Analyst Conference Summary

conference date: August 14, 2020 @ 8:00 AM Pacific Time
for quarter ending: June 30, 2020 (second quarter, Q2)

Forward-looking statements

Overview: ThermoDox highly likely failure. GEN-1 for ovarian cancer started its Phase 2 trial.

Basic data (GAAP):

Revenue was $125 thousand, flat sequentially from $125 thousand and flat from $125 thousand year-earlier.

Net income was negative $8.1 million, down sequentially from negative $5.3 million, and up from negative $5.5 million year-earlier.

EPS was negative $0.24, down sequentially from negative $0.18, and up from negative $0.25 year-earlier.

Guidance:

none

Conference Highlights:

Michael H. Tardugno, Celsion's CEO, said: "Since the DMC finding that the OPTIMA Study crossed the futility boundary, albeit with substantial uncertainty, and leaving the decision to terminate the Study up to the Company, we have determined to continue following patients for overall survival (OS) until such time as futility is either confirmed or dispelled."

Cutting expenses, including some employees, from the Thermodox program, in order to continue with the GEN-1 program. Lossed from milestone liability and impaired R&D added to other expense and net loss in Q3 2020.

The OPTIMA Phase III study of ThermoDox plus RFA for liver cancer is fully enrolled and reported its second interim efficacy analysis in July, which was essentially a failure, though the patients continue to be followed. The DMC's analysis found that the pre-specified boundary for stopping the trial for futility of 0.900 was crossed with an actual value of 0.903. The p-value of 0.524 for this analysis provides a high level of uncertainty as to the actual hazard ratio value, therefore, the DMC left the final decision of whether to stop the OPTIMA Study to Celsion. Celsion announced plans to continue following patients for overall survival (OS): the decision is to follow patients to the final analysis at 197 or more deaths, a milestone expected to be reached in mid-2021.

Claimed that post second interim data moved the futility p-value back to the good side. Admitted statisticians would be dubious about such an analysis.

In September 2020 announced a common stock purchase agreement for the issuance and sale, from time to time, of up to $26 million of shares of common stock with Lincoln Park Capital Fund.

Began Phase 2 portion of OVATION 2 GEN-1 study in July 2020. Expects to complete enrollment in about 12 months, now using a synthetic control arm. In May 2020, the Company announced the final recommendations of the DSMB following completion of the Phase I dose-finding and tolerance portion of the OVATION 2 Study with GEN-1 in advanced (Stage III/IV) ovarian cancer. Based on favorable safety data from 15 randomized patients, the DSMB recommended that the Phase II portion of the OVATION Study proceed with the dose of 100 mg/m2. The DSMB also determined that safety is satisfactory with an acceptable risk/benefit, and that patients tolerate up to 17 doses of GEN-1 during a course of treatment that lasts up to six months. No dose limiting toxicities were reported in Phase 1.

ThermoDox plus ultrasound for breast cancer study was approved to start in the Netherlands in June 2019.

Cash and equivalents ended at $18.3 million, down sequentially from $25 million. Debt includes $7.1 million milestone earnout liability and $4.6 million in outstanding notes. Has an ATM and shelf registration to raise cash if necessary.

Total operating expense was $4.3 million,consisting of $2.5 million for R&D and $1.8 million for general and administrative expense. Interest and other expense net $0.4 million. Loss from milestone pay out change $1.1 million. Loss from impairment $2.4 million.

Celsion continues to pursue non-dilutive sources of financing.

Q&A summary:

Ex-US regulatory situation? If we have evidence we should continue from the CRO statisticians we will first meet for the FDA. We are trying to maintain blindness with investigators while studying efficacy results. If the FDA meeting is positive, we would meet with Chinese regulators, then EU.

Pandemic? We are seeing less patients reporting to hospitals with patients. But we believe enrollment will complete by mid-2021.

GEN-1 Phase 2 will have a real control arm and a synthetic control arm.

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