CEL-SCI Corporation Issues Letter to Shareholders - Oct. 24, 2019

VIENNA, Va.--(BUSINESS WIRE)-- CEL-SCI Corporation (NYSE American: CVM) today issued a letter to its shareholders.

Dear Fellow Shareholders:

We at CEL-SCI have been believers in the value of immunotherapy for treating cancer for decades before others recognized it’s potential. Now cancer immunotherapy has gone from “cannot work” to “this is the future”. Today’s cancer immunotherapies are generally being developed for patients who already had surgery, radiation and/or chemotherapy or for patients for whom surgery is not an option. These patients usually have compromised immune systems. The Phase 3 trial of our investigational cancer immunotherapy Multikine* (Leukocyte Interleukin Injection) is designed to demonstrate that we can be even more successful in increasing the overall survival (OS) of cancer patients when we stimulate their immune systems before they are ravaged by surgery, radiation, and chemotherapy.

The pivotal Phase 3 clinical trial which we started almost 9 years ago for our Multikine in advanced primary head and neck cancer patients tests the hypothesis that giving Multikine treatment regimen right after cancer diagnosis, BEFORE surgery, radiation or radiochemotherapy, will increase the OS of patients beyond the OS achieved with the current “intent to cure” standard (SOC) therapies. In short, we seek to make the current “intent to cure” treatment more successful. Our first goal is to prove this concept in patients with advanced primary head and neck cancer, already about 4% of all cancers. This is an indication in dire need of a new and effective treatment because the last drug approval by the U.S. FDA for this indication was over 50 years ago. We hope to extend this concept to other solid tumors as well should our Phase 3 trial be successful.

We started our Phase 3 study in early 2011 and finished enrollment of 928 patients in September 2016. Per the study protocol 298 deaths (events) will have to occur in the two comparator groups (Multikine treatment regimen plus standard of care (SOC) vs. SOC alone) in order to determine whether the study’s primary endpoint, a 10% increase in overall survival in favor of the Multikine regimen treatment group, has been achieved.

Based on the known survival statistics available when we initiated our Phase 3 trial in 2011 we had expected to have reached 298 events some time ago. Clearly, it is a good thing when patients live longer. In fact, that is the goal of the study. However, since we are blinded to the details of the study results, we cannot know definitively whether it is our investigational Multikine treatment regimen or something else that is responsible for patients living longer. However, it would not come as a surprise for us to see a survival benefit from our Multikine treatment regimen in the Phase 3 trial. Remember that we saw an approximate 33% survival benefit in our final Phase 2 study, using the same Multikine treatment regimen as we are using in the Phase 3 study. The final Phase 2 study also showed that in just three weeks administration of our Multikine treatment regimen all of the tumor was eliminated in some patients and approximately 50% of the tumor was eliminated in many of the other patients. Twenty four regulators, including the U.S. FDA, gave us permission to run our pivotal Phase 3 clinical trial based on these data.

We have discussed at great length, internally and with outside experts, what other factors might be contributing to what appears to be a better survival in this Phase 3 study. The most obvious one is that the treatments that patients are receiving, either as the first line treatment for newly diagnosed cancer or the treatment of a tumor that has recurred, have improved during our Phase 3 trial. The next paragraph shows you that the treatments have not improved. Note that our study’s criteria and the selected anatomical regions of head and neck cancer focus on patients with the worst prognosis and thereby represents the greatest unmet medical need.

To find out how these patients have fared in the U.S. during the same time period (2011 to 2016) as the patients enrolled and treated in our Phase 3 study, we engaged an outside statistical group to collect the actual treatment and survival data for patients with the same stage at diagnosis as those that we have enrolled in our Phase 3 study. We asked them to find out how these U.S. patients have fared during the time our patients were enrolled in the Phase 3 study. They used the U.S. government data base called SEER which contains the actual treatments for individual cancer patients in the U.S. and thereby reflects the survival of our type of patients in the U.S. The U.S. survival is probably better than the survival in many of the other 20+ countries where our study was enrolled. It turns out that these U.S. patients from the data base, who should be basically the same as the patients involved in our study, only had a 47% overall survival at three years and 37% overall survival at five years. Therefore, the overall survival in treating those patients who have been receiving SOC has not improved during our long Phase 3 study and should not be responsible for the patients living longer.

After treatment with Multikine and the Standard of Care the patients enrolled in our study can take any medicine if the tumor recurs. We therefore considered the possibility that the introduction in late 2016 of Keytruda and Opdivo, two new cancer immunotherapy drugs for recurrent (once it returns) head and neck cancer, might be responsible for the lower than expected death rate in our study. The use of Keytruda and Opdivo as a treatment should already be accounted for in the SEER database results since these drugs were used in the U.S. for patients with recurring disease. In addition, those drugs show a survival benefit of about 3-4 months in head and neck cancer once the initial treatment has failed and the tumor recurs. Those extra 3-4 months do not explain what appears to be happening in our study. On top of that we must also consider that our study was enrolled in 20+ countries. In most of those countries Keytruda and Opdivo are still not available even today. That means that most of our patients have no access to them. Therefore the delay in reaching 298 events is unlikely to be due to Keytruda and Opdivo.

Some people have suggested that maybe the increased survival of the patients in our study is related to the dropout rate of patients since that would reduce the sample size. We do not think so. While we are blinded to the study results, we have never heard from the CROs who run the study that the dropout rate is a problem. In addition, the actions by the Independent Data Monitoring Committee (IDMC) speak against that as well. The IDMC, which meets periodically to review the study and data in an unblinded manner (i.e., they see everything) is tasked with focusing on the following areas:

• Efficacy: to assess the primary efficacy measure as well as the conditional power and sample size

• Safety: to assess the magnitude of adverse events and monitor for safety concerns

As recently as October 14, 2019, the IDMC recommended “…to continue the trial until the appropriate number of events has occurred”. In their letter to us they said that they reviewed “…progression free and overall survival and limited demographic and safety data available for the aforementioned protocol.” This language tells us that they are following the guidelines expected from the IDMC. If the dropout rate was too high and the sample size was reduced, they could recommend that we enroll more patients. They have not.

It is now established that cancer immunotherapy can produce a delayed survival benefit. That means that there may not be a separation in the immunotherapy survival curves until some later time in the follow-up period. In surgery, radiation, and chemotherapy studies the survival benefit, if seen, tends to be sooner. This delayed survival benefit phenomenon in cancer immunotherapy is the reason we are running an event driven study in which you have to wait for a certain number of study participants to die. When you do so you accept that a successful drug will take longer to come to market because the survival benefit takes longer to show up. See below for an actual example of how such a delay was experienced during the development of a major immunotherapy drug approved for the treatment of melanoma.

The first cancer immunotherapy blockbuster drug was called Yervoy. It was brought to market by Bristol Myers Squib (BMS). What happened in that study could be representative of what is happening in our Phase 3 study. We certainly hope so! The pivotal study for Yervoy was for patients with metastatic melanoma. BMS expected to get the required number of events within three years. However, after three years they only had 85% of the required events, and they had to wait another 1.5 - 2 years for the remaining 15% of the events (deaths) to occur. Yervoy went on to become a huge success helping many patients. What this means is that in cancer immunotherapy therapy, if the drug works, it is not surprising that you have to wait longer for the end of the study. This may feel wrong to you because most of us think that if a drug works it needs to come to market quickly. That thinking, however, cannot be applied under the study design which requires you to wait for events. If the study is ended with a lower number of events it may lack the statistical power to prove the survival benefit. Therefore, we must wait.

We are blinded to the Phase 3 study results. However, we believe that there is something happening in the study that is keeping patients alive longer than expected and by eliminating the factors other than Multikine we believe that Multikine must be producing some kind of a benefit. The longer it takes to get to the 298 events, the better it should be for patients because that should suggest that the drug is working even better. That is how it went for Yervoy, and we hope that we will get to follow the same path.

How much longer? Please remember that these patients are cancer patients and that all deaths of any cause count in an overall survival study. Patients have already been in the study between 3 and 8.5 years. That is a long time. We believe that we are nearing the end of this nearly 9 year-long study and we hope to prove that stimulating the immune system to fight cancer before the ravages of surgery, radiation, and chemotherapy will help the greatest number of patients.

We thank you for your support. We believe!

Sincerely,

Geert Kersten

Chief Executive Officer

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. When used in this press release, the words “intends,” “believes,” “anticipated,” “plans” and “expects,” and similar expressions, are intended to identify forward-looking statements. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Such statements include, but are not limited to, statements about the terms, expected proceeds, use of proceeds and closing of the offering. Factors that could cause or contribute to such differences include, an inability to duplicate the clinical results demonstrated in clinical studies, timely development of any potential products that can be shown to be safe and effective, receiving necessary regulatory approvals, difficulties in manufacturing any of the Company’s potential products, inability to raise the necessary capital and the risk factors set forth from time to time in CEL-SCI’s filings with the Securities and Exchange Commission, including but not limited to its report on Form 10-K for the year ended September 30, 2018. The Company undertakes no obligation to publicly release the result of any revision to these forward-looking statements which may be made to reflect the events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

* Multikine (Leukocyte Interleukin, Injection) is the trademark that CEL-SCI has registered for this investigational therapy, and this proprietary name is subject to FDA review in connection with the Company’s future anticipated regulatory submission for approval. Multikine has not been licensed or approved for sale, barter or exchange by the FDA or any other regulatory agency. Similarly, its safety or efficacy has not been established for any use. Moreover, no definitive conclusions can be drawn from the early-phase, clinical-trials data involving the investigational therapy Multikine. Further research is required, and early-phase clinical trial results must be confirmed in the Phase 3 clinical trial of this investigational therapy that is in progress.

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