This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.
spk01: Good day and thank you for standing by. Welcome to the AFAMED 2021 financial results and corporate update conference call. At this time, all participant lines are in listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you'll need to press star then one on your telephone keypad. Please be advised today's conference may be recorded. If you require operator assistance during the call, please press star then zero. I'd now like to hand the conference over to Alex Fudikidis, Head of Investor Relations. Please go ahead.
spk02: Thank you, Liz, and thank you all for joining us for our call today. Before we begin, I'd like to remind everyone that we issued the relevant press release earlier today, which can be found on the Investor Relations section of our website. On the call today, we have the following members of our management team. Adi Herz, our Chief Executive Officer, Andreas Harstrick, our Chief Medical Officer, Arne Sertelius, our Chief Scientific Officer, Wolfgang Fischer, our Chief Operating Officer, Denise Mueller, our Chief Business Officer, and Angus Smith, our Chief Financial Officer. The team will be available for the Q&A after the prepared remarks. Before we start, I would like to remind you that today's presentation contains projections and forward-looking statements regarding future events. These statements represent our beliefs and assumptions only as of the date of this call. Except as required by law, we assume no obligation to update these forward-looking statements publicly or to update the reasons why actual results could differ materially from those anticipated in the forward-looking statements. even if new information becomes available in the future. These forward-looking statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in these statements due to various factors, including but not limited to those identified under the section entitled Risk Factors and of Violence with the SEC, and those identified under the section entitled Forward-Looking Statements and the press release that we issued today and filed with the SEC. With that, I'll turn the call over to Adi. Adi?
spk05: Thank you, Alex. Good day, everyone, and thank you for joining us for our full year 2021 financial results and operational progress update call. I would like to start the call today by taking a moment to thank all of our employees, collaborators, and patients for their dedication, passion, and commitment to our work and the strong execution in 2021, which again was a very challenging year given the ongoing pandemic. We could have not accomplished all of that without everyone's dedication, passion, and the belief in our work. AffiMed employs an ever-growing multinational team of very talented individuals from around the world, in particular from all places in Europe. Indeed, the events that have recently unfolded in the Ukraine are of particular concern to me, all our colleagues at AFIMED. I must say I'm very proud of the way that our colleagues have pulled together in support of Ukraine in whatever ways we can. We have a few employees in our organization then you realize how much you have to stand behind the Ukraine. And we will continue to do that, whatever we can do in order to support its people, including our indeed Ukrainian colleagues and those who have loved ones and family in that country. With that, I want to turn over to give you an update on the progress that's not just been given by me, but all my colleagues will contribute. 2021 was a year of many transformative achievements for us in the company a year indeed in which we laid the groundwork for what we hope to accomplish in 2022 and beyond and for creating a number of important catalysts for our company we've been making exceptional progress in all our programs and in particular with work that we're conducting when we combine our inner cell engagers with ventricular cells. By the end of 2022, we expect to have three inner cell engagers in the clinic, which we believe will be the basis for continuous data flow over the next several quarters. As shown on slide three of our presentation, development efforts for each of our inner cell engagers It's focused on patients where we see significant unmet medical needs that may allow for fast-to-market development approaches. We have built a very strong rationale for the development of all our inner-cell engagement molecules as monotherapy and in combinations. We are very pleased to have clinical proof-of-concept data for ASM13 which provides key validation for our approach to developing our molecules as monotherapy in combination with natural killer cells and checkpoint inhibitors. This proof of concept supports the three-pronged approach that we are applying to development strategy for all our other inert cell engagement molecules. We believe that by giving patients novel treatment options, we have an opportunity to potentially develop blockbuster therapy. As an example, AFM13 now is shown on slide four. Targeting several CD30 positive lymphoma will be able to address several patient population, starting initially with relapsed and refractory peripheral T cell lymphoma. The development approach in T-cell lymphoma will be able to impact the life of approximately 1,500 patients just in the US. Earlier this year, we announced the completion of enrollment in our redirect study, which focuses on peripheral T-cell lymphoma. And we are on track to report top line data from this study in the second half of 2022. This indication, however, represents only a small fraction of the entire CD30 opportunity which includes patients with Hodgkin, T-cell, and B-cell lymphoma. And according to our analysis, these indications have an annual incidence of approximately 20,000 patients in the U.S. alone. Now in December of last year, we presented compelling data of AFM13 in combination with netracular cells. If you may recall, a unique feature of our inner cell engager is the very high affinity and the specificity to CD16A, allowing the pre-complexing of neutral kilotons with AFM13, which now forms a stable CAR-like NK complex. In addition, we have furthered dosing with AFM13 monotherapy, a unique option for our inner cell engager, and differentiated from what you can do with CAR and K cells. We believe that AFM13 infusions are retargeting donor-derived and patient-owned NK cells and potentially macrophages, thereby contributing to the efficacy. In that trial, we reported an unprecedented 100% objective response rate after just a single cycle of treatment for 13 patients treated at the recommended phase 2 dose. Now, based on this impressive data, We believe that we can address the unmet need in additional indications that I mentioned earlier through the same development approach of combining AFM13 with natural kilotons. Now, our initial target population is relapsed refractory peripheral T-cell lymphoma and Hodgkin lymphoma, which now comprises 3,500 patients just in the US. But we have the plan to expand the label to include frontline peripheral T-cell lymphoma and relapsed refractory B-cell lymphoma in the second wave, which now creates an opportunity to address about 7,500 patients in total in the US. Importantly, our initial market research also indicates that we may have an opportunity to price the AFM13 and K-cell combination therapy at a premium to CAR-T therapies, as the safety of our combination has a profile that eliminates the ancillary costs associated with the management of safety events with CAR T approaches. In addition, our ambition for AFEM 13 is to make it globally available to patients who need these treatments, either as monotherapy or in combination with natural killer cells. The combination of all of these factors now gives us confidence in a very significant market opportunity for AFEM 13. Now let me switch to AFIM24, our EGFR expressing targeting inertial engages, where we have embarked on a broad development strategy. The opportunity for AFIM, the market opportunity for AFIM24 is shown on slide five of that presentation. End of last year, we achieved a key milestone for AFIM24 through the identification of the recommended phase two dose 480 milligram flat dose weekly. And here, too, we are implementing our three-pronged development strategy, which includes the initiation of three studies investigating various EGFR-expressing solid tumor indications, now in a total of nine cores. Remember what I said earlier, that we already have clinical proof of concept for AFM13 as monotherapy and in all these combinations. Now let's have a look at the market opportunity. Non-small cell lung cancer is represented in all three studies. Colorectal cancer is represented in two out of the three studies. And we are further targeting other key EGFR-expressing tumor types, such as renal cell carcinoma, head and neck, and gastric cancer. Now, non-small-cell lung cancer and colorectal cancer are by far the largest EGFR-expressing indications, with a combined relapsed refractory patient population in the US over 130,000 patients. So this number clearly tells you that these are in high need of novel therapies that are differentiated. Here again, there is a significant opportunity as these patients need better response rates drugs with better response rate and the duration of response over existing therapies that as we have already outlined have clear limitations not just on the efficacy side but also on the safety side let me switch shortly to over over to afm 28 yet a critical drug but we will spend some time explaining you the background of afm 28 and why this becomes very important for us in it. So AFM28, our CD123 tumor-expressing targeting innate cell engager, we're initially planning to target patients with relapsed and refractory acute myeloid leukemia, short AML. AML is the most common form of leukemia with over 40,000 patients diagnosed in the seven major markets every year. and over 11,000 in the relapsed refractory setting in the U.S. alone. So AFM28 is currently prepared for clinical evaluation, and as I will explain later, we believe that AFM28 is ideally suited to address the needs of AML patients, and we're planning to submit an ID application during the second quarter of this year, following a pre-IND meeting with FDA. We expect to initiate the first inhuman study in the second half of 2022. We have been and are continuing to work with MD Anderson, Arteva, NK Chen, and other third parties to ensure access to an off-the-shelf cryopreserved metric killer cell for further development with our inner cell engagement therapy. We expect to provide additional updates on NCASEL development now during the second half of this year. Our progress, data, and the opportunity represented by our Inertial Engager program has also captured the attention of potential future partners, in particular our data that we published in December. There is a very good momentum around our ability to clinically execute our programs supported by strong data, and there is interest from the pharmaceutical industry to further explore how our ROP platform and inert cell engager molecules can add value to these parties' existing pipeline and oncology franchises. We're also continuing to advance our work with our existing partners. A key feature that has enabled these partnerships is the differentiated performance of our inert cell engager when compared to standard IgE-based formers. with a particular advantage in addressing tumor cells with low target expression and also with the unique features that we have shown for the combination of opportunities. In the case of Genentech, we have made progress in various pre-CMD programs and have begun to hand over molecules to Genentech for their further development. Our partnership with Roivent on AFM32 is strong and AFM32 has moved into IND-enabling studies. Detailed updates on these programs are or is at the discretion of our partners. We remain eligible for additional proceeds from these key collaborations in the near term, including being eligible for preclinical milestones, as well as milestones based on early regulatory achievement and also clinical progression. Finally, we're also strengthening our organization and advanced our ideas and are recruiting highly talented scientists and industry experts to help us execute our mission. Now with this, I'll turn over the call to Andreas to give you more color on the progress of our programs. Andreas?
spk13: Yeah, thank you, Adi, and also from my side, a warm welcome to our audience. It is my pleasure to review with you the progress of our clinical programs that we have achieved in 2021. Let me start by highlighting our progress for AFM13, which you can see on slide six. As you know, we have two ongoing studies with AFM13, including the registration-directed study of AFM13 as monotherapy in relapsed and refractory PTCL patients, also known as the REDIRECT study. And in addition, our Phase I-II study in collaboration with MD Anderson, where we're evaluating cord blood-derived national killer cells pre-complexed with AFM13 and followed by a single-agent AFM13 in patients with relapsed and refractory CD30 positive lymphomas. As Adi mentioned, we are very proud that we have completed enrollment into the redirect study in the registration relevant PTCL cohorts in January. We believe that this is an important milestone in the light of the very challenging environment that we have been facing over the last two years. A total of 108 patients with relapsed or refractory peripheral T cell lymphomas have been treated or are being treated with AFM13 in this trial. And we expect top line data for the second half of 2022. The focus of this initial data will be the overall response rate as assessed by a blinded independent review committee and also a preliminary assessment of duration of responses. Of course, taking into account that the maturity of the duration of response data will depend on the actual duration of these responses. You may remember that we recently announced that we decided to terminate enrollment into cohort C in the study. This cohort C was an observation cohort for patients with transformed mucosus fungoides. And since COVID is still impacting the treatment and the response assessment of these patients, this decision was taken. I think it's important to remember that this cohort C with mucosus fungoides patients was observational only and not part of the intended registration package therefore not impacting our ability to submit the cohorts in peripheral T cell lymphoma. Let's now turn to our second active study with AFM13, study AFM13-104, where we are evaluating the efficacy and tolerability of cord blood-derived natural killer cells pre-complexed with AFM13 and followed by AFM13 monotherapy in patients with relapsed and refractory CD30-positive lymphomas. In December, we reported interim data showing a response rate for the first 19 patients enrolled in the study. This included the response rate after two cycles for the first six patients, that were treated at the lower dose levels of one times 10 to the six and one times 10 to the seven cells respectively, and the response rate after only the first cycle for the 13 patients treated at the recommended phase two dose of one times 10 to the eight cells. At that time, we had demonstrated an impressive anti-tumor activity with 100% objective response rate. and a 38% complete response rate for patients treated at the recommended Phase II dose after only one cycle of therapy. We are very excited that the abstract submitted to AACR by MD Anderson Cancer Center and AFIMED for study AFM13104 has been accepted at a very prominent place for oral presentation in the clinical trials plenary session. This session will be hosted from 1 p.m. to 3 p.m. on Sunday, April 10th. In addition, MD Anderson's presentation will also be featured at the AACR press conference on Sunday, April 10th. At this AACR presentation, Iago Nieto from MD Anderson, the principal investigator of the trial, will provide updates on the first 19 patients enrolled in the study. Of note, the update will include the response rate, overall response rate and complete response rate for the 13 patients treated at the recommended phase two dose, now after two cycles of therapy, and will also show additional follow-up data as compared to the data presented in December. As you know, we have seen some evidence of deepening of responses at the lower dose cohorts between cycles one and cycles two. And therefore, the final response rate after two cycles of therapy for patients at the recommended phase two dose will allow a very good assessment of the true potency of this treatment. Also, FDA has approved an amendment for this study, which allows us to increase the patient population treated at the recommended phase two dose to 40 patients with CD30 positive lymphomas, and allows us for the treatment of patients with more than two cycles of therapy as investigator's discretion. Let's turn now to AFM24 on slide seven. During 2021, we identified 480 milligrams of AFM24 once weekly at the recommended phase two dose for our monotherapy. With this key milestone behind us, we have now initiated enrollment into the expansion phase of the monotherapy AFM24 trial at the recommended phase two dose. The expansion cohorts include patients with renal cell carcinoma, non-small cell lung cancer, EGFR mutant, and colorectal cancer. In parallel, we have continued the dose escalation to collect additional safety information and have completed enrollment in cohort seven, treating patients at 720 milligrams. We will present data from the dose escalation phase of the AFM24-101 trial at the AACR annual meeting, mainly focusing on pharmacokinetic and pharmacodynamic data, and highlighting the rationale and the foundation for the RP2D selection. The poster will be presented during the phase one clinical trial session on Monday, April 11th. As a reminder, on our Q3 earnings call, we gave an update on the key pharmacokinetic pharmacodynamic inputs that informed our decision to select 480 milligrams at the recommended phase two dose. And we provided the status of the clinical response assessment for patients through cohort six. The AACR presentation will include more granular analysis of these data points. And as a cutoff date of October 29 for the ASCR presentation, there were 29 patients dosed with AFM24. More recently, we have also initiated two combination studies. The first study, AFM24-102, is investigating the combination of AFM24 with Roche PD-L1 inhibitor atezolizumab to treat patients with non-small cell lung cancer this time EGFR white type, gastric and gastroesophageal junction adenocarcinomas, and pancreatic hepatobiliary and biliary tract cancers. The second study, AFM24103, is investigating the combination of AFM24 with SNK01, The ex vivo expanded and activated autologous NK cell product from NKGen Biotech. Here we are treating patients with non-small cell lung cancer, squamous cell carcinoma of the head and neck, and colorectal cancer. Through the three ongoing studies, we will be evaluating safety and efficacy of AFM24 in nine indication-specific cohorts, with a particular focus on non-small cell lung cancer, which was represented in all three studies, and colorectal cancer represented in two of the three studies. As announced earlier, we expect to report initial data from each of these studies during the second half of 2022. With this overview of our clinical program, now let's turn to our new candidate, AFM28, And I'm happy to hand over to Arndt, who will give you an overview of the rationale and our plans for this program. Arndt, please.
spk14: Thank you, Andreas. And good morning and good day to everyone on the call, also from me. Today, as Adi already introduced, I would like to discuss with you the story behind AFM28. Let's start with the high unmet medical need in AML as shown in slide eight. First, available treatments that are effective in ANL are often toxic and tolerated only by a fraction of patients. Second, efficacy of currently available treatments is still limited in either primary incomplete responses or early relapses. Usually within the first 18 months are common. And third, once refractory or relapse, the outlook is dismal. with only three of 10 patients a lap after one year, and only one out of 10 patients after five years because of a lack of effective treatments for relapsed or refractory disease. What is urgently needed are treatments that work in most patients, are effective and safe, prevent or delay relapse, and work in relapsed or refractory disease. With AFEM28 and its NK-cell-based mode of action, we believe we can address these needs. To provide more context, I would like to give you a brief overview of the current treatment options and explain why we strongly believe in the potential of AFEM28. Approved treatments for adult patients with newly diagnosed AML are chemotherapy, mostly sideribine, donorubicin, with or without myelotark, Emtuzonib, ozogamycin, the NTCD33 antibody drug conjugate, and the only approved antibody. Threat 3 inhibitors, IDH1 and IDH2 inhibitors, venetoclax plus hypomethylating agents, azacytin, the ketamine, or venetoclax plus low-dose cetarabine. The choice of treatment depends on whether patients can tolerate intensive remission induction therapy on cytogenetic risk and the presence of targetable mutations. However, even though these treatments can be initially effective and induce remissions, the majority of patients will fail to achieve a long-lasting complete remission or will relapse early. about 60% of patients will show progressive disease within a year. Fit patients may be candidates for allogeneic hematopathic stem cell transplantation, which is still considered the only curative option for patients with AML. Options available to patients who are not eligible for allogeneic transplant or who relapse after transplant are limited. Treatment options developed to these patients include further chemotherapy, aggressive or less aggressive, depending on patient status, and use of hypomethylating agents or targeted agents like myelotar 3 inhibitors, IDH, IDH2 inhibitors. Indeed, treatment in the context of a clinical trial is recommended. A multitude of therapeutic options have been and are investigated clinically in relapsed refractory patients, including targeted agents, ADCs, monoclonal antibodies, and T-cell-based therapies. However, so far, none have provided convincing evidence for broad effectiveness and durable responses in relapsed and refractory disease. Over the past years, it has become clear that conventional therapeutic approaches, for example, monoclonal antibodies directed against different targets like CD33 or CD123, or even effective function-enhanced antibodies have not resulted in meaningful therapeutic efficacy in AML patients, despite the use of targets that play a role in AML disease biology. Also, T-cell engagers and CAR-Ts, irrespective of target choice, such as CD33, CD123, or CLL1, et cetera, have not achieved acceptable tumor response rate and durability. However, the picture looks different, a little different when clinical data of ADCs are analyzed. It's not efficacy that's lacking. The issue is the challenging toxicity. In this context, we view myelotaric, the CD33-targeting ADC, as a molecule that in principle is effective in AML, but its therapeutic use is limited by the fact that this molecule is not employing the promising effector function of NK cells. which by themselves have shown clinical efficacy in AML. There's further clinical data from other ADCs targeted against CD33 that have shown higher efficacy, high efficacy, but are limited due to their toxicity. In addition to Mylotarq, a CD123-directed ADC, IMGN632, is currently in clinical studies. When we looked at all the available research and literature, we concluded that CD33 and CD123 directed approaches show efficacy in AML. However, it could be an advantage to use a novel effect or function. This is where the NK cells come in as a highly promising approach as recent clinical data of the use of donor-derived cord blood or peripheral NK cells to treat AML have demonstrated encouraging activity. We next analyzed which of the above approaches, monoclonals, T-cell engagers, CAR T-cells, ADCs, or innate cell engagers, can best address the need to increase the basal efficacy of NK cells. Except for monoclonals, none has the option to activate NK cells. And even monoclonals have huge limitations in their ability to redirect NK cells. As such, it became obvious to us that this is... This is an ideal setup to generate an innate cell engager based on our ROC platform. But let me explain in more detail why we feel that our innate cell engager can be broadly effective in AML and why we see particular potential in its combination with adoptive NK cell therapy. First, naked NK cells have been used in the treatment of AML in different settings in the past and have shown promising efficacy and approximately 30 to 40, with about approximately 30 to 40% overall response rate. Second, AFIMET's innate cell engages are highly differentiated by specific antibodies designed to specifically bind the NK cells with high affinity. Third, we've recently shown that the combination of an ICE, AFIM-13, with NK cells produces impressive overall response rate. and CR rates and very difficult to treat patients. And fourth, we've selected CD123 as the target for AFM28, as it is not only expressed on the blasts of AML patients, but importantly, it is also expressed on the leukemic stem cells, which are the constant source of malignant cells in AML. To induce deeper and longer lasting remissions, eradication of these leukemic stem cells is crucial. This is in contrast to, for example, CD33 targeting antibodies or antibody drug communicants, which lack the ability to also target leukemic stem cells and have also exhibited toxicities. The FM28 ICE is designed to elicit deeper and longer-lasting responses by depleting leukemic stem cells as well as AML blasts. AFIN28 has significant improvements versus normal or FC-enhanced antibody in its ability to effectively recruit NK cells to kill tumor cells, and I will now explain these differentiating factors. We believe an ICE may offer advantages in targeting CD123, as this target is only moderately expressed, and we believe high affinity and specificity targeting of CD16A is an essential factor and redirecting NK cells to kill cancer cells. As you can see in slide nine, we'll highlight that our preclinical work, which we recently shared at ASH, shows that AFM28 activates NK cells more potently than an FC-enhanced anti-CD123 antibody, telocutuzumab, resulting in increased efficacy. Moreover, when compared to this FC-enhanced anti-CD123 antibody, AFM28 was also more active against primary ANL blasts from patient peripheral blood and bone marrow, and also more active against cells with low CD123 expression. As a result, we expect that AFM28 will be less affected by baseline characteristics and differences in CD123 expression, and has the potential to induce deep responses, including efficacy against AML cells with low levels of CD123 expression. This could be a strong differentiator of AFM28 vis-a-vis on-target competitor antibody drug conjugates in this space, IMGN632, which appears to be affected by differences in CD123 expression. Based on prior testing of talocutuzumab and FC-enhanced anti-CD3 123 IgG1 in a phase 1 clinical trial in AML patients, incomplete remission with measurable minimal residual disease, and our preclinical data suggesting superiority of AFM28 over talocatizumab, it would not be unreasonable to expect single agent activity of AFM28, in particular in patients with low burden disease, such as MRD positive AML. Conversion of patients to MRD negativity is expected to be clinically meaningful based on the prognostic significance of MRD status on PFS and overall survival. Our preclinical studies with AFIN28 have also demonstrated low risk of cytokine release syndrome, which further differentiates this drug conjugates from CD123, CD3 bispecific T-cell recruiting antibodies, currently in development for AML, which all exhibit varying degrees of cytokine release syndrome, including CRS-related death. We are particularly excited about the potential of AFM28 in combination with adoptive NK cell therapies, which, as I've mentioned, have demonstrated some promising clinical activity in relapsed reflector AML as single agents already. By combining AFM28 with adoptive NK cell therapy, meaning by redirecting allogeneic NK cells to CD123 tumor cells, we believe AFN28 could increase the depth and duration of response necessary to meaningfully improve outcomes. We plan to initiate combination development at the earliest possible time point, and as soon as adequate information about safety and tolerability of single-agent AFN28 is available from the first in human dose escalation trial. The optimal strategy to initiate combination development will need to be discussed with regulatory authorities, and we plan to provide additional details at a later point in time. With that, I'll hand the call over to Angus to take you through the financials. Happy to take any questions during Q&A. Angus?
spk07: Thank you, Art. So, balance sheet and income statement highlights are on slides 10 and 11 of our presentation. First, I would highlight that AFIMED's consolidated financial statements have been prepared in accordance with IFRS, as issued by the International Accounting Standard Board, or IASB. The consolidated financial statements are presented in euros, which is the company's functional and presentation currency. Therefore, all financial numbers that I'll present on this call, unless otherwise noted, will be in euros. We ended 2021 with cash and cash equivalents of 197.6 million euros compared to 146.9 million euros on December 31st, 2020. Based on our current operating plan and assumptions, we anticipate that our cash and cash equivalents will support operations into the second half of 2023. Net cash used in operating activities for the year ended December 31st, 2021 was 86.6 million euros compared to 19.4 million euros in 2020. When comparing 2021 to 2020, it's worth noting that 2020 cash flow from operations was enhanced by the upfront proceeds received from our collaboration with Roivant, as well as a milestone payment received pursuant to our collaboration with Genentech. Total revenue for the year ended December 31st, 2021 was 40.5 million euros compared with 28.4 million euros for the year ended December 31st, 2020. Revenue for 2021 and 2020 predominantly relate to Genentech and Roivant collaborations. Collaboration revenue for the year ended December 31st, 2021 amounted to 39.3 million euros with 21.6 million coming from the Genentech collaboration and 17.7 million coming from the Roivant collaboration. Collaboration revenue for the year end of December 31st, 2020 amounted to 27.8 million euros, with 26.2 million coming from the Genentech collaboration and 1.4 million coming from the Roivant collaboration. R&D expenses for 2021 increased 63 percent from 50 million euros in 2020 to 81.5 million euros in 2021, and this was primarily due to increased expenses for AFM24 and AFM21, including costs for the production of clinical trial material. as well as an increase in costs associated with other early stage programs and infrastructure and an increase in share-based payment expenses. R&D expenses for the fourth quarter of 2021 also include an accrual for a milestone payment owed to MD Anderson for the initiation of the phase two portion of the trial investigating AFM13 pre-complex with core blood-derived natural killer cells. General and administrative expenses increased 77 percent from 13.7 million euros in 2020 to 24.2 million euros in the year ended December 31st, 2021. The increase predominantly relates to higher share-based compensation expense in 2021 and increased insurance premiums and higher consulting expenses. Net finance income for the year ended December 31st, 2021 was 6.5 million euros. compared to a net finance loss of 6.6 million for the year ended December 31st, 2020. Net finance income loss is largely due to foreign exchange gains or losses related to assets denominated in U.S. dollars as a result of currency fluctuations between the U.S. dollar and the Euro during the year. Net loss for the year ended December 31st, 2021 was 57.5 million euros or 48 cents per common share compared with a net loss of 41.4 million or 50 cents per common share for the year ended December 31st, 2020. The weighted number of common shares outstanding for the year ended December 31st, 2021 was 119.5 million. We encourage shareholders to also review our 20F filing for the year, which will be filed with the SEC today. I will now turn the call back to Adi for closing remarks. Adi?
spk05: Yeah, thank you, Angus. And yeah, as you've heard, 2021, Despite all the issues out there, it's been a really fantastic year for AffiMed. So we brought programs forward. We had this unprecedented data for EFIM 13, and our cash position is strong. As shown on slide 12, we're now moving forward with multiple programs. Our lead asset at EFIM 13 is in the registration-directed study, and we can report the results in the second half of this year. More important is now that we have found a way to address the full breadth of CD30-positive lymphoma, and obviously that's based on the recently published data of AFM13 in combination with the natural killer cells. We have now a presentation, a key presentation at AFER, and also later in the year, we will have the opportunity to gauge the impact of our treatment on both, not just Hodgkin lymphoma, but we also believe in non-Hodgkin lymphoma patients, which would mean that we have now all the ambition to make AFM13 available to patients with a wide range of CD13-positive lymphoma. And as I said, we're going to provide more updates on that in the second half of this year, in addition to our way forward with the NK cells. AFM24 is a completely novel drug that we designed with a strong innate component and we have now reported the initial data in 2021 and we felt that achieving this milestone with a recommended phase two dose at 480 milligram is now a key milestone to us because we're now testing AFM24 as a monotherapy but also in different combinations in the with the highest likelihood of a response. We're very excited that these studies are ongoing and look forward to present early data in 2022 as we're proceeding. And as we have learned with AFM28, we're addressing an indication where there is a significant medical need, and as Arndt explained, we believe that our platform is ideally suited to build upon the basal efficacy of natural killer cells and potentially induce a deeper, longer-lasting response, again, with a strong rationale now derived from AFM13 and the very meaningful responses we have seen there in combination with the natural chelodonts. So all of us at AFIMED are dedicated to now giving back patients the innate ability to fight cancer. I'm convinced that with the recent data and the thoughtful selection of our programs, We can help many patients that currently have no or very, very limited options. And as we're now learning, there is also more interest from the pharmaceutical industry in this space. We also believe driven by our strong data of AFEM 13. Now, thank you again for listening today and for our continued interest in our work. We're now ready to take any questions.
spk01: If you'd like to ask a question at this time, please press the star, then the number one key on your touch-tone telephone. To withdraw your question, press the pound key. Our first question comes from Dana Graybosh with SBB Lyric.
spk12: Hi, thank you for the questions and the update. I have a couple on ASM 13 and the redirect study. First, I wonder if you could talk about the bar you expect for accelerated approval for ORR and duration of response. And given that bar for duration of response, how much follow-up do you think you'll likely need to be able to exceed that bar? And then the second question is, you know, given you could get accelerated approval here, when will you start thinking about commercialization and could we see some early spend on prepping for launch?
spk13: I would take the first two parts, and then when it comes to commercialization, probably hand back to you or to Denise. So then, as you know, we talked with FDA about the design of the study and then had an alignment on the design. FDA will never give you a clear guidance on what they want to see. If we consider the environment, there are a couple of drugs that have achieved accelerated approval or granted accelerated approval in peripheral T-cell lymphoma. This includes HDAC inhibitors as well as anti-metabolites. Consistently, these drugs have shown response rates in the 27, 28% range. And duration of response is somewhere around 8 to 10 months. So I think this constitutes some kind of a floor, if you will, or a lower basis of what you would need to achieve for also to be considered accelerated approval. Now, in terms of the follow-up, again, it will depend on the duration of the responses. We do have roughly close to a two-year recruitment period, so this will have an impact also on the follow-up. We have not done a real modeling yet. We will do so when we get closer to our top line results that we plan to share with you second half of 2022. And I think for the commercialization aspect, either Adi or Denise.
spk12: I'm happy to jump in here. So thanks for the question, Dana. So you're right. So if we are in a situation where we receive an accelerated approval, the market development on this needs to be happening pretty much now. So what we've done as an organization is we're adding key talent, including experienced oncology marketers who will be joining this month in order to do the appropriate market development. We have key positions in KOL engagement that have been recently added. And we are also adding a key talent in the area of market access and payer strategy who will be joining us in about a month's time. All of these talents that have been added to the organization augments what we already have. We have about between about three of us who have marketing in our background, probably 90 years of pharmaceutical marketing and launch experience across multiple indications. So we feel that we're well positioned to do the appropriate prelaunch market development activities in a very efficient, effective, and focused manner in order to de-risk any commercialization that could happen and come with an accelerated approval. That's very helpful. Thank you very much.
spk01: Our next question comes from Kripa Devarakonda with Truist.
spk06: Hey guys, congrats on all the progress and thank you so much for taking my question. I wanted to ask a little bit about setting expectations for data and second half from AFM 13, the CBNK combo. Now that the FDA has approved multiple cycles, And you've talked about this being a more mature update. Can you help us understand, you know, how many patients? I know it may be a little too early, but just ballpark. And also, when you talk to the FDA later this year, how are you thinking about using this multiple dose strategy in this context? And finally, can we expect anything at ASCO?
spk05: Andreas, do you want to take it off?
spk13: I will start. So, as you know, the study at MD Anderson is ongoing and we are continuing to enroll patients. The amendment allows, as I said, for 40 in total. The initial focus will be on Hodgkin's, but we do have non-Hodgkin's and Puma patients on the study as well. And We will also, the amendment covers 10 non-Hodgkin lymphoma patients with CD30 positivity. So we will really expand our knowledge and our database beyond Hodgkin's. Now, as I mentioned, we have already seen deepening of responses in the low doses. So Of course, ACR will give a better overview also at the recommended phase two dose response rate and CR rate after two cycles. And as we see individual patients, again, the option to administer more than two cycles is at investigators' discretion, but we believe there will be patients who benefit even from more cycles, also given the very excellent toxicity profiles. Now, this totality of data with longer follow-up with more patients with multiple cycles will form our database for the discussions with FDA. And I think we will bring a couple of different strategies forward. As Adi said, our focus will really be to align with FDA and identify with FDA the approved path that brings this important treatment to the patients in the shortest possible period of time.
spk06: Thank you.
spk13: Was there something outstanding? There were so many questions. I'm sorry.
spk06: No, no, you covered everything. I just had one more question. Should we expect anything at ASCO? I know you've said second half is where we can expect this, but any updates planned at ASCO?
spk05: Andreas, do you want to take it? I can take it. We're discussing this with MD Anderson, so any Additional updates currently in this stage are planned together with MD Anderson, so just stay tuned until we announce it appropriately.
spk01: Okay, great. Thank you. Our next question comes from Maury Raycroft with Jefferies.
spk08: Hi. Thanks for taking my questions. I was going to ask one on AFM24. You said in the past for the individual AFM24 dose expansion and combo cohorts that you'd make a go, no-go decision based on initial data in approximately 10 to 12 patients and then expand. I'm just wondering if you can provide more specifics on what you're going to be looking for in terms of number of patients and response rate and durability and what could be included in some of the updates that we see later this year.
spk13: Yeah, thank you, Mark. So as you know, all of the nine expansion cohorts are built on assignment two stage design, which has the first interim look at 10 to 12 patients. And then we will decide whether the specific cohort will continue. We have not disclosed the targeted response rates per cohort as they also vary across cohorts like you look at diseases like pancreatic, it will be a little bit different than in diseases like renal cell carcinoma. If these are open-label studies, of course, we could also give interim updates, which we plan for the second half of 2022. Now, remember that both of the combination studies, so the NK cell combination study as well as the Tizolizumab combination study have safety run in with a little bit lower dose of AFM24 before we can escalate up to the full dose. So there will also be an emphasis, especially in this dose escalation on safety. So this will probably be the data package that you will see at the end of 2022.
spk08: Got it. That's helpful. And maybe a quick follow-up just to clarify. For your poster at AACR, is that going to include follow-up data on the six patients at recommended phase two dose? And will there be any data in the poster from the 720 mg dose cohort?
spk13: There will be some follow-up. As we said, the main focus here is on PKPD and really showing all of the rationale that went into the 480 mg definition as a recommended phase two dose. The 720 milligram cohort is still ongoing, treating patients, so we will not have data on 720 at the poster.
spk08: Got it. Okay. Thanks for taking my questions.
spk01: Our next question comes from Brad Canino with Stiefel.
spk09: Thank you, and nice enrollment progress across the programs. Maybe just a follow-up on Dana's question on AFM 13, and how much durability data would be available at the top-line release? Because you mentioned the trial has been enrolling for about two years, and it finished this past January, so it would be reasonable to expect a median follow-up of around one year, and I guess if that's true, would Would that be sufficient durability to be ready to go towards a registrational prep pretty soon after that? Thank you.
spk13: Andres? Yes. We have not done a detailed modeling. I think your assumption that we should have a median follow-up around 12 months is probably correct. Again, we will have to look at the kinetics of the progressions to make a call how mature these data are, how many potential events are still outstanding. After the interim analysis that we conducted after 20 patients, we have really not looked into the database to protect the integrity of the data. So, This was something that we will address when the data come in between now and the disclosure of the high-level data.
spk09: Okay. Thank you.
spk01: Our next question comes from Lee Watzek with Cantor Fitzgerald. Hey, guys.
spk11: Thanks for taking the call. Maybe first on the upcoming ACR presentation, I'm just wondering if you can help to sort of set the expectations for investors. I mean, is the main focus sort of on the response after the second cycle, or is there anything else that we should be focusing on? And also, can you share what kind of data that you need to see before you approach the FDA regarding the registrational path for the NK combo? And can you also talk about maybe different outcomes that you're preparing for? Thanks.
spk05: Andreas, again?
spk13: So for ACR, as I said, we will have a focus, of course, on response data. Now that all 13 patients are fully treated with two cycles, Of course, there is longer follow-ups, so there will be also these data available. There will be toxicity data. There will be some initial translational research data. So I think it's a quite comprehensive package, and I think being selected for the plenary session is probably also an interesting side remark. So we are really looking forward to these data. Now, in terms of FDA discussion, as I mentioned, we, of course, look into broadening our experience with a more heterogeneous patient population, which will enable us to discuss a couple of different pathways. As Adi said, we are also looking at NK cell biology, NK cell sources. So this will play into the timing of a potential FDA discussion and we expect to give an update, as Adi said, the second half of this year.
spk11: Okay, got it. I also have a follow up on AFM24. I mean, you're testing a lot of settings in extension cohorts and just wondering if you could Give us some guidance on the cadence of the data flow this year. I mean, should we expect data from certain cohorts maybe to read out earlier than others? And should we assume that we might see some interim data read out from any of the cohorts this year? Thanks.
spk13: I think it's too early to specify which and whether cohorts will enroll at a different phase. Of course, there are some differences in the frequency of certain diseases, non-small cell line cancer, colorectal cancer, probably a little bit more frequent. As we are interested in all of these indications, we have on the clinical operations front specifically added also some sites with high volumes of rare cancers like hepatobiliary cancers or renal cancers. So before we see the enrollment in those various sets, I think it's too premature to speculate whether a certain cohort may be faster than another. We believe that the biological rationale for all of these cohorts is very sound, and that's also the feedback we are getting from our investigators who have come on board. All three studies are open and are enrolling patients. So again, we are confident with our guidance to show initial data second half of 2022. But in which cadence this will come, this I think will shape out as we get a little bit more experience across the different sites and across the different cohorts.
spk01: Got it. Thank you. Our next question comes from Yale Jen with Laidlaw.
spk10: Good morning and thanks for taking the questions. I got one from an investor, which is that recently some of the single-arm or maybe non-randomized study initially seeking for auxiliary approval has been sort of rejected by FDA and the do you see any sort of potential impact on the redirect future path, or you feel this is a very different sort of type of drug versus others being treated that way?
spk13: I think in accelerated approval, it's very hard to make any kind of, conclusions from one study or one setting to the other setting. So the FDA has been quite clear in what they like to see. First of all, you need to perform your study in an area of unmet medical needs, which after discussion with FDA, I think we have a good definition here. And then you have to provide a robust data set that is likely to predict through a surrogate marker finally clinical benefit. And again, this, especially in oncology, really varies where we have certain settings where response rate alone is predicted for clinical benefit, certain settings where response rate in combination with duration of response will be regarded as an adequate surrogate. And you have other settings where response rate does not correlate with clinical benefit. And these settings, of course, are not are suitable for an accelerated approval. We addressed all these points in our initial discussions with FDA, so we would not see or I would not see any kind of cross effect from the fact that a certain study in a certain setting was not granted accelerated approval to the redirect study. It's always a standalone issue with these variables that I said, but if you control and then show these variables, I think, you have an approval of the data set.
spk10: Okay, great. Maybe just one quick follow-up for Avi, which is that you mentioned that after the reporting of the AFM 13 data, end of last year, you're getting additional sort of partnership, I guess, discussions. Do you feel that AFM 13 could be potential also to be partnered, or this is something you want to keep in-house? for moving further?
spk05: Good question. So what we have been doing since December, we've had numerous meetings with the pharmaceutical industry, and we're still consolidating the interest we're seeing. So in essence, we have been starting to prepare a commercial team that is capable of taking drugs forward. Now, the partnering can have a lot of facets It can be a pure ad licensing. It can be a co-commercialization. So we're now exploring this and see what the benefit is. But what I should say is the interest in what we do is broader than just AFM 13. And AFM 13 has a strong read-through into AFM 24 and also AFM 28. So there are numerous opportunities, including our pipeline we haven't mentioned that we have early stage candidates identified similar to where you come 32 so you see it's a whole menu what are we focusing on so we're not just like somebody comes and can pick we have put a a model behind every of our drugs what we would want to achieve we have looked at the cost on how to bring these drugs to market and then we are eventually where so Basically, we have firm touch sheets built internally under which conditions we would want to do this or we wouldn't want to do this and when it would make sense. So that gives us all the optionality from a point of where we have a high degree of knowledge, know-how, in order to move forward. Another question, another answer is, for example, do we have to partner? No, we do not. Completely, it remains at the discretion of Afimet what we want to do and what we can do. Main reason is we have a reasonably strong cash position, I would say, and a lot of data coming up. So we can also in parallel see on the interest of all our investors, of all our shareholders, in order how this is supported. So we're very flexible, and that's something that is important to us.
spk10: Okay, great. That's very helpful, and congrats on all the progress at this point. Thank you.
spk01: Our next question comes from Shixiong Xu with Barenberg.
spk03: Great. Thank you very much. I have a few questions on the AFM 13 program. Maybe the first one to follow up on the potential accelerated approval in PTCL. If I recall correctly, the last X-ray approval was granted probably more than 10 years ago. And given the evolving landscape, actually evolving attitude from the FDA on the single arm X-ray approval, you point out a surrogate endpoint of ORR. But we also see last year Bristol pulled out their HDAC inhibitor in the syndication. Granted, it's a different mode of action, but how do you see that can change the dynamic with the FDA? And then just related to that, have you planned any phase three confirmative trials to support this accelerated approval?
spk13: Yeah, so... It's a long list again, Andreas. Yeah. As I said, I think it's very hard to make any predictions or conclusions from one case of accelerated approval or non-granting of accelerated approval to another case. And as I said, when we were with FDI, we discussed many of the characteristics that would be required for a data set that could support accelerated approval. We have not, or I would not say that the landscape has fundamentally changed. Again, the removal of the HDAC inhibitor was a very specific story. And so I do not see a read-through to what we discussed with FDI when we started the redirect study. Of course, the prerequisite is that the data are strong and consistent to support such surrogate endpoint and a likely association with a clinical benefit. But that's something that we will learn simply when we have our top-line data available. Now, one of the requirements for accelerated approval, of course, is that you will have to have a confirmatory Phase III study. And we are currently looking into different options how a Phase III study could look like. have had an advisory board with PDCL experts to discuss some of these options. We will follow up. So if we should decide based on the data to go for an accelerated approval, I think we also will have an appropriate phase three or confirmatory study design to discuss with FDA.
spk03: Great. Maybe just to follow up on the FM13 with NK cell pre-complex trial. Last time you discussed the potential to make the trial become a company-sponsored trial. I wonder what the progress there. Last time you disclosed you have identified a CDMO. Maybe can you provide some updates on that?
spk05: Yeah, nothing has changed on what we said in the past that we're working on the, so with the CDMO, we are working in order to produce the in case health product. Ambition is obviously to have a cryoprocessed in case health product. We have exploring all our engages with different in case health products from other companies. So we have been indeed learning a lot around the opportunity to either pursue our own independent cell or to then do this in collaboration. We'll let you know more about that in the second half of this year. As all of that is progressing, that will also include then the strategy on how to take this drug forward into a registration-directed study. Obviously, the strong data that we are currently generating is the basis. We now have it to a heart-cooled lymphoma Andres explained that this can expand to additional lymphoma. All that obviously is valuable once we have a robust data set. We're aiming at getting to this very robust data set. And once all that's together, we can then take basically the strategy forward and bring it to you. So it's yet premature. We'll be too speculative as of today. But it's all maturing on our end.
spk03: Great, thank you. Maybe just if I can squeeze one question, last question for AFM24. Maybe for Anders, can you talk about the overall confidence in each cancer types? Do we expect to have a go, no-go decision in the second half for each cancer type? Thank you.
spk13: As I said, we cannot make predictions on how many of these cohorts progress at which speed as we are starting right now. We have selected these cohorts very carefully. We believe that each of these cohorts has a potential to show activity that could be clinical or will be clinically meaningful. So it's exciting for us. And as I said, we are currently enrolling patients in all three studies. So we will see the data in second half of 2022.
spk03: Great. Thank you very much.
spk01: Our next question comes from Do Kim with Piper Sandler.
spk04: Hi, audience team. Thanks for taking my question. Just one on AFM24, the combination with NK cells. I was hoping what you could tell us about NKGEN's autolysis NK cell process. Does it have the standard lymphodepletion? Is there a bridging therapy involved? And maybe, is this a potential option for the AFM13 combo? Or are you sticking with donor and case health there?
spk05: Andrea?
spk13: Yeah, let's start with the protocol that we currently have. The SNK01 cell is an autologous cell. So that's very different from the MD Anderson approach where we have allogeneic cells. So the autologous cell is basically derived from the patient. We are getting cells through leukapheresis. And then NKGEN has developed a methodology to significantly expand and activate these cells ex vivo, and then we are re-infusing the NK cells. Now, the number of NK cells that are infused, re-infused, are significantly higher. It's four times 10 to the nine. But also, unlike MD Anderson, we are giving weekly NK cell infusions. So MD Anderson is one infusion per cycle, and then followed by three weeks of AFM-13. Here we are giving AFM-24 weekly and NK cells weekly, so 4 times 10 to the 9 NK cells per week to these patients. So a very different concept now. Since these NK cells are derived from the patient individually, we do not need lymphodepleting therapies. The role of lymphodepleting therapy in NK cell-based treatments is to suppress the patient's own T cells, which would otherwise reject the allogeneic NK cell. And we have learned that with one course of lymphodepleting therapy, you have a window of approximately two weeks, and then the patient's own NK cell, own T cell compartment comes back and would reject allogeneic NK cells. So this is a reason why we cannot, for example, do weekly allogeneic NK cells. Now we selected all the NKGEN cells specifically as they have shown activity, moderate activity or modest activity, but activity in combination with pembrolizumab in non-small cell lung cancer and also in combination with an EGFR targeting agent in some sarcoma. So there is basal activity, and we believe that the synergy between an ICE and these NK cells is something worthwhile to be explored. Now, we also, as I said, look at different other NK cell sources. So there is clearly the option to also look at allogeneic NK cells in the context of solid tumors. But as I said, the current study is addressing autologous NK cell
spk04: Great. Congrats on all the progress. Thank you.
spk01: I'm showing no further questions in queue at this time. Ladies and gentlemen, that concludes today's conference call. Thank you for participating. You may now disconnect.
Disclaimer