Analyst Conference Summary

conference date: August 16, 2018 @ 5:30 AM Pacific Time
for quarter ending: June 30, 2018 (Q2, second quarter 2018)

Forward-looking statements

Overview: Continues clinical development, with VB-111 for ovarian cancer in a Phase 3 trial.

Basic data (GAAP):

Revenue was $0.2 million, up sequentially from $0.1 million, and up from $0.0 million year-earlier.

Net loss was $4.1 million, up sequentially from a loss of $7.2 million, and from a loss of $4.9 million year earlier.

Diluted loss per share (EPS) was $0.13, up sequentially from $0.24, and up from $0.18 year earlier.

Guidance:

Has cash sufficient for 3 years of operations.

Conference Highlights:

Dror Harats, M.D., CEO of VBL Therapeutics said "We continue to have high conviction in the promise of VB-111 and are focused on executing the ongoing Phase 3 OVAL trial, evaluating VB-111 in platinum-resistant ovarian cancer. We plan to conduct an interim efficacy analysis of this trial in the fourth quarter of 2019."

The Phase 3 trial of VB-111 with chemotherapy in platinum-resistant ovarian cancer continued enrollment. 350 patients will be enrolled. VB-111 has orphan drug designation in this indication. There will be an interim analysis in Q4 2019.

VBL has a license agreement with NanoCarrier for VB-111 in Japan.

During Q2 raised $15.5 million ($13.8 million net) with a direct stock offering.

Has a strong preclinical pipeline. The MOSPD2 program goal is to file an IND in Q4 2019 to start clinical trials. VBL will present more preclinical data on VB-600 MOSPD2 platform at the European Committee for Treatment and Research in Multiple Sclerosis (or ECTRIMS) conference on October 11th in Berlin. Also is developing a bi-specific antibody with MOSPD2 as one target; data was presented at the AACR meeting.

A new gene therapy manufacturing plant was opened in Modiin, Israel.

The previously announced failure in the VB-111 glioblastoma GLOBE trial may have been impaired by the treatment regimen agreed to under the SPA, as no other risk factor can explain the Phase 3 failure after the positive Phase 2 trial [WPM: except a random false positive or random false negative]. More analysis will be presented in November 2018 at the Society for Neuro-Oncology meeting.

Cash ended the quarter at $58.5 million, up sequentially from $49.9 million, due to the stock offering mentioned above.

Cost of revenue was $0.1 million. Gross profit $0.1 million. R&D expense $2.9 million. SG&A $1.4 million. Operating loss $4.2 million. Other expense $0.1 million.

Q&A:

Ovarian trial interim analysis? Not event-driven, time after 60 patients recruited and randomized. Will get CA125 and difference between the two arms. But blind to us, except the difference, so no alpha penalty. For full trial endpoints are PFS and OS. But can stop the trial early if we meet the primary endpoint.

MOSPD2 program timeline? We are still optimizing antibodies, then need to do toxicology.

MOSPD2 for multiple sclerosis? It is an exciting, novel program. We will be opportunistic regarding a strategic deal. In particular, we would like to partner outside of oncology indications.

Glioblastoma? We hope we can show data that will shed light on the diffence between Phase 2 and Phase 3 outcomes. New data on Avastin is also shedding some light on the issue.

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