AbCellera Biologics Inc.

and compliance officer. You may begin. Thank you. Hello, everyone. Thank you for joining us for Obscilla's 2025 second quarter earnings call. I'm Trent Steinmart, Obscilla's chief legal and compliance officer. Dr. Carl Hanson, Obscilla's president and CEO, and Andrew Booth, Obscilla's chief financial officer are also on the call. During today's call, we anticipate making projections and forward-looking statements based on our current expectations and following the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Our actual results may differ materially due to several factors outlined in our latest Form 10-K and subsequent Forms 10-Q and 8-K filed with the Securities Exchange Commission. Obscilla is not obligated to update any forward-looking statements, whether due to new information, future events, or otherwise. Our presentation today, including our earnings press release and SEC filings issued earlier today, are available on our Investor Relations website. The information we provide about our antibody therapy pipeline is for the benefit of the investment community is not intended to be promotional. As we transition to our prepared remarks, please note that all dollars referenced are U.S. dollars. After our prepared remarks, we will open the lines for questions and answers. Now I'll turn the call over to Carl.

Thanks, Trinh, and thank you everyone for joining us today. This quarter we achieved a major company milestone, receiving Health Canada authorization to initiate Obscilla's first two clinical trials for ABCL 635 and ABCL 575. Today I'm pleased to announce that dosing has begun in our Phase 1 clinical trial evaluating ABCL 635 for moderate to severe vasomotor symptoms. This marks completion of the transition from a platform company to a clinical-stage biotech that we committed to back in 2023. After the end of the quarter, we also opened our Phase 1 clinical trial for ABCL 575, and we anticipate dosing will begin shortly. I'm also pleased to announce that we have added a third program to our pipeline by advancing ABCL 688 into IND-enabling studies. We ended the quarter with approximately $750 million in available liquidity, and we are well positioned to continue to execute on our strategy and are on track to complete our remaining goals for 2025. These include continuing to build our pipeline by advancing at least one more development candidate into IND-enabling studies, completing platform and infrastructure investments, and starting to use these capabilities in clinical manufacturing. ABCL 635 is a potential -in-class therapeutic antibody being developed for the non-hormonal treatment of moderate to severe vasomotor symptoms, more commonly known as hot flashes, that are associated with menopause. ABCL 635 is a potential next-generation NK3R antagonist designed to have both an improved safety profile and a more convenient dosing regimen. If ultimately successful, we believe it can be a highly differentiated product that would launch into a large and established market. We successfully completed the CTA process for ABCL 635 in Q2 of 2025, and today we are pleased to announce that we have begun dosing participants. The ABCL 635 Phase 1 clinical trial is a randomized, placebo-controlled, double-blind study in men and postmenopausal women with or without VMS. Its purpose is to evaluate safety, pharmacokinetics, pharmacodynamics, and the frequency and severity of VMS with subcutaneous doses of ABCL 635. The primary endpoint of the study is safety, and a key secondary endpoint is pharmacokinetics. As I mentioned on the last earnings call, we believe the main scientific risk for ABCL 635 is whether or not we can achieve sufficient target engagement. We expect this will be addressed through biomarker and -of-concept studies that are part of our Phase 1 design. As previously stated, we expect initial safety and efficacy data from this trial in mid-2026. Turning to our second program, ABCL 575, we received authorization from Health Canada in May to initiate a Phase 1 clinical trial. The trial was opened in July, and we anticipate dosing our first participants this quarter. This is a double-blind, placebo-controlled study designed to assess safety and tolerability in healthy participants following subcutaneous doses of ABCL 575. ABCL 575 is an investigational antibody therapy targeting oxfordyligand that is being developed for the treatment of moderate to severe atopic dermatitis and which also has broad potential in several other I&I indications. We recently presented preclinical data which demonstrates it has potent functional activity in vitro that is in line with amyotillumab as measured by cytokine responses across a variety of cytokines, including IL-13, IL-5, and IL-9. As a reminder, ABCL 575 is engineered with Half-Life Extension to support less frequent dosing. Based on PK data we have obtained from studies in fCRN humanized mice, we predict a human half-life of approximately 67 days. Using this half-life, our modeling predicts that a 300-milligram dosing of ABCL 575 every six months should achieve circulating concentrations that remain above the efficacy threshold that was observed for amyotillumab. This prediction, once confirmed in clinical studies, would support a product profile with subcutaneous dosing once every six months. In addition to our clinical programs, we continue to allocate significant resources to internal discovery to build out our pipeline. This quarter we advanced ABCL 688 into IND and CTA enabling studies. ABCL 688 is a potential antibody medicine for an undisclosed indication in autoimmunity. It is the third program in our pipeline and the second program derived from our GPCR and ion channel platform. Similar to ABCL 635, for strategic reasons we will not be disclosing additional information on ABCL 688 until this program reaches the clinic. Our intent is to submit an IND in mid-2026. For the remainder of the year, our priorities are as follows. Executing on our clinical studies with ABCL 635 and ABCL 575, moving ABCL 688 forward in IND enabling studies, advancing a fourth program from discovery into our pipeline, and finally bringing our clinical manufacturing capabilities online. And with that, I'll hand it over to Andrew to discuss our financials. Andrew? Thanks, Carl.

As Carl pointed out, Epsilera continues to be in a strong liquidity position with approximately $580 million in cash and equivalents and with roughly $170 million in available committed government funding to execute on our strategy. We are continuing to execute on our plans with a focus on internal programs and on completing our CMC and GMP investments. Looking at our business metrics, in the second quarter we started work on five partner-initiated programs, which takes us to a cumulative total of 102 programs with downstream participation. Both ABCL 635 and ABCL 575 received their clinical trial authorizations in the second quarter, thus advancing into the clinic. They are the first Epsilera-led molecules to reach the clinic, taking the cumulative total number of molecules to have reached the clinic, including those led by partners, to 18. As we have previously stated, we view the overall progress of molecules in the clinic as a potential source of near and midterm revenue from downstream milestone fees and royalty payments in the longer term. Turning to revenue and expenses, revenue for the quarter was approximately $17 million, comprising of research fees relating to work on partner programs and amounts related to licensing. This compares to revenue of $7 million in the same quarter of 2024. The licensing fees of $10 million stems from our Triene Humanized Rodent Platform and most closely consists of a lump sum amount in this quarter. With respect to research fee revenue, as we have mentioned in the past, we expect these to continue to trend lower as we increasingly focus our internal and co-development programs. Our research and development expenses for the quarter were approximately $39 million, $2 million less than last year. This expense reflects ongoing investment in our internal and co-development programs. The slight decrease is related to the timing of larger program-specific related expenses, which were larger in the second quarter of last year. In sales and marketing, expenses for Q2 were about $3 million, a small reduction relative to the same quarter last year. And in general and administration, expenses were approximately $19 million, compared to roughly $20 million in Q2 of 2024. Included in these expenses are the ongoing expenses related to the defense of our intellectual property. Looking at earnings, we are reporting a net loss of roughly $35 million for the quarter, compared to a loss of $37 million in the same quarter of last year. In terms of earnings per share, this result works out to a loss of $0.12 per share on a basic and diluted basis. Looking at cash flows, operating activities for the first half of 2025 used approximately $44 million in cash and equivalents. Excluding investments in marketable securities, investment activities amounted to a net $36 million, mostly in property, plant, and equipment driven by the ongoing work to establish CMC and GMP manufacturing capabilities. The investments in PP&E were partially offset by government contributions. As a part of our Treasury strategy, we have about $460 million invested in short-term marketable securities. Our investment activities for the quarter included an approximately $12 million net increase in these holdings. Altogether we finished the quarter with $580 million of cash, cash equivalents, and marketable securities. As a reminder, we have received commitments for funding for our GMP facility and the advancement of our internal pipeline from the Government of Canada's Strategic Innovation Fund and the Government of British Columbia. This available capital does not show up on our balance sheet. With over $580 million in cash and equivalents and the unused portion of our secured government funding, we have around $750 million in total available liquidity to execute on our strategy. The cash usage for the remainder of 2025 will continue to prioritize advancing our two lead programs through their Phase I clinical studies, building the pre-clinical pipeline, and completing our investment in the integrated clinical manufacturing capabilities. Our new manufacturing facility is on track to come online at the end of 2025, as we had indicated in previous calls. With respect to our overall operating expenditures, our capital needs continue to be very manageable. We continue to believe that we have sufficient liquidity to fund well beyond the next three years of increasing pipeline investments. And with that, we'll be happy to take your questions.