The “race” to beat cancer

Race Oncology (RAC) is on steady financial ground, as told by its CEO, Dr Daniel Tillett. The Q3 financial results revealed a strong cash position, up by $2.44 million from last quarter. The cash flow increase can be attributed to the R&D Tax, Bonus Option, and supportive shareholders who have already converted a staggering $1.5 million.

Daniel further elaborates on the company's growth and future plans. Race Oncology has managed to address the issues with their drug that had hindered its prior use and expects to return to the clinic in the second half of 2024. This sets the stage for the commercialisation of their product, targeting a broader range of cancers. Also in the pipeline is the GLP Toxicology Study on the drug's new formulation.

Solid developments are also evident when it comes to their research on Acute Myeloid Leukemia. Promising results had been obtained from their latest Phase 2 Clinical trial, demonstrating an exceptional response rate in heavily pretreated patients. This provides a window of hope for a significant number of cancer patients. A subsequent trial in solid tumors is also set in motion. Finally, Daniel unveils long-term financial strategies, including the potential addition of $30 million to their funds through piggyback options in 2026. This strengthens the company's prospects for continual success and growth.

Find the full unedited transcript of this interview below:

Well, clinical stage biopharmaceutical company Race Oncology has released its third quarter numbers with cash and cash equivalents totaling $16.16 million, which is up $2.44 million on the prior quarter. Race has also announced some new appointments to its C-suite to get across the details, Race Oncology CEO Doctor Daniel Tillett joins me. Hi, Daniel, thanks so much for your time. Just tell us, I guess, the highlights from your quarter. Yeah, I guess the highlights. You touched on the cash position. Very good. It's good to see for biotech like us to be increasing our cash position over the quarter. And that's a combination of two things. Obviously R&D tax came in in this quarter. And also we have a bonus option out to our shareholders at the moment. And that's actually due in the June quarter. But our shareholders have been very supportive and have converted early. We've had almost a million and a half dollars come in from those. So let's put us in a really good position

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going forward. We're fully funded now for, uh,

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basically the foreseeable future, and it puts us in a really good position to be able to deliver on our, um, programs. Yeah. The yeah, other major piece of news yeah, we had was the release of, um, or the development of our new formulation, uh, which overcomes the historical problems that existed with our drug that prevented it from being used, really, basically. Um, and so we've been able to solve that problem and, um, uh, um, you know, set ourselves up really well to be able to commercialize this as a, as a product. Well, just speaking of where you are in terms of the cash position to just tell us the plans for the next quarter and how, of course, you're going to try and stay ahead here. Yeah. Well, we have um, next sort of major piece of news coming up for us is, uh, the GLP toxicology study on our new formulation. So that's a long campaign, takes a bit of a around 18 months to complete. That's all on all on schedule,

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progressing very, very well. And that allows us to get back into the clinic in the second half of, um, um, 2024. And that's been sort of a goal for us, uh, in the last sort of six, 12 months to get back into the clinic. We had a formulation of our drug before, uh, that was very limiting. And we've been able to overcome that, um, so that we can actually use it much more widely across a much wider range of different cancers than previously. So where are you at in terms of the R&D that you talked about? Because I know you mentioned that you're looking forward to getting to one of the drugs that had a bit of a hiccup to market. Just tell us, I guess, some of the work you're doing, because I understand a lot of it is in terms of acute leukemia as well. Yeah. So we have the the previous formulation is in phase two. We just announced actually a few months back, a phase two clinical trial which showed exceptional results of the drug in acute myeloid

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leukemia, and particularly in patients that had been really heavily pretreated. And it's very difficult when you have, uh, patients that have been through a lot of different treatments, they just don't respond very well to any treatment at all. Uh, and we saw a really good response, and we got 40% of those patients either, uh, to basically the opportunity of a cure for the leukemia they had, which was really an extraordinary result given the patients. So and that's the second phase two trial we've done in acute myeloid leukemia. Uh, the next trial we'll be doing will be in solid tumors, uh, across a wide range of different solid tumors. So, uh, we're kind of lucky that we have a drug that actually works pretty much across all cancer types. It's a very broad acting drug. Uh, and that really makes a great opportunity commercially because you have the ability to use it much more widely, um, than if it's in a narrow cancer subtype or, you know, a very limited market.

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Daniel, we talked about your cash positions, as you said, being healthy. Is there any plans for further raising or trying to tap the market? Yeah. As part of this bonus option, uh, there's a follow on, uh, piggyback option. So for every bonus option exercised by our shareholders, they get three piggyback options that are due in 2026. They have an exercise date in the middle of 2026, and that brings in another $30 million into the coffers. Um, if it's a if the share price is above $1.25, uh, currently we're sitting at $1.40. Uh, so those options are all in the money and really provides security and certainty around our clinical development plans going forward for many years into the future. And Daniel, also, in terms of your update, as I mentioned at the top, a few changes to this C-suite. Uh, tell us about the additions, I guess, to your management team. Yeah, well, I'm actually the newest person, but I've been. The price.

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I only just came back. I had previously been the CSO, the chief scientific officer. Uh, I've come back. Um, I left the board in early 2023, uh, resigned from the company, and I came back at the end of November as the CEO. Uh, we had a pretty drama filled 2023 with a lot of changes at the board and management level. And I came back. I'm the largest shareholder in the company. I own about 10% of the company. And I came back to basically help stabilize the company and get it back on track. And so far it's been a great success. We've risen in the last couple of months from around $0.65, um, up to $1.40. So it's, uh, it's been well received so far. Yeah. And as the largest shareholder, I'm sure you enjoy seeing that 62% jump year to date over the year, though, down about 24%. So just I guess tell us where you'd like to see fair value for race oncology. Yeah I it it's always difficult with companies like race which are you know speculative uh biotech. So

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we don't actually generate income. We generate research which will ultimately go into developing a product. So there's a bit of speculation there. But I think, you know, we we set around that sort of $2 to $3 all the way through 22 and into early 23. And I think that's kind of fair value at the moment given where we are. And I think as we start to, um, uh, deliver on the promise and the various things that we've got in the pipeline, uh, we'll see a sort of a return to that level. And then after that, obviously it's all driven by, uh, success in the clinic. Uh, that's what it's all about.