BeyondSpring, Inc. (BYSI) Q1 2018 Earnings Conference Call Transcript

BeyondSpring, Inc. (BYSI 6.11%)
Q1 2018 Earnings Conference Call
Jun. 21, 2018 8:00 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good day, everyone, and welcome to BeyondSpring Inc.'s first-quarter 2018 financial results conference call. My name is Amanda, and I will be your operator on today's call. Please be advised that today's call is being recorded. At this time, I would like to turn the call over to the host for today's call, Joe Rayne of Argot Partners.

Joe Rayne -- Argot Partners

Thank you. Before we begin, I'd like to advise that remarks made on today's call may reflect forward-looking statements relating to such matters as BeyondSpring's clinical and pre-clinical research and development activities, regulatory plans, industry trends, market potential, collaborative initiatives and financial projections, among others. These statements are based on currently available information and management's current assumptions, expectations and projections about future events. While management believes that assumptions, expectations and projections are reasonable in view of the currently available information, you're cautioned not to place undue reliance on these forward-looking statements.

The company's actual results may differ materially from those discussed during this call for a variety of reasons, including those described in the Forward-looking Statements and Risk Factors section of the company's 20-F and other filings with the SEC, which are available from the Investors section of BeyondSpring's website. It is now my pleasure to turn the call over to Dr. Lan Huang, co-founder, chairman and CEO of BeyondSpring. Lan?

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

Thank you. Ladies and gentlemen, thank you for joining today's call. With me today are Edward Liu, our recently appointed chief financial officer, who will discuss our first-quarter 2018 financial results and the recently announced registered direct offering; and Dr. Ramon Mohanlal, our chief medical officer, who will be available to answer questions during the Q&A portion of today's call.

This morning, I will begin by providing an update on our most current pipeline advances. As I noted on our last conference call in early April, 2018 promised to be an important year for BeyondSpring with significant milestones that have the potential to transform the company and advance us on our trajectory to become a multinational commercial-stage oncology company. Already this year, we have made critical steps toward achieving these objectives, advancing our late-stage lead asset Plinabulin in multiple clinical studies, with ongoing data readout that, to date, support our expectations for Plinabulin as a potentially superior new treatment for chemotherapy-induced neutropenia, or CIN, and a new treatment candidate for non-small cell lung cancer. With additional interim data readout expected beginning in the fourth quarter and assuming those data are positive, we plan to submit NDA to the China FDA soon thereafter, generating a steady flow of catalysts over the remainder of 2018 and into 2019.

Specifically in CIN, we expect, No. 1, Phase 3 interim analysis data for Study 105 evaluating Plinabulin and docetaxel for prevention of CIN in the fourth quarter of 2018; No. 2, Phase 2 data for the primary endpoint of Study 106 evaluating Plinabulin and TAC also in the fourth quarter of 2018; No. 3, pending positive results from these two studies, we would expect to submit the NDA to the CFDA in late 2018 or early 2019 for Plinabulin for broad target indication of prevention of severe grade four neutropenia induced by oral myelosuppressive chemotherapy.

For non-small cell lung cancer, we expect to, No. 1, announce Phase 3 interim data for Study 103 evaluating Plinabulin and docetaxel in early 2019 and contingent on positive interim data, submit an NDA to the China FDA in the first half of 2019. For our early stage pipeline, we plan to advance two Plinabulin triple combo immuno-oncology programs into Phase 1 in the second half of this year and initiate in 2019 a Phase 1 study of BPI-002 from our I/O program that we unveiled late last year as well as advance our ubiquitination program toward the clinic. BeyondSpring has a truly robust development platform and a strategy, and our first-in-class marine-derived small molecule immune agent Plinabulin is itself a pipeline in a drug.

However, for today's call, I will be focusing my remarks on Plinabulin in the CIN indication both because it's our program nearest to regulatory advancement and commercialization and because of its numerous development in recent months. By way of background, G-CSF drugs are the current standard of care in prevention of CIN, but they are characterized by second-day dosing and overall safety limitation, including severe bone pain. One of the best-known and most prescribed G-CSFs is Neulasta despite indications limited use, principally in the high-risk febrile neutropenia segment, which represents around 20% of patients undergoing chemotherapy. G-CSFs have reached $8 billion in global annual sales, dominated by sales of Neulasta and NEUPOGEN.

G-CSF therapy works by stimulating the expansion and proliferation of neutrophil precursors in the central part of bone marrow, an action that is believed to be the cause of bone pain associated with G-CSF use. Plinabulin works very differently, by stabilizing the tubulin network and reducing a protein called GEF-H1, a guanine nucleotide exchange factor. GEF-H1 activates downstream signal transduction pathways leading to the activation of protein c-Jun, which enters the nucleus of dendritic cells to upregulate immune-related genes, leading to dendritic cell maturation, T-cell activation and other effects that prevent neutropenia by reducing the neutrophil breakdown. Results of our preclinical study were presented in April at AACR Annual Meeting and showed mechanistically Plinabulin's ability to reduce CIN by protecting the normal transition of LSK to myeloid precursors in mice, providing further evidence of Plinabulin's differentiated mechanism of action.

This mechanism is important to understanding one of the key differentiating feature of Plinabulin, its potential for reduced incidence of bone pain in chemo-treated patients, something that we are seeing bear out in clinical development, which I will explain in a moment. Early in the first quarter, we presented preliminary top line clinical data from the Phase 2 portion of Study 105, a Phase 2/3 study looking at Plinabulin's effect on preventing docetaxel CIN compared to Neulasta at the ASCO-SITC Clinical Immuno-Oncology Symposium. And early this month, at ASCO, we presented data reflecting the full analysis of our Study 105 Phase 2 data in CIN in the Phase 2 portion, which included a total of 55 patients, with 14 treated with Plinabulin 20 milligram per meter square and 14 treated with Neulasta. Patients given one dose of Plinabulin 20 milligram per meter square 30 minutes after docetaxel dosing in the first cycle had the following benefits, No. 1, similar neutropenia reduction to those taking Neulasta; No. 3, 2/3 lower rate of bone pain; and No. 3, neutrophil numbers in the normal range. This data demonstrates Plinabulin's potential to be a product with a superior overall profile relative to Neulasta for treatment of CIN.

With respect to neutropenia reduction, in this Phase 2 study, patients given Plinabulin just 30 minutes after first-cycle docetaxel chemotherapy at a dose of 20 milligrams per meter square, the dose that we subsequently selected for Phase 3, had the same 14% incidence of severe grade four neutropenia as patients given 6 milligram of Neulasta the next day, consistent with its product label. Furthermore, the duration of severe neutropenia or DSN was also comparable at 0.5 day in both the Plinabulin and Neulasta arms. These findings are noteworthy, indicating that even in a small sample size, Plinabulin performed comparably to Neulasta on key efficacy measures for CIN. This is just part of the picture.

We saw notable differences between the Plinabulin and Neulasta treatment groups on other key measures. As I mentioned earlier, one significant side effect in patients given G-CSF therapy to combat the neutrophil depletion associated with chemotherapy is bone pain, bone pain that is so excruciating that it leads some patients to reduce or discontinue potentially life-saving chemo treatment. It is a significant issue and one that hasn't been addressed by current available therapies. In our Phase 2 study, 2/3 fewer patients given Plinabulin at 20 milligram per meter square reported bone pain compared to patients given Neulasta.

Specifically, 11% given Plinabulin noted bone pain on their questionnaires while a full 33% given Neulasta reported bone pain. While not unexpected, given all we know about Plinabulin's differentiated mode of action and a growing body of evidence that points to its ability to attenuate bone pain, these results are, nonetheless, meaningful and support our thesis that Plinabulin protects neutrophil precursors but does not induce their proliferation, an important distinction relative to the current standard of care. Incidence of bone pain will be a key secondary endpoint in Phase 3, and a meaningful lower rate of bone pain for Plinabulin-treated patients would represent a very important differentiating feature in the treatment of CIN. Our poster presentation at ASCO included data on another distinguishing factor for Plinabulin relative to Neulasta, a difference that was only partially expected.

In the trial, Plinabulin performed as we had expected in maintaining absolute neutrophil numbers in the normal range, again, a theory that was supported by what we have observed in preclinical and clinical trials to date that have suggested it has neutrophil protective properties. What was somewhat surprising was what we observed in Neulasta treatment arm. In the study, the Neulasta-treated patient group had a median neutrophil count that were much higher than the normal range, which can potentially cause bone marrow exhaustion and suppressed immune system. Taken together, we believe that our Phase 2 results in CIN translate into distinct advantages for Plinabulin relative to the market leader, Neulasta.

The Phase 3 portion of Study 105 that we initiated in March is now well under way. The study will include a total of 150 cancer patients at 50 sites in the U.S., China, Ukraine, Russia and Hungary. The primary endpoint of Study 105 is the reduction of neutropenia as measured by DSN in the first cycle. Secondary endpoints include the incidence of neutropenia, incidence of febrile neutropenia, incidence of and duration of hospitalization and incidence of bone pain, among others.

An interim analysis of 100 patients in this Phase 3 study is expected in the fourth quarter. This study is complemented by another ongoing late-stage study evaluating Plinabulin in preventing high-risk TAC chemo neutropenia. This trial, Study 106, is currently in Phase 2 with breast cancer. Results from this study are expected late this year.

In this study, we are planning for superiority in DSN in the first cycle. Our regulatory strategy for Plinabulin in CIN includes one global trial with patients from the U.S., China and Europe and with a combined package for the submission for conditional approval to the China FDA first, then second to U.S. FDA. Together, Studies 105 and 106 will serve as the basis for our NDA submission to the CFDA.

We are preparing that NDA submission now, working to compile in advance as much of the package as possible to enable us to submit it in late 2018 or early 2019, assuming a positive signal from the Phase 3 interim analysis of Study 105 and a positive result from Phase 2 of Study 106. Our plan is to follow the China submission with an NDA submission to the U.S. FDA based on the full clinical development data package following completion of the studies, with a submission target for the second half of 2019. The regulatory strategy for Plinabulin in CIN is mirrored by a parallel strategy for Plinabulin's non-small cell lung cancer indication.

As with CIN, our non-small cell lung cancer program for Plinabulin is also a global Phase 3 clinical development with patients from the U.S., China and Australia. And we are looking to take a similar approach, targeting early 2019 for our pre-specified interim Phase 3 analysis from our ongoing 554-patient Phase 3 Study 103, with the primary endpoint of overall survival. The interim analysis is event-driven and will look at 146-patient test. Assuming favorable trends comparing median OS from the two treatment arms, this interim data will serve as the basis for our NDA submission to the CFDA targeted for the first half of 2019, followed by a U.S.

FDA submission targeted for 2020, based on the full and final data readout from the non-small cell cancer program. For both of the CFDA submissions, efficacy data in each indication will be supplemented by a drug safety database, comprising data from the more than 300 cancer patients who have received Plinabulin in clinical trials. We have already met this requirement with Plinabulin treating over 300 cancer patients with good tolerability. Assuming we submit NDAs to CFDA as currently anticipated, we could be in a position to receive conditional approval in China within six months following each submission.

This is an important point and one that may not yet be fully appreciated by U.S. investors. The bar to achieve an approval in China is already high long before a drug candidate reaches the submission stage. From a cultural standpoint, China and the Chinese government emphasize and advance initiatives that they believe to have a high likelihood of success, and that is true for new drug development.

While nothing is absolutely certain, for a new medicine to reach the NDA stage in China, there has already been more rigor in the development process and dialogue with the agency than is seen by the stages in the U.S., which significantly lowers the regulatory risk for drugs going through the approval process. As a result, we have a great deal of confidence in Plinabulin's prospects. Rapid review can provide a significant market advantage and underpins the dual-market strategy that is designed to expedite availability of our treatment candidates in the two largest pharmaceutical markets in the world. With a high incidence and unmet medical needs in CIN and non-small cell lung cancer in both China and the U.S., these two territories represent a logical starting point to introduce what we expect will be important new medicine for these two indications.

Assuming favorable data and subsequent regulatory reviews, BeyondSpring has the potential to be a commercial-stage company as early as the second half of next year. With that in mind, we have already started process of preparing ourselves for commercialization in both U.S. and China, including identifying and securing the resources and talent we need to put in place for commercial success for Plinabulin in both markets. We expect to have more to say on our progress on this front in the coming weeks and months as we make the transition toward a commercial-stage company.

With a business that integrates clinical and manufacturing resources in the United States and China and led by a management team and world-renowned KOLs with deep experience in our target therapeutic areas in each of the countries, we are well positioned to execute on our dual-market plan, first for Plinabulin, followed by our pipeline of complementary earlier-stage oncology assets. Our pipeline of early stage assets represents future growth drivers and comprise the next stage in the Plinabulin development platform, with Plinabulin in combination with I/O agents as well as Plinabulin plus chemotherapy plus I/O agents. And our early stage pipeline is further supplemented by our ubiquitination platform, a new area in drug discovery in which I have a great deal of experience and passion. Dear to my heart, I was the person who saw the first E2-E3 ligase structure in the world, which was published in 1999 Science magazine.

In the second half of this year, we plan to submit INDs for two of our triple I/O combinations. And in 2019, we expect to advance BPI-002 and oral CTLA-4 inhibitor to IND stage and advance our ubiquitination platform toward the clinic for its effects on active-form mutant KRAS as the first target. This concludes my remarks today on our developments. And I would like to now turn the call over to Edward Liu, our new CFO, for a review of our financials.

Edward?

Edward Liu -- Chief Financial Officer

Thank you very much, Lan. As this is my first earning call since I joined BeyondSpring, I would like to take this opportunity to say that I'm extremely honored and excited to have joined BeyondSpring at such an important time in its development. With so many late-stage data readouts and regulatory submissions in the near to midterm, BeyondSpring is truly in a unique and competitive position relative to other biotech companies, and I couldn't be more enthusiastic about its prospects. I'm excited to be joining such an accomplished senior management team as we move toward taking BeyondSpring to the next level.

The $20 million registered direct offering that we announced in late May is one more step in achieving this goal. We were very pleased to have been able to attract high-quality strategic institutional investors, including New China Asset Management; Everbright Sun Hung Kai; CSOP Asset Management, which is RQFII asset management globally; and Tianyi Development, who is an investment firm who owns a leading pharmacy retail chain in China. The proceeds from the offering will further solidify our financial position to prepare ourselves for commercialization, first in China, and advance the development of our other drug pipelines. With respect to our financial results, for the first quarter of 2018, R&D expenses were $14.1 million compared to $46.7 million for the fourth quarter of 2017, which included a $42.3 million non-cash charge for acquiring global patents for Plinabulin outside of China.

Excluding the impact of this acquisition, the R&D expense for the first quarter of 2018 would have increased by $9.7 million. This is largely attributable to the $4.9 million of non-cash share-based compensation expense recorded in the first quarter of 2018 and $2.8 million related to increased clinical trial expenses. G&A expenses were $0.7 million for the first quarter of 2018 compared to $1 million for the first quarter of 2017. First-quarter 2018 G&A expenses included a $0.7 million non-cash credit related to forfeiture of certain restricted shares.

U.S. GAAP net loss was $14.1 million for the first quarter of 2018 compared to $47.4 million for the first quarter of 2017. Again, the net loss of the first quarter of 2017 included $42.3 million non-cash charge related to the acquisition of patent rights related to Plinabulin. Cash and short-term investments were $21.5 million at the end of the first quarter of this year compared to $30.6 million at the end of last year.

The company anticipates that its currently available financial resources, which included the cash received from our registered direct offering, will enable it to advance its ongoing clinical trials and submit NDAs in China for Plinabulin for the treatment of CIN and non-small cell lung cancer in late 2018 or early 2019 and in the first half of 2019, respectively. For greater detail related to our first-quarter 2018 financial results, I'll refer you to our press release issued this morning. So before I turn the call back to -- over to Lan, I would like to reiterate that BeyondSpring is on the cusp of numerous important near-term milestones that have potential to rapidly transform BeyondSpring to a commercial-stage oncology company with a footprint, not only in the U.S. but in China, a vastly underserved and largely untapped market in which we can bring to bear key regulatory and reimbursement competitive advantages to enable us to seamlessly and rapidly establish a leading presence in the biotech and the pharmaceutical landscape.

It is a truly pivotal and exciting time for BeyondSpring and its stakeholders, and I'm looking forward to sharing our progress. Now back to you, Lan.

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

Thank you, Edward. As we highlighted today, there is a lot of exciting development at BeyondSpring, and we are making significant progress toward our goal of delivering innovative new medicine to the two largest markets in the world. The remainder of 2018 and early 2019 will be a pivotal time for our company and we have ambitious plans, with a steady flow of significant milestones that have the potential to transform BeyondSpring into a commercial-stage company as early as next year. We look forward to keeping you updated on our progress.

Again, our company's principle is using sound science and solid execution to bring transforming medicine to patients. With that, we would like to now open up to questions. Operator?

Questions and Answers:

Operator

Thank you. [Operator instructions] Our first question comes from the line of Caroline Palomeque of Maxim Group. Your line is now open.

Caroline Palomeque -- Maxim Group -- Analyst

Hi. Thanks for taking the question. I was just wondering how you're thinking about some of the competitors that are about to enter the space, particularly Coherus' CHS-1701, the Neulasta biosimilar, and that's coming this fall. I'm just wondering how you're thinking about the impact on the market there and how it might affect Plinabulin.

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

Yes. So probably I can start, this is Lan, first, and then we can have Ramon to further explain. So still, I think Plinabulin is a very differentiated molecule against the G-CSF, right? And it has overall superior profile, not only in the first-day dosing, but also in lower bone pain. Those are all the limitations of G-CSF.

So in that sense, I don't think there are so much competition here. So probably we can have Ramon to further explain.

Ramon Mohanlal -- Chief Medical Officer

Yes. Thank you, Lan. So yes, we will have a Neulasta biosimilar on the market shortly. And what is important is that they typically are priced at a discount of somewhat between 15% and 20% relative to the original product, which still represent high price in today's market.

Where the differentiation with Plinabulin comes in is, firstly, we expect to be at least -- we expect to be superior or at least the same in -- based on the Phase 2 data for what we call the intermediate segment. Plinabulin differentiates itself from Neulasta for, firstly, the reason that it's given on the same day of chemo, whereas Neulasta has to wait 24 hours. We see that as a big advantage because why would doctors wait until the next day if there is a treatment available to them that is at least the same or better, a treatment that doesn't have bone pain and has all the major advantages. That is one.

Second is that Neulasta will not enter the -- what we call the intermediate segment for febrile neutropenia, which is the largest market for neutropenia. As you may know, today, G-CSF products, they are only indicated in the high-risk segment. We see an opportunity with Plinabulin to enter the intermediate segment in addition to the current established high-risk market because Plinabulin has a much better safety profile and also can compete on pricing. We believe that those are two drivers for uptake in the intermediate segment.

So from a differentiation perspective, we believe we are well positioned in terms of product profile. But also, if this will eventually become a pricing strategy, Plinabulin also is very well positioned to compete against Neulasta and biosimilars because our cost of goods is much lower than theirs. So collectively, we believe that in the established market of the high-risk segment, we can compete well based on product differentiation and pricing advantage. And in addition to that, we will position ourselves in the intermediate segment market where Neulasta and G-CSFs have not been able to establish themselves because of pricing and safety reasons.

That we see as the opportunity here for Plinabulin even with the arrival of Neulasta biosimilars.

Caroline Palomeque -- Maxim Group -- Analyst

OK. Thanks so much. That was really helpful. And then just really quick, is the U.S.

FDA filing still on track for the first half of 2019 as well? Or is that going to be after the China NDA?

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

Yes. So for the CIN indication, yes, I think China is at end of 2018, early 2019. As for the U.S. NDA, as we just related to you, probably the second half of 2019 because we are waiting for the whole dataset to finish.

Caroline Palomeque -- Maxim Group -- Analyst

OK. Thank you.

Operator

Thank you. Our next question comes from the line of Vernon Bernardino of Seaport Global. Your line is now open.

Vernon Bernardino -- Seaport Global Securities -- Analyst

Hi. Thanks for taking my question. Congrats to all on the progress. The question I have is what pre-commercialization activities can you pursue? And what have you pursued or intend to pursue before the end of the year?

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

OK. So probably I can start, and then Edward can add in addition. So first is, of course, to line up with the pre-commercialization, there's a few things we could do. No.

1 is resource-wise, right? So as you see, we just did the registered direct, and some of the funds will come in from China, including insurance company, New China; including Tianyi, which is -- owns a pharmacy retail chain in China. So all of them, they are strategic investors to help with future sales and also insurance payments for our products in China. So that's one. No.

2 is also to line up talent to our plan for the commercialization. So we're in the stages of having some significant heavyweight who has already done marketing before in the U.S. and China to help us to move ourselves into the next commercial horizon. So this is how we are doing.

And then in addition, clinical site-wise, as you see, in China, we have used -- Study 103, lung cancer, and also the CIN indications, we are using 60 of the best cancer hospitals in the country. And so there already -- the doctors there already know what Plinabulin is, its safety profile and efficacy profile. So in the future, that's very big hospitals for getting Plinabulin in their -- to their patients. And as you know, in China actually, we cover 100 of the top cancer hospitals and we cover 80% of the China market.

And then from a KOL point of view, China is very much uptown. And so we have influential KOLs who are leading the clinical trials in China, including Dr. Yan Sun, who is the China PI for the non-small cell lung cancer study, and he is the NCCN Chairman for non-small cell lung cancer in China and also the co-founder of CSCO in China, which is the ASCO equivalent. And for the CIN indication, we have Dr.

Shi Yuankai, who is the China NCCN Chairman for neutropenia management and ordered G-CSF -- biosimilar G-CSF trials in China. He was the main PI to bring them to the market. So with those KOLs onboard, their support, in the future, if this drug is approved in China, can be easily get into the NCCN Guidelines, and that would be a nice foundation for doctors to prescribe the drug and also for the insurance company to cover this. And lastly but not the least, actually, is future payment in China.

So our drug Plinabulin is very fortunate to be invited into the National Priority Drug List, so it received the 13th five-year grant award from the [Inaudible]. So for this type of status of drug, in the future, when this drug is approved, as for the domestically manufactured drug, it can get into the national insurance in China. So you can see that for the future, potentially, payment, this product can also be covered, so that would be a tremendous market driver for Plinabulin. So Edward, would you like to add to this?

Edward Liu -- Chief Financial Officer

Yes. I think you've pretty much covered everything. I just wanted to say that we are also, as Lan said, actively looking at talents, but also, we are actively evaluating the market opportunities in both China and U.S. as well.

But it's an ongoing process for us to evaluate the potential opportunities in these markets.

Vernon Bernardino -- Seaport Global Securities -- Analyst

Thanks. That's terrific information. As a follow-up, can you perhaps describe how widespread the use of the G-CSFs are in China and whether it's comparable to how they are used as they are in the U.S.? And what do you think the prospects are as far as the other types of G-CSFs and their effects in the China market?

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

Yes. Thanks for the question. So G-CSF is widely used in China but, of course, not as widely used in the U.S. Mostly, I think, the usage is still in the short-lasting G-CSF because it's much cheaper there.

But the market is tremendous, as you know, because Plinabulin is really overall superior product against G-CSF. It's not only a drug which protects neutrophil in the normal range, and that's basically the effect G-CSF is trying to achieve so that patients don't have severe infection or sepsis or die, but very fortunately, Plinabulin is also anticancer drug and adding to the chemo -- really turning the chemo into immuno agent. So with that superior profile and a differentiated profile, potentially Plinabulin can really get into the distinct market by itself. So in China, there are over 4 million new cancer patients a year.

As you know, up to 65% patients actually do use G-CSF -- do use chemotherapy, and those patients are the patients Plinabulin can get to. So that's over 2 million patients. And so the market actually, as we see, is going to be tremendous in China. So probably I can ask Edward to add to this.

Edward, do you have anything to add?

Edward Liu -- Chief Financial Officer

No, I don't have anything.

Vernon Bernardino -- Seaport Global Securities -- Analyst

Thanks for that. And last question before I get into queue then, what level of education do you think you'll need to optimize the initial adoption of Plinabulin in China?

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

Well, of course, market education is the key to any market adoption of a new drug. So as I just alluded to, so we are doing the tiered approach, right? So first is we have KOLs in the field as well as the drivers into NCCN Guideline adoption of Plinabulin into the CIN indication. And it will be adopted into high-risk and also the intermediate-risk indication, as what Ramon just discussed. And No.

2 is we are already using the -- 60 of the best cancer hospitals in the country to let doctors already reviewing our drug's profile. And then they already have their patients seeing the results of our drug, so they will be the promoter of our drug. And No. 3 is, of course, we are giving a lot of talks in the -- using our KOLs, let them -- and also, let them share their passion and excitement about Plinabulin at major oncology meetings and including the CSCO in September, and then there's another major meeting that is happening this weekend in Beijing.

So this way, it's just a layered approach to education of the doctors in China.

Vernon Bernardino -- Seaport Global Securities -- Analyst

Great. I look forward to the progress in second half this year.

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

All right. Thank you, Vernon.

Ramon Mohanlal -- Chief Medical Officer

Yes. Lan, if I may add. This is Ramon. What also is applicable for the U.S., in addition to China, is that we work very closely with members of the NCCN, which determine how Plinabulin and all the G-CSF products will be used in the context of chemotherapy with cancer patients.

These are guidelines that are created by very experienced oncologists and -- who then conclude on certain guidelines. It is important for us that we engage with these discussions, which we have started. And eventually, the goal is to be integrated in these guidelines. With Plinabulin's favorable product profile, as we discussed, we do expect that it will enter these guidelines, and that will help the uptake of Plinabulin in both U.S.

and China. China has a fairly similar approach as well. So in addition to education, we also work closely with medical policymakers and doctors who advise their fellow colleagues as to the use of neutropenia agents. And with Plinabulin being on the guideline, that is going to be very important to us.

Thank you.

Operator

Thank you. Our next question comes from the line of Matthew Cross of JonesTrading.Your line is now open.

Matthew Cross -- JonesTrading Institutional Services, LLC -- Analyst

Hey, guys. Congrats on all the recent progress this quarter and thanks for taking my questions. I wanted to ask about your TAC Study 106 that we're expecting data from later this year. Since you've now used a couple of different DSN calculation methods in the docetaxel CIN setting, could you comment on which method or methods you're expecting to utilize for the TAC study? Thanks.

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

Probably this question is for Ramon. Would you like to answer this?

Ramon Mohanlal -- Chief Medical Officer

Yes. So this question relates to the statistical methods for DSN. As we discussed, there are two different methods that are widely used, and both are accepted by the U.S. FDA.

And typically, the method that we use in Phase 3 is the method that we also will use in Phase 2. So the data that we presented recently at ASCO used the Phase 3 method that was then applied to the Phase 2 data. So we will use the Phase 3 method, it's called the extrapolated method, for both studies in Phase 3 and in Phase 2 moving forward.

Matthew Cross -- JonesTrading Institutional Services, LLC -- Analyst

Perfect. OK. Thanks for the clarification then. And then I was also hoping to get an update on the progress for the Phase 3 lung cancer trial, where I think we're expecting interim analysis for by the end of this year, but it looks like it's now tracking for early 2019.

So could you comment on what's driving that slight timeline pushback here?

Ramon Mohanlal -- Chief Medical Officer

Yes, I can comment. The interim analysis in Study 103, the lung cancer trial, will be triggered at the time point that we have certain number of events. Events means the number of patients that have died. To do a meaningful interim analysis, we need to have minimum number of events, that's death.

And death -- it's not entirely accurate to predict when the timing of death will be. If the timing will be this year, then we will have the interim analysis this year. If the timing of getting that number -- that minimum number of events is early next year, then, of course, we have to wait until next year. It's not in our control.

We need to wait until we have the right number of events before we can trigger the interim analysis.

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

Right. Just to add to Ramon's comment. Yes, it's event driven. So we really have to wait for the patient to die.

But as you know, that we're we'll into 2018, so now the timeline simply just reflects a more finely tuned estimate of what we expect interim analysis to be. So it's really not changing from what we have discussed before.

Matthew Cross -- JonesTrading Institutional Services, LLC -- Analyst

Got it. That makes sense. And if I can squeeze in just one more. I know you've mentioned the potential for immune exhaustion with Neulasta is very high.

And neutrophil counts well above normal, you see with that therapy. And I was hoping you could go into a bit more detail on whether you -- whether or not this may represent a benefit for Plinabulin in your lung cancer and other I/O combo trials.

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

Probably Ramon, you can take this question.

Ramon Mohanlal -- Chief Medical Officer

Yes, yes. Thank you. So what we see with Neulasta very clearly, and we've presented the data at ASCO, is that Neulasta is producing an overshoot of neutrophil production that is at least three to four times more than normal range than -- of the value of normal range. And we have expert KOLs who are experts in the field of neutropenia and neutrophils on our scientific team, and generally, the concern is that if you overstimulate the bone marrow and you continue to do that, you could have exhaustion of the bone marrow eventually.

So that is a potential concern. The other concern is also that with very high neutrophil numbers, as you see with G-CSF, we also start to have the concern that, that may negatively impact the immune system. We now have many immuno-oncology agents, and we also have increased our own standing of the importance of the immune system in fighting our cancers. We equally now have a large number of studies published, including in Nature, that shows that very high neutrophil numbers inhibit the immune system and also has a negative effect on survival.

We believe that this also is an important product differentiation with Plinabulin. With Plinabulin, we keep neutrophil numbers within the normal range. We don't have the overshoot, we don't have the overproduction, whereas, with Neulasta, we do see that overproduction. That overproduction also is likely the reason why most patients have bone pain because it reflects an overstimulation of the bone marrow.

So collectively, the overshoot in neutrophil counts will be -- with Neulasta and that will also apply to Neulasta biosimilars, we believe that, that will prove to be an important disadvantage for Neulasta and their biosimilars, and that will help Plinabulin also in market uptake. Thank you.

Matthew Cross -- JonesTrading Institutional Services, LLC -- Analyst

Perfect. Well, I'm glad to hear it. And thanks, I think that does it for me.

Operator

Thank you. And that concludes the Q&A session today. I'd like to hand our call back to Dr. Lan Huang for any closing remarks.

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

Well, thank you for everyone for joining the call today, and we'll keep you updated with our future progress. And thank you, and have a nice day.

Operator

[Operator signoff]

Duration: 55 minutes

Call Participants:

Joe Rayne -- Argot Partners

Lan Huang -- Co-Founder, Chairman and Chief Executive Officer

Edward Liu -- Chief Financial Officer

Caroline Palomeque -- Maxim Group -- Analyst

Ramon Mohanlal -- Chief Medical Officer

Vernon Bernardino -- Seaport Global Securities -- Analyst

Matthew Cross -- JonesTrading Institutional Services, LLC -- Analyst

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