On August 14, 2023 Lisata Therapeutics, Inc. (Nasdaq: LSTA) ("Lisata" or the "Company"), a clinical-stage pharmaceutical company developing innovative therapies for the treatment of advanced solid tumors and other serious diseases, reported its financial results for the second quarter ended June 30, 2023 (Press release, Lisata Therapeutics, AUG 14, 2023, View Source [SID1234634363]).

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"The second quarter generated strong momentum for Lisata. We continued to advance multiple ongoing and planned clinical studies centered around our lead investigational product, LSTA1," stated David J. Mazzo, Ph.D., President and Chief Executive Officer of Lisata. "Of note, we implemented key changes to the Phase 2b ASCEND trial which now includes an additional cohort of subjects for the evaluation of a second dose of LSTA1 in patients with first-line, metastatic pancreatic ductal adenocarcinoma ("mPDAC"). We intend to use the results of ASCEND to explore possible conditional approvals globally and to design an optimized Phase 3 program. We also saw the initiation of the iLSTA study in Australia and the launch of our BOLSTER trial, which is the first fully sponsored study of LSTA1 by Lisata. Finally, we are delighted to announce that we have entered into a technology transfer agreement for our Tumor Penetrating Nanocomplex (TPN) Platform with Impilo Therapeutics, Inc. ("Impilo"), a newly formed company being led by former Lisata Chief Business Officer, David Slack. We are pleased that the TPN technology will be in the hands of a team of people with deep expertise in the field of RNA-based therapeutics development."

Dr. Mazzo continued, "Also, notably, in this quarter we took a number of cash conservation decisions which resulted in the extension of projected capital supporting operations into the first quarter of 2026. Now with more than two years of capital available on our balance sheet based on our current expected capital needs, we believe we are well-placed to focus on the execution of our development plans and achieve our goal of getting to meaningful clinical data readouts as soon as possible."

Development Portfolio Highlights

LSTA1 as a treatment for solid tumor cancers in combination with other anti-cancer agents
LSTA1 is an investigational drug designed to activate a novel uptake pathway that allows co-administered or tethered anti-cancer drugs to penetrate solid tumors more effectively. LSTA1 actuates this active transport system in a tumor-specific manner, resulting in systemically co-administered anti-cancer drugs more efficiently penetrating and accumulating in the tumor, while normal tissues are not expected to be affected. In preclinical models, LSTA1 has also shown the ability to modify the tumor microenvironment, thereby making tumors more susceptible to immunotherapies. Lisata and its development collaborators have amassed significant non-clinical data demonstrating enhanced delivery of a range of existing and emerging anti-cancer therapies, including chemotherapeutics, immunotherapies and RNA-based therapeutics. To date, LSTA1 has also demonstrated favorable safety, tolerability and activity in completed and ongoing clinical trials designed to test its ability to enhance delivery of standard-of-care chemotherapy for pancreatic cancer. Currently, LSTA1 is the subject of multiple ongoing or planned Phase 1b/2a and 2b clinical studies being conducted globally in a variety of solid tumor types in combination with a variety of anti-cancer regimens. These studies include:

•ASCEND: Phase 2b double-blind, randomized, placebo-controlled clinical trial evaluating LSTA1 in patients with mPDAC. The trial is being conducted at up to 40 sites in Australia and New Zealand led by the Australasian Gastro-Intestinal Trials Group in collaboration with the University of Sydney and with the National Health and Medical Research Council Clinical Trial Centre at the University of Sydney as the Coordinating Centre. Enrollment completion is projected for the second quarter of 2024; however, current enrollment already exceeds 70% of the target, so earlier enrollment completion may be achieved.

•BOLSTER: Phase 2a placebo-controlled basket trial in the U.S., Europe, Canada, and Asia evaluating LSTA1 in combination with standards of care in advanced solid tumors including head and neck, esophageal and cholangiocarcinoma. Enrollment is now open and the Company hopes to soon announce the first patient treated.

•CENDIFOX: Phase 1b/2a open-label trial in the U.S. of LSTA1 in combination with neoadjuvant FOLFIRINOX based therapies in pancreatic, colon and appendiceal cancers. The trial continues to make steady progress with enrollment completion expected by the fourth quarter of 2023 and data readouts in 2024.

•LSTA1 is currently being evaluated in combination with gemcitabine and nab-paclitaxel in a Phase 1b/2a open-label trial in China led by Qilu Pharmaceutical. During the 2023 ASCO (Free ASCO Whitepaper) Annual Meeting, Qilu Pharmaceutical presented an abstract sharing preliminary data from the study which, thus far, has corroborated previously reported findings from the phase 1b/2a trial of LSTA1 plus gemcitabine and nab-paclitaxel conducted in Australia in patients with mPDAC. Final data is expected by the end of the second quarter of 2024.

•iLSTA: Phase 1b/2a randomized, single-blind, single-center, safety and pharmacodynamic trial in Australia evaluating LSTA1 in combination with the checkpoint inhibitor, durvalumab, plus standard-of-care chemotherapy, nab-paclitaxel and gemcitabine, versus standard-of-care alone in patients with locally advanced non-resectable PDAC. Enrollment completion is expected by the end of the second quarter of 2024.

•The Company plans to study LSTA1 in combination with temozolomide in Glioblastoma Multiforme ("GBM"). This study is designed as a Phase 2a double-blind, placebo-controlled, randomized, proof-of-concept study evaluating LSTA1 when added to standard of care temozolomide versus temozolomide and matching LSTA1 placebo in subjects with newly diagnosed GBM. It will be conducted across multiple sites in Estonia and Latvia and is targeted to enroll 30 patients with a randomization of 2:1 LSTA1 + SoC versus Placebo + SoC. Target for first patient treated is in the fourth quarter of 2023. Importantly and as the Company recently announced, LSTA1 has been granted orphan designation by the U.S. FDA for malignant glioma.This action by the FDA not only highlights the unmet medical need but also recognizes the potential of LSTA1 to benefit patients in this indication.

•Lisata is also planning to study LSTA1 in combination with HIPEC interoperative intraperitoneal lavage in peritoneal carcinomatosis, which develops as a result of the contiguous spread of primary cancers such as ovarian, colorectal and appendiceal along the peritoneum. The study is a Phase I single-center, unblinded, randomized controlled trial to determine the safety and tolerability of

LSTA1 administered intraperitoneally in patients with peritoneal metastases from colorectal, appendiceal, or ovarian cancer undergoing Cytoreductive Surgery ("CRS") and HIPEC. Twenty-one total participants will be randomized 2:1 to receive LSTA1 with HIPEC versus HIPEC alone after CRS. We anticipate that this study will also be up and running in the fourth quarter of 2023 and the first patient being treated shortly thereafter.

Tumor Penetrating Nanocomplex (TPN) Platform Technology Transfer

The tumor penetrating nanocomplex (TPN) platform targets intracellular delivery of RNA-based drugs to prevent solid tumor growth. The TPN is designed so that it could not only bind a protein overexpressed on the surface of human cancer cells, but also pass through the membrane by way of a cell-penetrating peptide. Once inside the cells, the TPN is expected to release an RNA-based drug directed against the tumor. Lisata has agreed to transfer this technology to Impilo. Under the terms of the technology transfer agreement, Lisata will receive an equity stake in Impilo upon closing. Lisata is not obliged to commit any capital or additional resources to the program’s future development.

Second Quarter 2023 Financial Highlights

Research and development expenses remained constant at approximately $3.2 million for the three months ended June 30, 2023 and three months ended June 30, 2022. Expenses this quarter were primarily due to study start up activities associated with the LSTA1 BOLSTER trial, enrollment activities for the LSTA1 ASCEND study and chemistry, manufacturing and control (CMC) activities for LSTA1 to support all development activities.
General and administrative expenses were approximately $3.7 million for the three months ended June 30, 2023, compared to $3.5 million for the three months ended June 30, 2022, representing an increase of $0.2 million or 6.5%. This was primarily due to severance costs associated with the elimination of the Chief Business Officer position on May 1, 2023, partially offset by non-recurring merger related costs in the prior year.
Overall, net losses were $4.0 million for the three months ended June 30, 2023, compared to $6.6 million for the three months ended June 30, 2022, a decrease of approximately 40% primarily due to $2.2 million in non-dilutive funding received as an approved participant of the Technology Business Tax Certificate Transfer Program sponsored by the New Jersey Economic Development Authority.

Balance Sheet Highlights

As of June 30, 2023, the Company had cash, cash equivalents and marketable securities of approximately $57.6 million. Based on its current expected capital needs, the Company believes that its projected capital will fund its current proposed operations into the first quarter of 2026 encompassing anticipated data milestones from all its ongoing and planned clinical trials.

Conference Call Information

Lisata will hold a live conference call on Tuesday, August 15, 2023, at 8:30 a.m. Eastern time to discuss financial results, provide a business update and answer questions.

Those wishing to participate must register for the conference call by way of the following link: CLICK HERE TO REGISTER. Registered participants will receive an email containing conference call details with dial-in options. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time.
A live webcast of the call will also be accessible under the Investors & News section of Lisata’s website and will be available for replay beginning two hours after the conclusion of the call for 12 months.