Processa Pharmaceuticals Inc Aktie

Hello, everyone. This is Craig Brelsford with RedChip Companies. Thank you for joining today's event with Processa Pharmaceuticals, which trades on the NASDAQ under the ticker PCSA. With us today, we have George Ng, CEO of Processa. We will begin with a brief presentation in a moment, and then we will answer your questions.

Before we begin, please allow me to read the safe harbor statement. This call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements pertaining to future financial and/or operating results, along with other statements about the future expectations, beliefs, goals, plans or prospects expressed by management constitute forward-looking statements. Any statements that are not historical facts should also be considered forward-looking statements. Of course, forward-looking statements involve risks and uncertainties.

I now turn this webinar over to George. Please go ahead.

Thank you, Craig. I appreciate the opportunity to speak -- meet with you all today. My name is George Ng. I'm the CEO of Processa Pharmaceuticals, again, NASDAQ traded company with a ticker symbol PCSA. And as Craig mentioned, I likely will be making forward-looking statements today. So please take note of that.

At Processa Pharmaceuticals, we develop next-generation cancer drugs. And we do so with a derisked approach to development. Unlike some of these other companies that have taken a high risk, but high-reward approach, we have decided to take a derisked approach in that we're not developing wholesale new therapies and treatments and drugs in that sense, right? We are taking current cancer therapies and drugs that have issues, and we make them better in that by developing our drugs to either work in concert or altering existing drugs and anticancer agents. We make them more effective as well as -- in terms of higher efficacy as well as better safety as well.

And so how do we do this? We do this by altering the distribution and/or metabolism of these current cancer therapies, drugs and anticancer agents. And we do this with using a proprietary regulatory science approach that our seasoned development team has used to the tune of 30 regulatory approvals to date, so very successfully. And this regulatory science approach is also compliant with the new FDA Project Optimus requirements that now require pharmaceutical companies to come up with an optimal dose for oncology drugs rather than just a maximum tolerated dose. Fortunately for us, while some other companies may be scrambling to comply with this new requirement, our development team has been doing this all along, including with our current drugs in our pipeline.

And despite decades of advancements and developments in the oncology space, there's still a huge high unmet need. Despite these developments, cancer is still the second leading cause of death. And so there is a need for better cancer drugs and therapies. And so in our pipeline, we currently have 2 oncology drug products, PCS6422 and PCS11T. As for PCS6422, what we do is our 6422 drug is given in combination with capecitabine, which is a well-known, widely used chemotherapy drug that has its issues. For example, 35% to 70% of all patients on capecitabine can't tolerate it. So doctors either have them go off of drug altogether or give them a lower dose of capecitabine, which is not optimal. And so what we do is when we give it in combination with capecitabine, we actually make it safer and also create higher exposure which -- to the active ingredient, which also makes it more effective. And our Phase Ib results, which we previously reported support this in that although it was a small study, we had a 67% response rate, which is very high.

As I may have mentioned previously, for regular capecitabine, only 20% to 40% of all patients respond depending upon the cancer indication. So we have a much higher response rate. And our progression-free survival is 3 to 11 months. And we even had a much better safety profile in that only -- for example, only 6% of all our patients actually came down with hand–-and-foot syndrome, which is the leading side effect for capecitabine. For example, for regular capecitabine or capecitabine given alone, about 50% of all patients come down with hand-and-foot syndrome with 20 to 30 patients coming down with severe hand-and-foot syndrome, which is -- where it's so severe that a patient can't grasp anything and they can't walk. In our case, we had no cases of severe hand-and-foot syndrome and only 1 mild case of hand-and-foot syndrome.

So we're excited about the results. And because of that, we actually initiated a Phase II study last August. So we're in the middle of that right now. It is a study that's meant to be done in 2 parts. So we are in the process of enrolling, treating the first 20 patients. And after 20 patients are enrolled and treated, we will do an interim analysis, and then we'll be able to release the interim analysis data. And so right now, we're on track to complete enrollment within the second half of this year and also release preliminary analysis results in that time frame as well.

As for our second drug -- sorry, oncology drug product, PCS11T, we basically altered SN-38, which is the active ingredient in irinotecan and Onivyde and a few other drugs as well. And the problem with irinotecan -- so we altered it to add a chemical transporter that preferentially draws in more of SN-38 into the tumor cell over surrounding healthy tissue. And the reason why that's important is that irinotecan and Onivyde and the other SN-38 drug products, they all have black box warning. So -- and that's a case where the side effects are so severe that they can be deadly, right? And so -- but by drawing in more of SN-38 into the tumor cell over surrounding healthy tissue, then we have less off-target effects and we improve safety, less side effects, less toxicities to the surrounding tissue. And so our goal is to try to remove part or all of a black box warning. And so far, from preclinical animal studies, we have shown that in both -- over both irinotecan and Onivyde, we preferentially draw in more of SN-38 than those drugs do. And so we're excited about that.

And aside from our 2 oncology assets, we also have 2 non-oncology assets that we have partnered or in the process of partnering and doing collaborations with. The first one is PCS12852, and it was a drug product initially developed for gastroparesis. We recently announced a deal that we did with Intact Therapeutics for an out-licensing deal and a collaboration with Intact Therapeutics. And the basic deal terms are that it was about $454 million in total deal value with about $2.5 million in near-term -- potential near-term payments and milestone payments. And then also, we received a low double-digit royalty as well. And we also even -- we also have included in the deal a 3.5% equity stake in Intact Therapeutics.

And why I'm really excited about that is the team there at Intact. They're experienced, and they are well known in the GI space, especially one individual who is a well-known researcher and expert in GI diseases, and in fact, was the co-founder and was the technological brains behind what was at one time the largest GI-focused pharmaceutical company in the world before it was acquired for billions by another company, right? And so with his involvement, we are very excited about the prospects, and we're confident that Intact and its team can move this asset through development. And so we're excited about that.

In terms of PCS499, we are fortunate that due to a recent change in regulation, we are able to pivot 499 back to the renal nephropathy space. where it was originally developed. But -- and in that the FDA is starting to allow a surrogate endpoint that is easier to meet. And since that time, about 4 or 5 drugs have been approved with this new surrogate endpoint, including one by Novartis and one by Travere. And why I'm excited about PCS499 is that from the data that's already been generated, we believe that we can go straight to a Phase III adaptive pivotal/registrational study. So that would -- and that would be the only study that would be required prior to FDA submission for approval. And so we're excited about that.

And so -- and we're also excited because out of the drugs that have been approved under the surrogate endpoint, they all have black box warnings. Our drug would be the only one, if approved, that would not have a black box warning. And so that gives us a huge advantage over these other drugs in the space, which is pretty hot right now. And so right now, we are in the process of designing and coming up with a Phase III adaptive study protocol. And so in the next few months, we plan to submit a pre-FDA meeting package to the FDA regarding the Phase III adaptive study, the proposed Phase III adaptive study, I mean. And we're hoping to get FDA feedback. And with FDA feedback, then we go from where we didn't really have much to now a Phase III-ready study drug. So that's why we're really excited about that.

And we're in the process of speaking and meeting with several potential partners for this drug. And in fact, I was just at the big bio conference, and we had over 30-plus meetings just on 499. So there's a lot of excitement around that. And we will begin the process of looking for a partner and negotiating with companies for a partnership for this and collaboration.

And so just in summary, I'm excited, and I think everybody should be excited about Processa because of 4 major reasons. One, again, we're taking a derisked approach. So we're not reinventing the wheel. We're not having to, unlike some of these other companies, show and prove that their drug works, we just have to show that current cancer drugs, we can make them work better in terms of making them more effective and safer. And so that's a lower bar and a derisked proposition.

And we have a seasoned management team with extensive public company experience. As I mentioned previously, we have a development team that has 30 regulatory approvals, and we have leadership that have been at other publicly traded companies and executed all the way through to meaningful milestones. And we also have multiple drug products with high potential in our pipeline. So we're not just one shot at the apple. We actually have multiple shots on goal.

And lastly, we have upcoming catalysts. As I mentioned previously, with PCS6422, we anticipate Phase II preliminary -- doing a Phase II preliminary analysis and issuing or releasing data in the second half of this year. And then we also have potential non-dilutive funding from partnering and deal payments and milestones from PCS12852 as well as from PCS499 pending a deal being done with that drug.

So I thank you for your time, and I appreciate you spending -- taking time out of your busy day to hear me speak.

Thank you, George. [Operator Instructions] George, we've already received several questions. One is this. You've presented abstracts at ASCO and have next-generation cancer drug candidates such as PCS6422 and PCS11T. Can you elaborate on the unique value proposition of these drug candidates and their potential market impact?

Yes. So again, with PCS6422, it's meant to be given in combination with capecitabine. And capecitabine is a very widely known and used chemotherapy drug that's used in first line, second line in many different patients. But again, it has its shortcomings. There's high toxicity levels associated with it. And there's also very severe side effects like with hand-foot syndrome. And so with our drug given in combination, if we can address those issues, it could be a game changer.

And then on top of that, there are a lot of potential patients that aren't prescribed capecitabine because of these side effects and toxicity levels that physicians believe that certain patient populations won't be able to tolerate them, like for example, with elderly patients. If we can make capecitabine a lot safer and even more effective, then we can reach patient population, in fact, even expand the patient population pool.

As 411T, as I mentioned previously, it has -- or products with the active ingredient SN-38 have black box warning. So if we're able to, as shown in preclinical animal studies, draw in more of SN-38 into the tumor cell, then that there's less off-target effects, less toxicities going to the surrounding healthy tissue. And therefore, if we can remove even part of the black box warning, then our key opinion leaders have told us that, that's a game changer as well. And I mean, if you're a physician, would you prescribe -- if you had a choice between 2 drugs, one that has a black box and one that doesn't, you would likely prescribe the one that has -- that does not have a black box or has less of a black box. So for those reasons, we believe that PCS6422 and PCS11T have a very high value proposition.

George, in your June 2024 announcement, you reported positive preliminary results from a Phase Ib trial in gastrointestinal cancer with 66.7% of the patients showing progression-free survival. Why did you choose to pivot to breast cancer?

That's a great question and an interesting one, and it stems from our interactions with the FDA. Again, we have this proprietary regulatory science approach that we've used with much success in other situations and with other drugs. So interactions with the FDA, we were able to elicit great feedback from the FDA, and they're encouraged by the data. And they actually were the ones that encouraged and supported us to pivot over to breast cancer because it is an easier path to possible approval, right, in terms of further development and also because it would be as a monotherapy. And therefore, once you have a drug approved as monotherapy, it can be used in combination with other drugs as opposed to the other way around. So it was for these reasons.

And then also because we do have -- there is prior published data with 6422 being used to treat breast cancer. So we have data also that helps support the pivot over to a breast cancer indication, which is a very large indication in terms of patients and patients treated. So it's for all those reasons why we pivoted over to breast cancer for our Phase II study.

Next question. The oncology drug market is highly competitive. How does Processa differentiate its next-generation cancer drug candidates from existing treatments? And what is your competitive advantage?

Yes. And I mentioned it previously as well. I mean, we take this derisked approach. Again, we don't have to show that our drug works. I mean, I came from an area and field of immuno-oncology where they would ask questions as simple as how do you know your drug actually gets to the tumor cell. We don't have to answer those questions here, right? We already know how current approved cancer therapies work, including chemotherapy, right? We know how they work. It's just a matter of we just need to show that we make them work better, and we make them safer to use and to treat. So that's a much lower bar. And so we believe that, that gives us a competitive advantage. And again, we have a very experienced management and development team with many regulatory approvals to date. And so we believe that those aspects are our advantages over a lot of other companies.

What is your current engagement with regulatory bodies such as the FDA? And what milestones do you anticipate in gaining approvals for your drug candidate?

Great. So as I mentioned previously, we have this regulatory science approach, and we've used it successfully in the past to interact with and negotiate with the FDA on various matters. And so currently, right now, we've used that approach with 6422, as I mentioned previously, in the pivot to breast cancer and successfully getting the FDA to agree with us on a Phase II study protocol.

So currently, right now, we're in the first part of our Phase II study enrollment and treatment of patients. And once we get to the interim, which is after 20 patients are treated. And the way this is set up is that 10 of the patients are on a low dose of capecitabine and 10 patients are on even a lower dose. So what I forgot to mention is in our Phase Ib study, we actually used a lower dose of capecitabine than what is normally used. And so the FDA wanted us to see, well, how low can we really go, right? And so that's hence why we have this first part where we treat 10 and 10. And then at the interim, we determine which dose to move forward with, and we will interact with the FDA at the time using our proprietary regulatory science approach.

And basically, from those interactions, we will determine with the FDA which dose to choose as well or to go with for the remainder of the study and how many more patients we will need to treat at that point in time.

And then with regards to 499, again, we're in the process of preparing our Phase III adaptive study protocol. And so we will request an FDA meeting and then interact with them in that way to get feedback from the FDA on the study protocol. And if they largely agree, then we will be able -- we will instantly have a Phase III adaptive study ready drug, which will be ready for partnership at that time.

Are you actively seeking or open to strategic partnerships with larger pharmaceutical companies to accelerate your drug development process?

Yes, it's pretty -- it should be pretty evident that we are open to partnerships. We -- and I mentioned the Intact deal for 12852 and our reasons for doing that deal. Turning now to PCS499. Again, it's pretty exciting because we went from nothing to now having a potential Phase III-ready drug. And so many companies are interested. And so we are talking to some of the major players in the renal and kidney space. And currently right now, some companies have moved on to even conducting due diligence. We have a data room set up and a separate pitch deck for PCS499.

And right now, we're exploring the deal pathway. We're also looking at potentially putting 499 in a wholly owned subsidiary and seeing if we might be able to raise money just for 499 into that wholly owned subsidiary. So we're exploring all of that. And so we are open to partnerships.

In addition, for oncology assets, we're also open to partnerships as well. That's part of the reason why we're moving our PCS6422 through to the end of Phase II because by that point, we would have generated enough data that we would then be in the position to do a meaningful partnership and/or collaboration.

And George, we have time for one more question today. Why should investors get excited about Processa right now?

Well, I mean, I think it's a good time. I mean I think -- I mean, I personally believe that we're undervalued. I mean I've put in my own money into Processa. So I believe in the company, I believe in the management team, I believe in the products. And I really like this derisked approach that the company is taking, right, to drug development, lower risk, higher potential reward. I like the fact that we have a seasoned management team with -- as I mentioned previously, with a development team that has 30 regulatory approvals under its belt. We have multiple drug products with high potential in our pipeline such that we're not -- one binary event isn't going to kill the company. We have multiple shots on goal. And so -- and we're going to continue to look for other ways to improve upon that as well.

And I think we also have upcoming catalysts, right, that are meaningful with PCS6422, the Phase II preliminary analysis and data that will be coming out. And then we have also potential non-dilutive funding from partnering and deal payments and milestones for PCS12852 as well as for 499.

Thank you very much, George. For more information on Processa Pharmaceuticals, reach us at 1-800-REDCHIP or e-mail us at [email protected]. Please visit the information page created by RedChip for Processa. It's pcsainfo.com. There, you can view and download the investor presentation and fact sheet and sign up for news alerts on Processa.

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Thanks again to our many participants today, and thank you very much, George.

Thank you. Appreciate it.