Bergenbio ASA

OSE:BGBIO

Earnings Call Transcript 2020-Q2

[Richard Godfrey, Chief Executive Officer]

Hello. Good morning. Welcome to BerGenBio's quarter 2 half year report highlight 2020. My name is Richard Godfrey, I'm the CEO of BerGenBio. And I'm joined by Rune Skeie, our CFO; Hani Gabra, our Chief Medical Officer; and James Lorens, our Chief Scientific Officer.I'd like to give a special welcome to our new shareholders. We have more than 10,000 shareholders in the company now, and I'd also like to extend a special welcome to new international shareholders that have recently joined our register.Next slide, please. We are, of course, a public company, and I should draw your attention to these forward-looking statements and ask that you pay attention to the details.Next slide, please, Slide 3. By way of a corporate overview and introduction, BerGenBio is a world leader in understanding the role and function of AXL biology. AXL is a tyrosine kinase that drives aggressive disease including immune-evasion, therapy-resistant and metastatic cancer, fibrosis and also viral infections. BerGenBio has a number of inhibitors of AXL in clinical development and multiple opportunities for other aggressive diseases. Our lead program is bemcentinib, an oral one-a-day anti-AXL pill, and we are also developing an anti-AXL antibody tilvestamab.At the same time and in parallel, we are exploring and developing biomarkers with the aim of developing a companion diagnostic that will identify patients that are most likely to benefit from our AXL inhibitors. During 2020, we anticipate a number of important clinical data points in leukemia, in acute myeloid leukemia in combination with chemo, in non-small cell lung cancer in combination with KEYTRUDA and as a monotherapy in COVID-19 patients.We're listed on the Oslo Stock Exchange under the ticker BGBIO, and we have a number of significant clinical collaborators, including Merck, the U.K. research institutions and many leading academic centers across Europe and the United States. Our organization now stands at 45 staff. We've increased the organization size in recent months. We remain headquartered in Bergen, Norway, with our R&D activities and our clinical development teams are based in Oxford in the U.K. At the end of quarter 2, our cash balance was NOK 828 million.Next slide, please, Slide 4. Quarter 2 has been an extraordinarily busy and successful quarter for BerGenBio. In May, we were successful in closing a private placement of more than NOK 500 million, so we're very grateful to our shareholders and new investors.In June, we announced the first patient in, in our COVID-19 Phase II trial called ACCORD, which is a U.K. government-funded study, where the U.K. government selected bemcentinib as the first experimental agent to enter this seamless platform to test the efficacy and safety of bemcentinib in these patients. However, on the 28th of July, as a result of low-COVID instance in the U.K., the UKRI decided to stop funding that study and recruitment was halted for all drugs in the ACCORD program. In June, BerGenBio presented data at the Next Gen Immuno-Oncology Conference. We presented data showing that bemcentinib in combination with KEYTRUDA met the primary endpoint of overall response rate in second-line non-small cell lung cancer patients. Post-period, we also announced that the first patient was dosed in another investigator-sponsored study this time in glioblastoma, which is a Phase I/II study to evaluate bemcentinib monotherapy. And just this morning, we announced that bemcentinib met its primary endpoint of overall response rate in another investigator-sponsored study called BERGAMO, which is a Phase II trial in second-line patients with high-risk myelodysplastic syndrome or acute myeloid leukemia. More details of these to follow.Next slide, please. Like all business leaders in these unprecedented times of global pandemic, my primary concern, of course, is with regards to the safety, health and well-being of our staff, patients on our trials and collaborators. And together with the management team, we have taken all reasonable steps to do -- to ensure this, and at the same time, maintain the progress of our business. Clinical trial patient recruitment has been affected by this pandemic, although -- and project time lines have been protracted, although I'm very pleased to report that recruitment into our trials continues, and we also continue to report very positive and encouraging clinical data in patients on the studies. At the same time, BerGenBio remains in a strong cash position with sufficient funds to deliver on our immediate development plans.Next slide, please. As a reminder, I'd just like to -- and for those who are less familiar, I'd like to introduce AXL biology and how it drives aggressive disease.Slide 7, please. AXL mediates multiple survival mechanisms used by cancer, in particular, chemo drug resistance, immune evasion and metastasis. It also facilitates viral entry into host cells and reduces antiviral immunity. AXL is member of a class of proteins called tyrosine kinases, and they're important for regulating cells of the innate immune system. AXL mediates its effect by being upregulated and it's upregulated in response to stress within the tumor or their cellular microenvironment. AXL is also a key suppressor of type I interferon, which is a very important mechanism that's used by many diseases, and in particular, is used by viruses to knock out or dampen the antiviral immune system. And more recently, we have understood that AXL is used by different envelope viruses such as Ebola, Zika and SARS-CoV-2 to enter the cells. AXL expression in healthy tissues is very low, and it's elevated by stress factors in the microenvironment and it mediates aggressive disease.Next slide, please, Slide 8. I've used this slide many times before. In the center here, they're trying to depict a tumor. The tumor is a lump or bump that typically grows out of control in the body. It is often treated with surgery, radiation, chemotherapy. It also can be subject to immune response and inflammatory response. And when the tumor is under stress, AXL is upregulated and causes a whole lot of various survival mechanisms so that the cancers can survive. On the right, we can see AXL on the tumor cell. And we know, as mentioned before, it operates as a type I interferon checkpoint. It mediates drug resistance, allows cancer cells to resist immune death and also facilitates metastasis. On the left, we can see that AXL is also present on many cells of the innate immune system, on macrophages, on dendritic cells, has a role to play in T cell-mediated cell death and also in the Treg cells.Next slide, please, Slide 9. Here, we try to depict the role of AXL as used by enveloped viruses to enter the cells and dampen the viral immune system. On the left-hand side of the graphic, we can see AXL on the cell surface where the SARS-CoV-2 virus has wrapped itself in phosphatidylserine and been able to bind to their AXL receptors. In doing that, it signals the actual response and also triggers upregulation of AXL on the host cell and also other cells. At the same time, it triggers the so-called phagocytosic mechanism by the host cell, where the host cell eats the viral particle in a mechanism known as apoptotic mimicry. This allows the virus to enter the host cell and take over the protein synthesis of itself within the host cell. We also know, on the right-hand side, part B, that the viral AXL unit can then cross-talk with the interferon receptor that, in turn, leads to suppression of the interferon response that prevents the antiviral mechanisms that's innate in our cells. So AXL is a multitalented mechanism that the viruses used to enter the immune system and also to dampen their response rate. This unique mechanism is why bemcentinib as a selective inhibitor of AXL was selected by the U.K. government to be tested in the COVID trials.Slide 10. May I now introduce you to bemcentinib?Slide 11. Bemcentinib is a first-in-class potent, orally bioavailable, if you take it orally, highly selective inhibitor of AXL. You can see that we manufacture it as a capsule and we package it in simple HDPE pots. It's administered just once-a-day dosing. We have increasing confidence as it's now been tested in more than 300 patients. It seems to be safe and well tolerated in many, many situations as a monotherapy and also in combination with other drugs. And increasingly, we are understanding that its mode of action is very synergistic with other therapies, enhancing their response.Next slide, Slide 12. Our pipeline of clinical development of bemcentinib is divided into 2 groups, studies that BerGenBio is sponsoring with our funds and overseen by our management, and those that are sponsored by third parties, the so-called investigator-sponsored studies. On Slide 12, we can see an overview of our sponsored clinical trials and a summary of our near-term news flow. As you can see at the top, bemcentinib monotherapy in second-line AML and MDS. This study is fully recruited and reported out at ASH and is in green. The next line, bemcentinib in combination with LDAC in second-line leukemia, this study has passed the first signal hunting phase, and it's now in an expansion phase in relapsed AML patients, and we anticipate more data being released later this year.In lung cancer, we have 3 studies running in combination with KEYTRUDA in chemorefractory patients, in checkpoint-refractory patients and in patients that are refractory to chemo and checkpoints. And you can see that the first one is fully recruited, and indeed, we updated overall survival data of that cohort at the Next Gen Conference in June. Cohort B in IO-refractory patients also met its primary endpoint in the first stage of that study, and there's now an expansion cohort. Again, we presented that data at the Next Gen Conference back in June. In Cohort C, in combination with KEYTRUDA and chemo/checkpoint-refractory patients, this study is ongoing, and we hope to have some data by the end of the year or early next year.As announced in the recent press release, BerGenBio is also preparing to sponsor its own study in COVID-19 patients, very similar to the ACCORD study, and that trial is in setup stage at the moment, and we anticipate first patient in, in quarter 3. At the bottom here, tilvestamab, our monoclonal antibody against AXL, is in Phase I. We anticipate starting the multiple ascending study in quarter 3, quarter 4 this year.Next slide, please, Slide 13. Our pipeline of investigator-sponsored studies shows a range of different indications where bemcentinib is being tested both as monotherapy and in combination. Our strategy with investigator-sponsored study is to allow us to explore various indications where we have a strong scientific rationale that AXL inhibition would be a great benefit to patients. The top of the line here is the ACCORD study in COVID-19 patients. As you know, initiated in record time during quarter 2. But because of the low incidence of COVID patients in the U.K., funding was stopped and recruitment of that study has also stopped. That was in no way a reflection of the safety or efficacy of bemcentinib or any other drug that have ended the ACCORD program.The next 2 rows on this overview are a monotherapy study in second-line AML or high-risk MDS patients that's been coordinated by the European MDS Cooperative Group. Today, we announced that this study is fully recruited. It met its primary endpoints and that we anticipate releasing a full data set towards the end of the year. We also recently announced the third study here, which is a monotherapy study of bemcentinib in recurring glioblastoma. That's study is now ongoing, and we anticipate some interim data towards the end of the year. In the middle here, we have a study in combination with pembrolizumab, KEYTRUDA in relapsed mesothelioma. That's slated to start very soon. We have a study that's being managed out of the Haukeland Hospital here in Bergen in first-line metastatic melanoma. That study is undergoing an interim analysis right now, and we anticipate restart in quarter 3 or early quarter 4. We have a further study in combination with docetaxel chemo in second to fourth-line or late-line non-small cell lung cancer, and we hope that will conclude fairly soon. And another study in a chemo combination in pancreatic cancer, that is also ongoing. So we have a broad program of investigator-sponsored studies that allows us to test bemcentinib in multiple settings where we believe there's a strong scientific rationale for further studies.Next slide, please, Slide 14. Our strategy in developing bemcentinib to treat COVID-19 patients falls into 2 studies. As previously reported, the ACCORD 2 program has recently stopped due to cessation of funding in the U.K. as a result of very few patients being eligible to enroll in the study. BerGenBio had already initiated the setup of our own study of bemcentinib in COVID-19 patients. We're calling it Study #20, and that is in a late setup phase.Next slide, please, Slide 15. So the ACCORD trial was initiated on the back of preclinical data that suggested bemcentinib had great potential for treating early SARS-CoV-2 infection in COVID patients. And as you know, bemcentinib is the first molecule selected by the U.K. government selected to be tested in this program. This study was planned to recruit 120 patients across 10 sites in the U.K. However, in May and June of this year, the incidence of COVID-19 patients drastically declined. On the 28th of July, the U.K. research institute decided to cease funding of the ACCORD program. Immediately, the sponsor, which is the University of Southampton, notified all our ACCORD sites to stop recruiting patients into the ACCORD trial for all the experimental drug candidates. And as I mentioned, this is no reflection of the safety or efficacy of any of the experimental agents.Next slide, Slide 16, please. I think this slide is quite interesting in that we can see the incidence of patients that were eligible for the COVID trial at week 15 in April, and the COVID -- and the ACCORD study was funded and the granting awarded. 915 patients per week would have been eligible for the study at that point. Collectively BerGenBio, IQVIA and the sponsor, University of Southampton, worked with the regulators in record time to initiate the first site in week 18 and indeed enrolled the first patient in week 19. And we can see even then the number of patients at the sites that were selected for the ACCORD program had drastically reduced from 900 maybe to 200 and maybe dropping down to 150. We can see that by week 28, at the beginning of July, the number of eligible patients to the study have drastically reduced down to just 35. And a few weeks later, the U.K. government decided to stop funding and recruitment was stopped. I think we can understand this rationale, although it is somewhat disappointing. As previously announced, BerGenBio anticipated this and had initiated setting up its own ACCORD study in a different region of the world.Slide 17, please. So we could see, and indeed, we all can see that the COVID-19 pandemic remains ongoing, although there is some slowdown in countries with effective public health measures. However, as of yesterday, there were 21 million cases reported worldwide and more than 770,000 deaths worldwide, and we can see from the picture on the right here that there's still high-instance countries and the pandemic is still raging in many parts of the world. Currently, there are no medication recommended to treat COVID-19 and no cures. The FDA has granted Emergency Use Authorization for the antiviral drug remdesivir to treat severe COVID patients. And the U.S. government have also authorized and recommended the use of a corticosteroid dexamethasone for people with severe COVID-19 that require supplementary oxygen or mechanical ventilation.Our Study 20, which is in late setup stage, will be sponsored by BerGenBio and be managed by our team out of Oxford with the help of CRO. It will be conducted in a country of high COVID instance. The protocol that we will use will be very similar to the ACCORD trial and the protocol will permit co-administration with remdesivir or dexamethasone if those drugs are available and deemed appropriate. And we anticipate the first patient to be enrolled in that study in September.Next slide, please. Just a reminder of the treatment paradigms and the endpoints for a COVID study. We know that COVID patients and their disease is characterized by the World Health Organization 9-point ordinal scale, as you can see on the left-hand side, with the various categories of patient well-being from 0 to be unaffected, the patients with limited -- limitation of activities as a result of infection. It's patients in groups 3, 4 and 5 that are hospitalized with mild to moderate disease that we will be looking to treat with bemcentinib, plus/minus the standard of care, including dexamethasone or remdesivir in patients 4 or 5, if appropriate. And the endpoint is to determine the time to clinical improvement of at least 2 points or live discharge from the hospital, whichever comes first. Now the study endpoints are exactly the same as for the ACCORD program, and we anticipate first patient in, in the next few weeks, possibly early September.I'd now like to hand over to Hani, who will talk you through our leukemia and lung cancer studies and recent data that we've released. Hani are you able to take it from here on Slide 19, please?

[Hani Gabra, Chief Medical Officer]

Yes. Thank you, Richard. I'm delighted to present some more detail on our hematological and lung cancer studies. So as we've reported previously, as you know, we have a study ongoing in acute myeloid leukemia and myelodysplastic syndrome, which is a sponsored study by BerGenBio. And we should point out that our own myelodysplastic syndrome study has fully recruited as well as a second cohort where we're giving low-dose cytarabine to patients who are -- a mixture of patients, newly diagnosed, lapsed or refractory patients with AML. And based on those results with the combination with LDAC, we have expanded in particularly second-line relapsed patients with AML, and we hope to be able to present this data at a major conference in the near future.Separately, and Richard has already alluded to this, and it's in a press release today, there is an investigator-led study called BERGAMO, which is in high-risk myelodysplastic syndrome patients or who have relapsed first following a hypomethylating agent monotherapy. This study has completed and has met its primary endpoint and will be presented at a future opportunity. So with BerGenBio's own sponsored study, as we've said, these -- in particular, the B2 Cohort has completed recruitment, as has the B3 Cohort. And we are now focused -- laser-focused on this expansion, B5, shown in green here, in combination with the low-dose Ara-C in relapsed, particularly in relapsed AML, and we hope to have completed that cohort and presented at a major meeting towards the end of the year. And we anticipate this may be in ASH at the end of this year. And this will help us in terms of defining our future directions, particularly with -- combined with LDAC in AML.I'd like to just give a little bit more detail on the BERGAMO study.

[Richard Godfrey, Chief Executive Officer]

Slide 21, please.

[Hani Gabra, Chief Medical Officer]

Slide 21. Yes. As you know, this is a Phase II study evaluating the efficacy and safety of bemcentinib with high-risk MDS or AML who are failing standard of care therapy. This has met its primary endpoint. The investigator -- the investigators are part of a consortium called the European Myelodysplastic Syndromes Cooperative Group and the Chief Investigator, Professor Uwe Platzbecker, from Leipzig University is leading this work. And this study has been a study -- multicenter study of 45 patients with high-risk MDS or AML who have failed or are refractory to the hypomethylating agent is typically first line. And these patients have a poor prognosis when the MDS comes back with a 24-week 5.6 months median overall survival after failing the hypomethylating agents in MDS. Bemcentinib monotherapy was given to these patients at the standard dosing. And in these patients, the overall response rate was actually assessed in week 17 at the beginning of cycle 5 and [ added ] to the response rate, which was the primary endpoint. The secondary endpoints include toxicity, overall survival, progression-free survival, time to treatment failure, duration of remission and best overall response. And of course, we are very interested in exploratory endpoints that allow us potentially to use biomarkers for system enriching for these patients. And the full data from the study that has met its primary endpoints will be disclosed at an upcoming scientific.Moving to Slide 22. I'm going to switch to lung cancer. And just to remind you that we had 3 cohorts in our sponsored study, the first of which have completely recruited in patients who have recurred after chemotherapy, the so-called chemotherapy-refractory patients, and this is our Cohort A. We have an ongoing cohort [indiscernible], which are patients who have had their last checkpoint from which they have relapsed and they are refractory to checkpoint inhibitor plus or minus chemotherapy. And finally, Cohort C, which is both checkpoint inhibitor and chemotherapy given in the first line and patients who are refractory in the second line, all of whom are receiving the combination of pembrolizumab and bemcentinib.Going to Slide 23. This is a pictorial representation of the cohorts of the study, with Cohort A being completed, both post-interim part and completion of the cohort; Cohort B, the first stage successfully achieved and the endpoints met, and we are now in the second part of this, the so-called Cohort B2; and the third cohort, Cohort C, where we are in the first part of that recruitment, and these are, of course, patients that have relapsed from both chemotherapy and checkpoint inhibitors.Let me remind you that AXL expression produces a very poor prognosis in populations of patients where this is expressed and depicted by the red survival line compared to the AXL low patients. We would expect the populations who have AXL high expression to do very badly if untreated. And so patients who have failed checkpoint inhibition could do extremely badly if they have AXL pressure.So if I go to Slide 25, we'd like to just indicate that we are continuing to evolve our analysis of the composite AXL score, which is defined by the presence of AXL on the membranes of tumor cells, but not only in the tumor cells, also the immune cells in the tumor microenvironment. As we noted earlier, the immune modulation by AXL causes a suppression state where the tumor is unable to effectively utilize the immune system to clear cancer cells.Moving to Slide 26. I'd like to just talk a little bit about the first cohort. These are patients who have had chemotherapy but previously did not receive checkpoint inhibition. And in that population of Cohort A, so it's a significant number, half of the patients was cAXL positive. And the headline from patients receiving pembrolizumab plus bemcentinib saw that the median overall survival was 17.3 months. And that is 140% greater in the cAXL positive patient as compared to the cAXL negative. The median progression-free survival was 442% greater in the cAXL positive patients compared with cAXL negative, and the overall response rate in cAXL positive patients was fivefold that of cAXL negative patients. So remember, this is a population, AXL positive, which is supposed to do extremely badly in a natural setting for these [ times ]. So this flipping of survival is very intriguing and obviously important. So 73% of patients had clinical benefit if they had a cAXL positive state. And all of this was entirely independent of the PD-L1 status.Moving to Slide 27. This is just visually captured. If you look at the reds versus the blues, the cAXL positive towards the right-hand side, where those bars are dropping from 0% line. You can see that most patients who are cAXL positive really showed some shrinkage in their tumor. And overall, when you capture that population, there is a much greater degree of benefit in terms of response as compared to the blue group who are cAXL negative in the bottom right, and you can see that there is a lot of progressive disease and relatively little in terms of tumor shrinkage in cAXL negative patients.The next slide, 28. When you look at that shrinkage and how it converts to survival, you can quite clearly see that the cAXL positives who should do much worse than the cAXL negatives are significantly better, fivefold better in terms of response, but also much, much better in terms of progression-free and overall survival with an 8.4 months median progression-free survival versus 1.9 months for cAXL negative cases. And that is translating, although it's not material, it's translating to much better median overall survival in cAXL positive patients. Again, surprising because these patients should be doing much worse than the cAXL negatives.Moving on to Slide 29. I'm now going to switch from the naive -- the checkpoint-naive patients, those who have not received the checkpoint inhibitor previously, to those who have relapsed from or refractory to the checkpoint inhibitor. And this is cohort -- the so-called Cohort B of our study. And we have presented the interim analysis from this at a recent meeting. And I would like to just review that with you here. So we defined in a very rigorous way the status of checkpoint inhibitor-refractory patients, and this can be lofty, but we have chosen to be extremely rigorous with this definition. And these are patients who have had initial clinical benefit, either a complete response, partial response or stable disease, for at least 12 weeks and had at least 2 doses of an anti-PD-1 or a PD-L1 checkpoint inhibitor. And those patients would then have to have confirmed progressive disease via RECIST and the progression that have occurred within 12 weeks, the last dose of the checkpoint inhibitor. And then if that is captured, then the patient can enter the trial as an IO-refractory, immuno-oncology therapeutic-refractory patient, enter the trial and enrolled within 12 weeks of the initial progressive disease and no administration was allowed in July between the last dose of anti-PD-L1 and the commencement of this trial.So to look at the patient disposition, it is not dissimilar to the Cohort A in the sense that broadly or slightly more than 50% here are AXL positive in terms of the biomarker and the PD-L1 is distributed more slightly towards from the positive than the Cohort A, but this probably reflects clinical factors. Since those patients would have received [ first ] checkpoint inhibitor from the first line, some of those patients will be strongly PD-L1 positive. Impressively on Slide 33, when you look at the cAXL positive patients, it is clear that the vast majority of these patients are deriving clinical benefit with 85% of patients who have either partial response or stable disease and actually only a minor who are progressing directly on the pembrolizumab and bemcentinib combination. However, and in contrast, looking at the cAXL negative patients, these patients all progressed with no apparent clinical benefit. And this is a very intriguing result, and we hope as we get more information as this continues to hold up, we'll really drive the point home that the cAXL status, which delineates our prognosis on patients, seems to be disproportionately benefiting from the combination of bemcentinib and pembrolizumab. So looking at the Cohort B2, you can see that those blue patients, the ones who are cAXL-negative universally progressed with stable disease, a benefit in almost all the patients who are cAXL positive. And the progression-free survival, Kaplan-Meier scores, curves mirror very much what's going on in Cohort A, with a significant difference in the median progression-free survival at 4.7 months versus 1.87 months for the cAXL negative. Now the Cohort B2 are actually a mixture of patients, some of whom are receiving in the second line after just the checkpoint inhibitor the combination of pembrolizumab with bemcentinib. And that's depicted in the little green box on Slide 36 at this call. And in those patients, almost all have had clinical benefits with essentially no progressive disease. However, in those patients who have had chemotherapy typically in the first line and a checkpoint inhibitor in the second line, those patients have significantly more progressive disease. But when you analyze carefully that group, the benefit rate, the partial responses and the stable disease very much mirror with the cAXL positive state. And so it's looking like at the moment, the benefit continues to mirror the cAXL status, whether they're status in the first line or in subsequent lines.Slide 37, I'm going to hand over to Rich to discuss a bit more.

[Richard Godfrey, Chief Executive Officer]

Very good. Thank you, Hani. Apologies. I think a few people are having some sound problems. We are working on that. But hopefully, you can hear me. This is Richard. I'm on Slide 37. And I'm just going to introduce our investigator-sponsored study, the Phase I/II study in recurrent glioblastoma. It's an open-label, multicenter study to look, first of all, at the intratumoral tissue pharmacokinetics of bemcentinib in patients with recurrent glioblastoma. In other words, can bemcentinib enter the brain tissue? And is it going to be in sufficient concentrations to be effective? This is a trial that's sponsored by Professor Nakano from University of Alabama in Birmingham. It's funded by the NCI and is in collaboration with Johns Hopkins and the [ brains program ] that they are administering.Slide 38. Just a little bit of background. So glioblastoma or glioblastoma multiform is amongst the most aggressive brain cancers. Like many, many cancers, it's not a single disease. It's a collection of multiple different diseases with different characteristics and classifications. The cause of glioblastoma or GBM is somewhat unknown, and it's about 15% of all brain cancers. So it's about the largest of the brain cancer. But typically, it's treated with surgery, followed by radiation and chemotherapy. The checkpoint inhibitors have had limited effect in brain cancers. Sometimes high-dose steroids are used to treat these patients. But there are some treatment options. But despite the treatment with patient, it nearly always recurs. The median overall survival for these patients is just 12 to 15 months. So it's a very, very serious disease, if diagnosed. And without the surgery, radiation or chemo, the median overall survival with patients is just 3 months. And indeed, the 5-year survival rate is very dismal at sort of 3%, 5%, 7% or something like this. So it's a very serious disease, unmet medical need, and there's a strong scientific rationale why we hope that bemcentinib will be effective in these patients.Slide 39, please. So what do you know about GBM, glioblastoma? Well, we know that several receptor tyrosine kinase is a feature as part of the molecular pattern of glioblastoma. And indeed, other tyrosine kinase inhibitors, such as imatinib and gefitinib have received marketing authorization in the U.S. with some success in these tumors, but still very, very poor response rates. What we know from our preclinical work is that AXL expression is significantly correlated with poor prognosis with GBM. And it's believed that most tumors shift their phenotype. The cells of the tumor change their appearance during therapy and as the disease becomes more aggressive. And we also know that radiation has been seen to shift this phenotypic shift. This phenotypic shift is known as MES. MES stands for mesenchymal. And as we know, AXL is the essential mediator of epithelial to mesenchymal transition. So there's a very, very strong basic biology here where AXL mediates the change of cells as the disease becomes aggressive. And indeed, this mesenchymal phenotype and indeed AXL is a hallmark of aggressive glioblastomas.That's also been demonstrated by a number of genomic studies where we know that AXL and MET are upregulated. And we also know that from our preclinical work by inhibiting AXL, bemcentinib, we can see significant survival benefit in those models. And also, we can see that by administering bemcentinib in those models, we can get a suppression of the AXL expression in those models. So there is strong preclinical data. There's a very strong mechanistic rationale for this study.Slide 40, please. As I mentioned in the introduction, the first thing that we need to do and determine when treating glioblastoma is to ensure that bemcentinib can actually enter the brain tissue. So the study will be conducted in 2 cohorts: Cohort A, who received bemcentinib presurgery; Cohort B, who have not received bemcentinib pretreatment. The first 5 patients in Cohort A will be evaluated to confirm that bem actually does enter the brain tissue. After this initial evaluation, Cohort A and B will be fully recruited. At surgery, a fresh tissue sample of the brain tissue will be removed as part of the surgical resection and the treatment. And at that point, we'll be doing analysis to measure AXL and AXL activation in the brain tissue, correlating that with plasma concentrations. And of course, post-surgery and post-recovery, patients will then -- in both cohorts will continue to take bemcentinib in the usual fashion in 21-days cycle, being evaluated by MRI every 9 weeks or at progression.So the endpoints will include evaluating bemcentinib across the so-called blood-brain barrier, getting the brain tissue, measure the AXL expression and determine how AXL can be -- expression can be reduced with bemcentinib, and of course, determine safety and tolerability of the drug in these patients as well as assessing the progression-free and overall survival.So it's a very exciting study. It's being conducted by world experts across the United States and will provide really valuable information into the potential of bemcentinib to treat these patients. And we look forward to presenting more of this data as it becomes available in the coming months.If I can now hand over to Rune to take you through a financial report, Slide 41, please.

[Rune Skeie, Chief Financial Officer]

Thank you, Richard. I'm Rune Skeie, the CFO in BerGenBio. I will have a quick update on the key financials for the second quarter and the first half 2020.Slide 42, please. Ended the second quarter with an operating loss of NOK 64 million. This is slightly higher than the second quarter 2019, but an option cost with no cash effect on NOK 7.5 million increased the loss in the second quarter 2020. This effect was negative by NOK 2.5 million in the second quarter of 2019. The overall cost is well managed with 73% of the operating costs spent on research and development activities.Slide 43, please. The cash flow in the period was positive with NOK 412 million, affected by the private placement we completed in May, raising gross NOK 500 million. We ended the quarter with NOK 828 million in cash, an additional NOK 20 million in gross funding completed in July and the subsequent repair offering is not included in that amount.Slide 44, please. On the analyst coverage, we are pleased that DNB have reinitiated coverage in July and released the first report. Other than that, we have the same analysts as last quarter.I now want to hand over back to Richard to summarize the presentation.

[Richard Godfrey, Chief Executive Officer]

Thank you, Rune. Slide 45. I'd like to give a summary of quarter 2 and the first half 2020 and an outlook for our news flow.Slide 46, please. Here, I've tried to capture the highlights from the last 6 months. In spite of the unprecedented times in the COVID pandemic worldwide, it's been a very successful half year for BerGenBio. We presented data at ASH in combination -- of bemcentinib in combination with LDAC in AML patients. In January, we announced that we met our overall response rate endpoint in combination with KEYTRUDA in checkpoint refractory non-small cell lung cancer patients.As you know, we've had 2 successful private placements in January and May, raising over NOK 700 million, for which we are grateful to the support of our shareholders. In June, we announced the COVID study, which regrettably was stopped due to lack of patients and stopped funding. But as you know, we are looking to redress that with our own study very soon. Also in June, we were able to present more details of the non-small cell lung cancer study in patients that were refractory. Glioblastoma study that we just described also initiated, and today, we announced that we met the endpoints of overall survival in the second-line monotherapy study in high-risk myelodysplastic syndromes and acute myeloid leukemia.So in spite of the very challenging times we find ourselves, our clinical trials remain ongoing. Patients continue to be recruited. We're delighted to be able to maintain the flow of positive data that supports our clinical proof of concept and defines our clinical development strategy towards registration and look forward to updating the markets with more news in the future.Indeed, if we look to Slide 47, you can see that our anticipated news flow remains unaltered with a presentation of lung cancer data at SITC and World Congress on Lung Cancer, and leukemia data and MDS data at ASH. We've shaded out the ACCORD data, which is anticipated somewhere between August and October, as that study has stopped due to a lack of patients' eligibility to enter the study. And as soon as our new study has initiated, we'll update the market on anticipated recruitment and readout of that study.So that concludes the quarter 2, first half presentation. And I'd now like to open for questions, if I may. Thank you for your attention.Rune, did we have any questions through the portal?

[Rune Skeie, Chief Financial Officer]

Yes, we have. First question is, in which country will your COVID-19 take place?

[Richard Godfrey, Chief Executive Officer]

Thank you. Yes. That's a very, very salient question, of course, and we've not announced it. What we have indicated is that the COVID-19 studies that BerGenBio will sponsor will be in a country of high COVID incidence. We figured that it's probably most appropriate to guide the market once we've had regulatory clearance rather than announcing that -- where we filed and pending that. So please hold your horses, we'll announce that just as soon as we have regulatory clearance and the country and the government has confirmed that we can conduct our trials in that region. So we anticipate that news flow very soon.

[Rune Skeie, Chief Financial Officer]

Then we have some question about the BERGAMO study. How does the BERGAMO study in late-line MDS and AML fit with the previous later AML and MDS study that BerGenBio already has run? Will the BERGAMO study give BerGenBio new information about bemcentinib in this indication?

[Richard Godfrey, Chief Executive Officer]

I'll take first bite and then ask Hani to address that. We're delighted with the results from the BERGAMO study. It's a very, very similar patient population to our study and reinforces and supports the data that we previously presented and I think underscores potential strategies that we're considering. We are unable to release the full details. They need to be preserved for a scientific congress.But Hani, maybe you'd like to add something to my introduction?

[Hani Gabra, Chief Medical Officer]

Yes. Thanks, Richard. So yes, I completely agree. We are very pleased with the primary endpoint being met here. And as I indicated, there are 45 patients, most -- many of them MDS patients in the BERGAMO study. So it has a significant volume of data, and this will be articulated better when we present this at a conference later in the year. Yes.

[Richard Godfrey, Chief Executive Officer]

Probably what I will say though is that recognizing that these patients have failed standard of care and the ability to actually see complete responses in these patients with the bemcentinib monotherapy and the time at which they're evaluated are all strong indicators that bemcentinib is active in this late-stage disease, and of course, well tolerated.Thank you. Rune, was there another question?

[Rune Skeie, Chief Financial Officer]

Yes. It's a follow-up question on the same study about today's announcement on [ Dr. Nakano's ] efficacy endpoints. So what was the efficacy endpoint in respect to response rates?

[Richard Godfrey, Chief Executive Officer]

That specific piece of information needs to be preserved for the data release and the publication. The headline data that we can release prior to the scientific congress is that we met the endpoints and the endpoints included complete response, CRIs and PR.

[Rune Skeie, Chief Financial Officer]

So we have a question about the lung study. In non-small cell lung cancer Cohort A, many of the cAXL negative patients that don't respond appears to be PD-L1 negative. Also, a minority of the PD-L1 negative patient appears to be cAXL negative. Is there any correlation between cAXL positive and PD-L1 positive?

[Hani Gabra, Chief Medical Officer]

So that's a great question. But actually, if you think about these patients who are checkpoint inhibitor naive and look at the population of PD-L1, those patients don't get a checkpoint inhibitor because the vast majority, more than 70% to 80%, are very low for PD-L1 positivity. And that is the nature of that population who would get something else rather than a checkpoint in the first line. Despite that, 50% of that population, which is very low for PD-L1, is cAXL positive. So actually, in Cohort A, there appears to be no correlation between the cAXL status and the overwhelmingly negative state of the PD-L1 in this cohort.

[Rune Skeie, Chief Financial Officer]

Thank you, Hani. We have just one more question. It's a more technical thing. If qualified, can brain tumor patients from Norway be part of your overseas trials? Or do they have to be moved to United States of America during the trial?

[Richard Godfrey, Chief Executive Officer]

Well, again, I think I can take that. As with all clinical trials, patients have to be eligible, granted the trials. They certainly need to be under the medical supervision of an investigator on the study and then there may well be some other criteria. So again, it's like all treatment, they need to be under the jurisdiction of the investigator. And one would anticipate that, meaning that they are at least close enough to be present at the site. So I don't believe there's any requirements for the citizenship, but they certainly need to be at the site, able to receive treatment. So I suggest they do need to be in America during the study.

[Rune Skeie, Chief Financial Officer]

Thanks. That completed the Q&A session.

[Richard Godfrey, Chief Executive Officer]

Very good. Well, thank you for all that dialed in, and thank you to Rune, Hani and Jim. With that, I think we'll close the quarter 2 and half year update. Thank you all and take care in these strange times. Bye-bye.