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GT Biopharma, Inc.

GTPB / NasdaqCM / $7.19

April 5, 2021

 

Business Overview

 

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GT Biopharma, Inc. (the Company) is a clinical stage immuno-oncology company focused on developing a pharmaceutical platform for potentiated natural killer (NK) cell-based immunotherapies. The product candidates are based on tri-specific NK cell engagers (trademark TriKEs) and dual targeting NK cell engagers (TetraKEs).

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These immunotherapeutic agents react with natural killer (NK) cells and cancer cells to selectively facilitate the killing of cancer cells. In addition, these therapeutic agents display more limited adverse cytokine release in patients, thereby selectively delivering the therapy directly to the immune synapse at the site of the cancer rather than being delivered via intravenous systemic delivery as is typical for other cytokine therapies. Non-specific intravenous systemic delivery of cytokines can result in hyperactive T-cell responses and adverse cytokine storm release syndrome (CRS).

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TriKE addresses the most important aspects of the antibody response against cancer: mediation of antibody dependent cellular cytotoxicity, mediation of in vivo expansion of the immune population to recruit more NK cells, and recognition of a target tumor antigen.

 

 

GTB-3550 TriKE

 

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The lead therapeutic candidate, GTB-3550, is being evaluated in the clinic for treatment of acute myeloid leukemia (AML) and myelodysplastic syndromes (MDS). AML is a cancer in which the bone marrow makes abnormal myeloblasts, red blood cells, or platelets. Five-year survival rates are low. MDS is a cancer of the bone marrow caused by irregular blood cell production within the bone marrow.

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In a multicenter Phase I/II clinical trial, the first four patients were treated with GTB-3550 doses below the anticipated therapeutic dose and the maximum tolerated dose (MTD), and no patients showed signs of toxicity or experienced any grade of CRS. The next five patients were treated with rising doses of GTB-3550, and three of the five showed a reduction in bone blasts and two showed significant reductions in blast levels. None of the patients treated with these higher doses showed any side effects or grade of CRS, and the GTB-3550 administered to some of the patients was at doses significantly higher than the reported MTD for continuous infusion of recombinant human Interleukin-15. The trial trial data indicates that GTB-3550 rescues exhausted/inhibited endogenous NK cells, resulting in their activation, proliferation, and persistence.

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Management hopes to see greater clinical efficacy as its trial continues to dose escalate.

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The apparent ability of TriKE to work without outside supplemental engineered NK cells or combination drugs sets it apart from other cancer therapies, opening the possibility of significantly less-expensive treatments than offered by other therapies.

 

 

GTB-4550 TriKE and GTB-5550 TriKE

 

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GTB-4550 is being developed for treatment of PD-L1+ solid tumor cancers.

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The GTB-5550 product candidate is being developed for treatment of B7H3+ solid tumor cancers.

 

 

ROR1 TriKE

 

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On March 8, 2021, the Company announced preclinical results for ROR1 TriKE, a product candidate as a prospective therapy for treatment of prostate cancer. The ROR1 TriKE was evaluated in several preclinical models of prostate cancer and was found to be effective at promoting NK cell killing of multiple prostate cancer cells. Researchers also observed significant NK cell activation and interferon gamma production.

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Management plans to evaluate the ROR1 TriKE in additional IND-enabling preclinical studies with the goal of transitioning to a Phase I/II clinical trial.

 

 

TriKE therapy for complex breast and gastrointestinal cancers

 

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An estimated 13% of women will be diagnosed with invasive breast cancer in their lifetime, and 3% will die from breast cancer. Gastrointestinal cancers represent 1.5% of all new cancers in the U.S., and diagnosis at an advanced stage has a very poor prognosis.

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On December 28, 2020, the Company announced the initiation of clinical development of TriKE therapy for the treatment of HER2+, HER3+, and HER2+/HER3+ heterodimer complex breast and GI cancers. The HER2 TriKE product candidate has shown good efficacy in animal models, and the Company has initiated GMP manufacturing for FDA clinical trial development.

 

 

Manufacturing

 

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On February 18, 2021, the Company announced that it has signed an expanded GMP manufacturing agreement with Cytovance Biologics for the manufacture of all TriKEs, thereby positioning the Company for large-scale commercial manufacturing. The lead candidate, GTB-3550, was previously manufactured at the University of Minnesota GMP manufacturing center.

 

 

Intellectual Property

 

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The Company has a multi-layered patent strategy. The TriKE Platform Patent Claims focus on the simultaneous engagement and activation of NK cells. There are also composition of matter and method of use patent claims.

 

 

Leadership

 

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Anthony J. Cataldo, Chairman & CEO. He was previously Founder and Chairman/CEO of Iovance Biotherapeutics, Inc., and he also served as Chairman/CEO of several other biotech companies.

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Jeffrey S. Miller, M.D., Consulting Chief Medical Officer, is a Professor of Medicine at the University of Minnesota and Deputy Director of the University of Minnesota Masonic Comprehensive Cancer Center. Dr. Miller has 20+ years of experience studying the biology of NK cells and other immune effector cells.

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Michael Handelman, CPA, CFP, since November 2020. He has extensive experience in the role of CFO and holds a degree in accounting from the City University of New York.

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Martin Schroeder, CTO, since April 2019. His earlier experience included strategic advisory and a number of industry management and executive positions, including at a venture-backed molecular genomics company.

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Bruce J. Wendel, Vice Chairman, has considerable life sciences industry experience as well as prior roles in building companies and bringing oncology drugs to market.

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Greg Berk, M.D., Director, is a senior oncology drug development consultant. Dr. Berk previously served as Chief Medical Officer at Verastem.

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Michael Breen, Director, is an English-qualified solicitor/attorney and was formerly the Managing Director of the Sports and Entertainment Division of Bank Insinger de Beaufort N.V., which is a wealth management organization and was part of BNP Parabas Group.

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Rajesh Shrotriya, Director, served most recently (2002-17) as Chairman and CEO of Spectrum Pharmaceuticals, Inc., an oncology-focused NASDAQ-listed company. For 18 years he held various positions at Bristol-Myers Squibb Company, the most recent being Executive Director Worldwide CNS Clinical Research.

 

 

Scientific & Medical Advisory Board

 

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Samir Taneja, M.D., is the James M. and Janet Riha Neissa Profeessor of Urologic Oncology and a Professor of Urology, Radiology, and Biomedical Engineering at the New York University Grossman School of Medicine. Dr. Taneja also serves as Vice Chair of Urology and Director of the Division of Urologic Oncology in the School of Medicine, Director of the GU Oncology Program of the Perlmutter Cancer Center, and Co-Director of the Smilow Comprehensive Prostate Cancer Center at NYU Langone Health.

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Philip Werthman, M.D. is director of the Center for Male Reproductive Medicine and former assistant clinical professor of urology at the University of Southern California School of Medicine. Dr. Werthman founded Merkava Holdings, a venture capital and advisory company focused on early stage platform life sciences technologies.

 

 

Financials

 

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Income Statements (9 months through 12/31/20 vs. 12/31/19)

 

Research & development: 252,000 vs. 1,659,000

S,G&A expense: 4,321,000 vs. 8,932,000

Operating income (loss): (4,573,000) vs. (15,190,000)

Gain (loss) on disposal of assets: 0 vs. (20,494,000)

Settlement income (expense): (2,563,000) vs. 0

Interest income (expense): (6,227,000) vs. (1,493,000)

Net income (loss): (13,363,000) vs. (31,177,000)

Earnings (loss) per basic common share: (0.18) vs. (0.69)

Weighted average common shares: 72,909,738 vs. 53,967,298 (pre-split)

 

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Balance Sheet (12/31/20)

 

Cash & equivalents: 28,000

Total current assets: 246,000

Total assets: 396,000

Current liabilities: 19,706,000

Equity (deficit) of stockholders: (19,310,000)

Number of common shares outstanding (01/31/21): 91,748,639 (pre-split)

Warrants outstanding (09/30/20): 7,832,701 at a weighted av. exercise price of $0.20 (pre-split)

 

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On January 31, 2021, executive officers and directors as a group (6 persons) beneficially owned 5.37% of the common shares outstanding.

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On February 16, 2021, the Company completed a public offering of 4,945,000 common shares, generating net proceeds of $24,551,700. With the completion of that offering, convertible notes of $32,269,375 and accrued interest of $5,489,486 were converted at $3.40 per share into the right to receive 11,105,547 shares, or, in the event that such conversion exceeded a certain beneficial ownership limitation, the common stock equivalent number of shares of Series K Preferred Stock (each share convertible into 100 shares of common stock). The 8-K report filed with the SEC on February 22 provides additional details.

 

On February 11, 2021, the stock reverse split 1 for 17, and it uplisted to the Nasdaq Capital Market.

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On July 22, 2020, the Company completed a private offering that generated gross proceeds of approximately $5.6 million.

 

 

Valuation Considerations

 

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Clinical trials generally entail a high degree of uncertainty as to outcome, but very early data from the Phase I/II clinical evaluation of GTB-3550 for treatment of AML is quite promising.

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Management is very experienced and has had significant success with prior endeavors.

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Although the Company will likely require additional funding, there is no immediate need. Management has an option to call some of the warrants outstanding if the stock remains above a certain threshold.

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The February 2021 uplisting to the Nasdaq Capital Market should broaden the pool of potential investors.

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The ongoing impact from COVID-19 remains an uncertainty. The GT Biopharma website and SEC filings detail various other risks and matters, and these are hereby incorporated by reference.

 

 

Contact

 

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Executive offices: 9350 Wilshire Blvd., Suite 203, Beverly Hills, CA 90212. Phone: 800.304.9888.

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Website: http://www.gtbiopharma.com

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Investor contact: David Castaneda at 414.351.9758 or david@gtbiopharma.com

 

 

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