Agenus Inc.

Good afternoon, and welcome to Agenis, Inc.' 's investor briefing call. Currently, all participants are in a listen-only mode. A question-and-answer session will follow the formal remarks. As a reminder, this conference is being recorded. I will now turn the call over to Zach Arman, head of investor relations.

Thank you, operator. Welcome to Agenis' investor briefing call. Earlier today, we issued a press release announcing a strategic collaboration between Agenis and Zytus Life Sciences, which we are here to review in more detail with you today. A copy of the press release is available on our website at www.investors.agenisbio.com. Before we begin, I'd like to remind everyone that today's discussion will include forward-looking statements. These statements are subject to risks and uncertainties, which may cause actual results to differ materially from expectations. Please refer to our SEC filings for further detail. Joining me today are Garrel Arman, Chairman and CEO, and Dr. Stephen O'Day, Chief Medical Officer. I'll now turn the call over to Garrel Arman.

Thank you, Zach, and good afternoon, everyone. Thank you for joining us. On today's call, we will be discussing an exciting new partnership between Agenis Enzytis. It's an exciting opportunity for both companies and for trade between two great nations, the world's oldest democracy and the world's largest democracy. But before I get into the details, I want to start with why this is so important. As you've been hearing lately, colorectal cancer is on the rise, particularly among the younger people under the age of 50. Colorectal cancer, which is known as CRC, incidences have doubled in the US adults under 55 from 1995 to present. By 2030, colorectal cancer is projected to become the leading cause of cancer-related death in men under 50, that is in the USA. These younger patients, especially need treatment other than chemotherapy, radiation, and life-altering surgeries. They deserve an alternative with life-changing side effects. And this was, by the way, a major topic of discussion at the ASCO meeting, which I attended, along with 75 to 80 meetings that we had with KOLs and investigators who came to meet with us without getting paid a penny. I must stress the importance of that. The new leadership at HHS and the FDA recognize what I just said. One of the president's first action with Secretary Kennedy was to set up the Make America Healthy Again Commission, which is focused on investigating the causes of America's worsening health trends. The commission issued its report last month And one major area of focus was the rise in cancer incidences among younger people. This is alarming. Secretary Kennedy has pledged to root out conflicts of interest. And the FDA commissioner, Dr. Marty Makary, has repeatedly stressed the need to accelerate approval of meaningful treatments. I underlined meaningful treatments in this context. This shifting regulatory environment is deeply encouraging to us and for the entire research community who is discovering and developing novel and effective therapies, not incremental therapies that extend life by marginal timelines, a few weeks to a few months, with horrible side effects. And so it is an exciting time at Agenis. We have new data, we have added to our leadership, and now we have a new partnership and a new environment at the FDA. We'll talk about these one by one. Let's talk about new data. Phobotansilumab and Bostromab, which we call Bot-Bal, and by the way, the entire community now has started calling it Bot-Bal, We are generating consistent and compelling data across different lines of treatment, both in the neoadjuvant setting, all the way down to major lines of treatment for patients that have exhausted every single available therapy. And this is happening across multiple cold tumors that have historically defied standard immunotherapy treatments. These include MSS colorectal cancer, which, by the way, accounts for more than 85% of the colorectal cancer cases, certain hard-to-treat breast cancers, like non-small cell lung cancer, I'm sorry, triple negative breast cancer, sarcomas, which have been a traditionally difficult target for patients, and hepatocellular carcinoma, among others. As I mentioned, I just got back from my school in Chicago, where we presented translational data showing that butt valve elicited a response in MSS tumors, which, as I said, historically had not responded to any immunotherapy to speak of. Now, all of this Bill spoke of Dr. Miriam Chalabi's presentation at AACR in late April of this year. Dr. Chalabi presented results from investigator-sponsored NeoASIS 10 cancer study trial in the neoadjuvant setting. This study showed pathologic complete responses across multiple cancers. And importantly, no dose-limiting toxicities, and all patients proceeded to our next level of treatment, like surgery, on schedule. As Dr. Chalabi stated, these findings substantiate the importance of this immunotherapy in early treatment settings and highlight the broad potential utility of this combination, as she was talking about that time. Let me spend a second on new leadership that we've added. To support this next phase of development, we recently welcomed Dr. Richard Goldberg, a world-renowned GI oncology expert, as our chief development officer. He was with us at ASCA as well. His leadership will be pivotal as we advance towards reengaging the FDA for metastatic CRC and down the road for other tumor types as well. Now let's come to new partnerships and new opportunities. And of course, today is about our new partnership and new opportunities. It's expected that United States will reach a trade agreement with India any day now. And in both countries, there is renewed sense of confidence in Indian American relations and trade. Leaders in America recognize the need to secure America's biopharma supply chain. Very important part of the agenda here. For all these reasons, now is a great time for this particular agreement that we entered into today. And that is why we decided it's now, it's now that's the right time to move on to this kind of agreement. I believe this agreement And our relationship will benefit Agenis and Zydus, but also our two great countries, which are already great trading partners. Let me go to slide two, if I may. And slide two talks about the strategic collaboration unites Agenis' pioneering research and development capabilities with Zydus worldwide manufacturing and operating strengths. Now, if you sort of take a step back and look at the reasons why we consummated our Emeraldville strategy to make commercial-grade products, I might add state-of-the-art facility that will make this commercial-grade product, it has to do with the fact that we wanted a reliable, consistent, means of supplying in the event that our expectations and patients' expectations came true, that BOTVAL became a standard for the treatment of many difficult-to-treat cancers. That was the original reason why we did this, because at that time, we realized that it would have been too risky for us to just depend on traditional CDMOs. Now, what I'm delighted to announce with this agreement is that even though this transaction transferred the ownership to Zydus, we have the same drivers of integrity, reliability, efficiency, and quality in Zydus in a facility that we've built and with a team that has played a major role in building this facility and running it right now. So that's one of the reasons why having this partnership with Zydus makes our relationship, not just in the context of generating additional funds for our own company, but also looking at the future and anticipating that future with a reliable partner. Okay. Now, this partnership and the divestiture of our non-core assets mark a new chapter for us for the reasons that I've told you. Agenis 2.0, that's sort of a good way of conceptualizing our next chapter, a focused innovation engine with a clear path to value generation through its streamlined execution and smart partnering. That is the desired outcome. and this is what we expect to execute on. For those of you joining that may not be as familiar with Gydus Log Sciences, they're a leading global pharmaceutical company with a fantastic reputation in India and beyond. With an 11 billion market cap, it is headquartered in India, employs over 27,000 people across 55 countries. including the United States. They bring deep expertise in manufacturing, clinical development, and regional care delivery, with $2.6 billion in 2024 revenues and an expanding chain of multidisciplinary hospitals and trial infrastructure across Southeast Asia. Now with this, Genesis positions for substantial value creation through a layered approach that integrates scientific advancements with commercial foresight fortitude. Now, this is an interesting chart, and it tells you what our first phase of execution is, which is block-bound approval in the U.S. being our focus. Next, of course, will be Europe shortly thereafter. And then after that, We have huge opportunities in indication expansion, other market approvals, and also very importantly, and this was highlighted, by the way, at a number of our meetings at ASCO by some of the world leaders in immuno-oncology who understand how immuno-oncology works. And their mandate is to help the system understand how immuno-oncology works and how the endpoints should be evaluated in the context of immunological effect on the tumor. So we are positioned today for substantial value creation through a layered approach that integrates scientific advancements with commercial foresight. Together we're combining scientific innovation and global operational strength to unlock the full potential of BotVal and expand our research and to expand our patients worldwide. Strengthening financial foundations, of course, is key. And our focus strategy of capital infusion to power eugenics plays a major role in that. And having a like-minded partner is one of the best ways of accomplishing this. So with this transaction, we are divesting our non-core assets, which are hard assets. Manufacturing is not our sweet spot, but it happens to be Zydus' sweet spot. That doesn't mean we haven't excelled in manufacturing. It simply means that we have very important agendas to execute on with innovation and bringing these products to patients as soon as possible. And Zydus will be a very important part of that execution. So looking at the deal structure, in addition to the $75 million up front and the $50 million in contingent payments, we're also planning the divestment of land assets valued at $40 to $50 million in the second half of this year. Of course, these types of transactions can be delayed. So with that qualification, our intent is to monetize on our real estate assets in California that are not part of this deal. And, of course, together, we also have the 16 million equity investments from Zydus, which is also a very big vote of confidence in us at $750 a share. We're reinforcing our balance sheet, reducing our cash burn, and focusing our capital where it derives the most value for us and our shareholders, and also, very importantly, for our patients. are in need of an innovative and potentially curative product our vision is centered on both science-driven innovations and of course butt bell is the lead in this but we have a whole bunch of clinical stage products behind but that innovation only delivers impact if it reaches patients efficiently and that's why we are concentrating our resources on u.s and U.S. Registrational Trials for BPAL, with an understanding that our moral responsibility is to go beyond the U.S. as soon as possible, and India is one of those territories. And while integrating Zytus's advanced analytics to streamline our development, improve trial design, and optimize patient selection will be critical. Remember Zytus. is a company that's not just in pharmaceutical manufacturing, but they own a number of hospitals in India, including a cancer-dedicated hospital, as well as a CRO that advances clinical trials not just in India, but also other countries. I had the pleasure of visiting India several weeks ago and visiting three of their hospitals and also visiting with their CRO. And this is a meeting of the mind that has emerged to consummate this transaction. So our vision is centered on bold, again, science-driven innovation, but that innovation only delivers impact if it reaches patients efficiently. That's why we are concentrating our resources on U.S. registration, as I said before. The key is in our clinical trial development, reducing timelines, lowering costs, and ultimately accelerating our path to regulatory approval. That is key. And having the ability to integrate with some of the subsidiaries or related companies of Zydus and execute clinical trials at record pace and allowing that to inform what clinical trials and what combinations and what indications should be pursued in the U.S. is a very substantial advantage that will add value to Agenis and, very importantly, value to Zytus. So, through this partnership, as I said before, we gain access to Zytus's extensive clinical trial networks across India and beyond. And, of course, this accelerates our ability to bring BustBio to more patients and more indications leveraging their operational scale alongside our scientific leadership. We also see significant strategic value in combining Buck with upcoming PD-L1 biosimilars, PD-1 and PD-L1, I might say, that ZYVIS will be manufacturing. They're already well ahead of their competition in this area. And this will give us an opportunity that could help unlock the current $50 billion global market segment in immunotherapy by adding BOTS strength to the current state of affairs in immunotherapy, which reaches less than one-third of the eligible patients. But our expectation is that with BOTS infusion, into these combinations, we can significantly expand that market. Significantly expand that market. So with this partnership, Agenis is executing a dual pathway to Strategy 4.0 prioritizing U.S. registration trials while simultaneously leveraging Zytus's extensive infrastructure to advance development in emerging markets. This, by the way, allows us to accelerate approvals. It is a model that pays scientific innovation with operational scale to maximize patient impact and shareholder value. Patient impact must be the driver for shareholder value, not the other way around. And in conclusion, with new data coming at ESMO in July, Continued regulatory engagement, both in the U.S. and in Europe, and now through ZYBIS, we expect this to be with India as well. And new regional partnership discussions underway. Agenis is positioned not just for progress, but for transformation. That is the Agenis 2.0 vision in action. science-led partner-enabled and patient-focused strategy. Now, in conclusion, I just want to divert your attention to one thing, and that is the team that worked tirelessly over the past months and continues to work tirelessly for potential additional transactions is the team that we would like to reward, and that is the subject of our asking at our shareholder meeting for resolutions. So as a final note, we will have our 2025 shareholder meeting on June 17th, and it is critically important that all shareholders of Agenis resolve April 24, 2025 record date, quote, very important. Agenis' proxy solicitor, Alliance Advisors, has been with us for over 10 years. is available to assist you with your voting of shares, even if you do not have access to your proxy card. This could be done on the phone. Their phone number is 844-202-6561. And you can also email them at agen at allianceadvisors.com. And please do this as soon as possible to ensure that the team who delivered on this transaction is motivated and continues to work to deliver and expand on this transaction and more. Thank you very much for your continued support. And operator, Tiffany, we are ready for questions.