DelMar Pharmaceuticals, Inc.
President and CEO: Jeffrey Bacha
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WSA: Good day from Wall Street, this is Juan Costello, Senior Analyst with the Wall Street Analyzer. Joining us today is Jeff Bacha, the President and CEO for DelMar Pharmaceuticals, the company trades on NASDAQ ticker symbol is DMPI. Thanks for joining us today there Jeff.
Jeff Bacha: Thanks Juan, thanks for having me on again.
WSA: Certainly yeah, always good to have you on, and for some of our listeners that didn’t catch our previous interviews, can you provide us with an overview of DMPI?
Jeff Bacha: Sure, happy to do so. DelMar Pharmaceuticals is focused on oncology, so development of new cancer therapies. Our lead program is a chemotherapy that was originally a study at the National Cancer Institutes in the United States here. So we picked up the drug with a fair bit of clinical validations, demonstrating activity against various tumor types which we think really de-risks the asset. And our job is to really understand the mechanism of how the drug attacks the tumor using modern biological tools, and then leverage that historical and clinical activity to go into modern unmet needs. And the first place that we have chosen to focus is glioblastoma, which is the most common and aggressive form of brain cancer. Last year we completed a Phase II clinical trial and had a successful end to Phase II meeting with the FDA. So this year we are positioned to move that program into a pivotal Phase III clinical trial as well as to expand the focus into newly diagnosed glioblastoma and two other tumor types.
WSA: Certainly. And can you bring us up the speed on VAL-083 as you recently received funding from the Canadian Government?
Jeff Bacha: Sure. Well, as I mentioned our strategy is to leverage that historical clinical validation with research into the biological mechanism of action. And the way that we have been able to keep our costs manageable as we go through this process is to partner with leading academic institutions and leverage grant funding where we can. So we work with, for example MD Anderson, we work with the University of California and we also work with the British Columbia Cancer Agency and a lot of the work that we have been able to do with BC Cancer Agency has been supported through non-dilutive grant funding from the Government of Canada. We are very happy to report recently that we were able to continue that program and extend that program through some further funding.
WSA: Certainly and in terms of some your other activity there, you also had a patent allowance from the Patent and Trademark Office for key patent in Australia.
Jeff Bacha: It was actually a U.S. and an Australian allowance on the same patent, so one of the wonderful things about the research that we do around this molecule that has historic clinical validation, is that research leads to new discoveries and new intellectual properties. So VAL this is an older drug that we are bringing into the modern context, we have been able to file within a hundred patents that are going through the various systems around the world so we currently have 7 newly issued U.S. patents and 8 international patents around the VAL-083 that will give us a very strong basis to build a number of programs from.
WSA: So what are some of the key trends that you are targeting right now in this sector and how have you positioned in the company to capitalize?
Jeff Bacha: Well, one of the things that has been obviously a very hot space within oncology has been immuno-oncology. And what we are learning now is that the immuno-oncology programs behave very much like other targeted therapies where there are very exciting where the target that the immunotherapy is going after is prevalently expressed. And that really provides a lot of opportunities for combination therapy. So as we’ve learned more about the mechanism of action of VAL-083, it has provided us with opportunities to look at combination therapy with both immuno-oncology as well as other targeted therapies such as for example PARP inhibitors in ovarian cancer. We also know that VAL-083 works well on its own in identifying niches that are underserved with current therapy, where our understanding of the mechanism married with the historical clinical validation from the National Cancer Institute’s work points us. And so we can operate not only as a single-agent but also in combination. And I think really the trend going forward in oncology is going to be combination therapies.
WSA: And Jeff, what are the key goals and milestones here moving forward over the next 6 to 12 months?
Jeff Bacha: Well as I mentioned we are going to be moving VAL-083 into a pivotal Phase III clinical trial, this is definitely a key milestone for us in launching that program. But we are also looking at expanding our clinical focus to include newly diagnosed glioblastoma where we can point the VAL-083 at specific patients representing about two-thirds of the market who do not respond to the currently available chemotherapy—because of our understanding of the mechanism, because we saw the drug working against glioblastoma and the prior NCI-sponsored work—we can focus on those patients. And we believe, really offer them two out of three patients that are newly diagnosed with TBM an opportunity for beating the disease that they currently don’t have right now. And likewise moving into other tumor types where the mechanism combined with that historical clinical validation points us for example into lung cancer and into ovarian cancer into Medulloblastoma. So really this year is about moving into that pivotal Phase III clinical trial and expanding our clinical focus to broaden the opportunity of value creation and for new products for patients around VAL-083.
WSA: So and once again for some of our listeners new to the story, can you talk a little bit about your background and experiences as well as the key management there behind the scenes?
Jeff Bacha: Sure, my background is biophysics, I spent some time in the laboratory years ago before deciding to come to the operating side of the business. I have been working on building and growing companies for about the last 25 years. My cofounder Dennis Brown has been in the business from the scientific side, in terms of cancer therapies for over 30 years. And both of his prior clinical companies had been acquired most recently a company called ChemGenex which is actually the same business model as DelMar and most of the same team as ours, was acquired for about $250 million back in 2011. The team stayed together, picked up the next drug that Dennis was interested in, reformed as DelMar and we have marched forward from them.
WSA: And as far as investors and the financial community are concerned as you continue to get your story out there and communicate with the financial community, what are some of your drivers that you still wish perhaps they better understood about you guys?
Jeff Bacha: I think the key things are working with that we are working with the drug that we know has activity against the tumors we are interested in and that was established by the National Cancer Institute years ago. The other key factor is our team has done this before, same business model with a different compound that was successfully developed through the FDA is now marketed by Cadila Pharmaceuticals, the drug is called Synribo. And of course when ChemGenex the predecessor company to DelMar was acquired, as I mentioned, the team stayed together, picked up VAL-083 and reformed as DelMar Pharmaceuticals. So starting with a de-risked asset with a breadth of clinical opportunities starting with glioblastoma and a team that’s done this before, I think makes us a very attractive opportunity in terms of an investment.
WSA: And what are some of the other key factors that you feel make the company unique from some of the other players that are in the sector?
Jeff Bacha: Well as I mentioned the main focus with other companies has been largely in immuno-oncology of late and we have chosen to focus on traditional chemotherapies that are foundational across the board in the treatment of many tumor types. And what we have done is identify a chemotherapy that is unique in its mechanism that can overcome resistance associated with those other therapies and having that prior clinical validation, I think those are the things that really set us apart.
WSA: And yeah last time we spoke, you also discussed how VAL-083 crosses the elusive blood-brain barrier, can you explain a little bit more about that?
Jeff Bacha: Yeah, so VAL-083 does indeed cross the blood-brain barrier and that in fact is one of the reasons why the National Cancer Institute in their efforts in studying the molecule spent a fair bit of effort in studying tumors in the brain simply because the drug got there. Most drugs cannot enter the central nervous system. Our bodies are designed to protect the brain and the central nervous system from chemical insults, VAL-083 does get into the central nervous system readily. It’s a very small molecule and it’s essentially a small sugar that can attack the tumor. And as you are probably aware of, much of the sugar in our body is used in the central nervous system and in our brain. And therefore sugars are readily taken up into the CNS, and in this case actually sequesters rapidly into tumor cells preferentially to normal tissues. So it’s a great situation where we don’t have to try to make the drug go into the brain, it actually just does it naturally. And so that’s something that we can leverage certainly.
WSA: Great. And so once again, joining us today is Jeffrey Bacha, the President and CEO for DelMar Pharmaceuticals which now trades on NASDAQ, ticker symbol DMPI, currently trading at $3.20 a share market cap is about $35 million. And before we conclude here, Jeff to recap some of your key points, why do you believe investors should consider the company as a good investment opportunity today?
Jeff Bacha: Well, in a nutshell starting with the drug that we know has acted against the tumors that we are interested in, focusing on mechanism to identify underserved niches that are huge unmet medical needs that we can leverage that historical clinical data with the team that’s done this successfully before, I think makes us stand out as a great opportunity.
WSA: Well, we certainly look forward to continue to track the company’s growth and continue to report on your upcoming progress, and we would like to thank you for taking the time to join us today Jeff and update our investor audience on DelMar Pharmaceuticals DMPI, it’s always good to have you on.
Jeff Bacha: Thank you Juan, and we will look forward to continue to update you as we move into that pivotal Phase III clinical trial this year. Thank you.