce additional targeted products and collaboration opportunities in a capital efficient manner. Lantern currently has 17 employees who are primarily focused on leading and advancing our research and drug development efforts. We see this number expanding slightly in coming quarters as we add additional experienced and talented individuals to help advance our mission. I'll now turn the call back over to Panna for some final comments. Panna?

Panna Sharma

Management

Thank you, David. As David mentioned, we're well positioned and are executing on our ambition to leverage AI and data in a highly cost efficient manner to generate clinically needed programs in cancer therapy. We continue to have a strong financial fiscal discipline with our cash utilization, most of which is spent on external research, manufacturing and trials. Our focus remains on leveraging our intellectual knowledge capabilities around scientific strategy in the AI platform and then working with world class partners and CROs to execute on those needs. This enables us to scale the work as needed and rapidly adjust as our data or the markets dictate. We believe this nimble model can be a hallmark of future drug development that's both efficient and derisked. Later this quarter and this year Lantern will be presenting new preclinical data at several scientific conferences, including the Society of Neuro-Oncology’s Annual Meeting in Tampa, that's coming up in the 16th through the 20th, the San Antonio Breast Cancer Symposium in early December, we're presenting some exciting new data and the American Society of Hematology, ASH in New Orleans in mid-December, where we'll be talking more about 284. We’ll also be attending BioFuture Conference this week in New York and the Disruptive Growth Conference in New York also in early December. Ultimately, we believe many of our programs, as they further develop, can be partnered out for several hundred million or potentially even billions of dollars in addition to providing multiple shots on goal, our maturing development pipeline with two Phase 2 assets, the upcoming launch of multiple Phase 1 trials and additional assets under development, should provide a steady flow of catalysts, news and data moving forward to track an increasing level of interest from both investment communities and biopharma companies. With the extraordinary potential ahead of us, we continue to believe our current market cap and price does not accurately reflect the true value of our development programs and our AI technology platform for oncology drug development. We're actively pursuing and continue to pursue activities to increase our visibility at Lantern Pharma with the right sets of investors and also to engage with larger global biopharma companies to explore partnering one or several of our programs. I believe we've crossed an important inflection point in our business with our platform. And now having repeatedly proven its capabilities of delivering important insights to expand our pipeline and to aid in the development of others pipeline, we've ushered in a new era for a company. We are now leveraging AI driven insights to get to cancer patients in a more effective and efficient manner. I want to thank everyone for their time today and interest in Lantern on this call. And I'll now open up the call to questions.

A - Nicole Leber

Management

[Operator Instructions] We have a few questions coming in here. One from John Vandermosten. Do we need an entirely new IND for each indication for LP-184?

David Margrave

Management

No, we're not expecting that. We think we can develop this under the same IND.

Panna Sharma

Management

Well, different protocols potentially for the trials for the IND would be one.

Nicole Leber

Management

And I see here, Michael King is raising his hand. Michael, go ahead and ask your question.

Michael King

Management

Several questions, I'll try to keep it brief. Just in general, could you talk a bit about 184 since it's got so many potential indications? How do you foresee making specific go no-go decisions for the various indications in the CNS, including pediatric? How are you going to prioritize the different indications?

Panna Sharma

Management

First, we will probably have a multi tumor trial in 184. And from that Phase 1 or Phase 1a data, we’ll probably enrich for Phase 1b or 2, based on the tumors that are most responsive. We'll also, during that trial, gather information about large scale information about the DNA damage response profile and also [PTGR1] levels as well. And so we'll enrich from that initial Phase 1, 1a, 2a more targeted 1b to 2 trial. And so I expect we're going to probably enroll in lots of solid tumors now. That solid tumor will give us some good dosing information as well and allows us to get the safety data that we want. And from that, we'll probably launch them to Phase 1 in CNS cancers. And again, very similar to Phase 1 for solid tumors, we probably will enroll the majority of recurrent CNS cancers and then enrich in GBM, and some of the more response -- malignant gliomas that we've seen are more responsive. So we're going to allow patient data and real clinical data to guide the downstream selection. But we have some good ideas already where we think the most responsive tumors will be. And we'll pursue those first, are they the most responsive, is there a clinical need that's clear and can we get through trials in a rapid way. But yes, there's a lot of -- that's why we think 184 is such an exciting molecule.

Michael King

Management

And can you remind me, Panna, you're not going to prescreen patients for their PTGR expression, right, but you'll do some kind of a post hoc analysis, or how’s that actually going to work?

Panna Sharma

Management

That's the current thought that we won't select based on PTGR1 levels initially, but we're still looking -- we're still in discussions with KOLs and looking at feedback, but we may preselect based on DNA damage response mutation profile though. So if someone has a -- whether it’d be homologous repair deficient or nucleotide excision repair deficient, that might be the criteria across all solid tumors.

David Margrave

Management

And in later stage trials, we very well could use the PTGR1 as a selection eligibility criteria as well.

Michael King

Management

And then just one more quick question. Just as far as strategic imperatives are concerned, you said in the formal remarks and in the press release that you're in start introducing perhaps some more novel compounds or new compounds into the pipeline and novel combinations. I just wonder, how much can you keep filling up the front of the funnel, so to speak? Because are you going to get limited on bandwidth? You could potentially have five different trials on 184 alone, then you've got 284, 300, 100. So it's filling up the front end of the funnel at this point in time really the priority, or would you rather see some flow through into the clinical advancement of the pipeline compounds?

Panna Sharma

Management

Yes, the clinical advancement is clearly our priority. So -- but there are a lot of new ideas and advancements that are being made that we’ll very likely announce with partners. So you're right on, there's only so many trials that we can handle alone. But we do have some interesting things that we're like to develop, but probably will develop with a partner faster. But our current priority is the clinical advancement of that, that we’ve talked and we’ve talked about that first. But I don't want investors rather so forget this -- this is also a platform, the amount of new content that's coming out is at a rate that's only getting more precise and larger. And so that was our hope as we grew the platform, and I think that's beginning to be an opportunity for us to partner and so that's why we raised it. But clinical advancement of the existing compounds is the number one priority.

Nicole Leber

Management

We have another question coming in here. What are the first observations on screening success for the Harmonic trial?

Panna Sharma

Management

We're in the process of screening, probably half a dozen to a dozen patients. So we won't know until we've started the dosing process. But yes, we've got probably six to 12 patients that are being…

David Margrave

Management

That are in the likely stage.

Panna Sharma

Management

No observations yet.

Nicole Leber

Management

[Operator Instructions] I see John Vandermosten is raising his hand. John, you should be able to ask your question.

John Vandermosten

Management

I thought it was really interesting that you had noted about taking the liquid biopsies over the course of the trial, and wonder if there was any precedent for that? And if so, any observations and then might that also be useful for conducting some kind of adaptive trial design in the future?

Panna Sharma

Management

Yes, like I said in the comments, the liquid biopsy, probably one of the largest longitudinal studies on the same patients in never-smokers. So what happens now in these never-smoking population is that they're typically, if they have an actionable mutation, they're given a range of TKIs. Some stop responding in a few months, some take two three years. If they're EGFR, they might mutate to T970M, which you can be on that drug also for a year or two. So my expectation is that the cancer genome will be pretty different across these never-smokers. There’ll probably be some subtle variations based on the drug history -- treatment history that they've had. And so I think that we may expect different levels of response to the LP-300 plus chemo doublet based on the clinical treatment history. And so that'll allow us to really pinpoint who's going to be the most responsive. And if there's a signature that comes out of it, we can use that signature regardless of never-smoking status, and we may then have a pivotal Phase 3 would based on that signature. It'll advance our understanding of never-smoking cancer biology in general, but I think it will be very helpful into creating a more focused and even narrower trial and it'll also help us with pharma partners, because pharma partners, of course, ask the same question, why do we have a range of variability in response, can you tell us what you're seeing. It may or may not correlate with their prior clinical treatment, but I think we'll find a lot of really good insightful data in the liquid biopsy that we collect.

David Margrave

Management

And I think, very exciting aspect of this is the de-identified data will then be included and incorporated in RADR, which will make that even more powerful.

Panna Sharma

Management

And just to add on to that, we will be doing liquid biopsy at enrollment and multiple time points wherever possible in all of our trials. So it'll be pretty standard. So we'll do them in the GBM trial, we'll be doing it on the solid tumor trial for 184, we'll be doing it on the 284 trial, because it just -- there's a wealth of data, the costs for liquid biopsy have gotten much more reasonable. And if patients are amenable to it, in which many cases they are, it gives us a lot of very clear ideas of how to advance the molecule.

Nicole Leber

Management

That is all the questions I see that we have for today. So thank you, everyone, for joining and have a great rest of your day.

Panna Sharma

Management

Nicole, thank you. David thanks.

David Margrave

Management

Thanks a lot. I appreciate it. Bye-bye.