BioAtla, Inc.

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by, your program is about to begin. If you need assistance during your conference today, please press star zero. Good day everyone, and welcome to today's BioAtla second quarter 2024 earnings call. At this time all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question and answer session. You may register to ask a question at any time by pressing star one on your telephone keypad. I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Bruce

Mackel of Lifesite Advisors.

Thank you, Operator,

and good afternoon everyone. With me today on the phone from BioAtla are Dr. Jay Short, Chairman, CEO, and Co-Founder, and Richard Waldron, Chief Financial Officer. Following today's call, Dr. Eric Sievers, Chief Medical Officer, and Sherry Lydic, Chief Commercial Officer, will join Jay and Rick in a short Q&A. Earlier this afternoon, BioAtla released financial results and a business update for the second quarter ended June 30, 2024. A copy of the press release and corporate presentation are available on the company's website. Before we begin, I'd like to remind everyone that statements made during this conference call will include forward-looking statements, including, but not limited to, statements regarding BioAtlas business plans and prospects and whether its clinical trials will support registration, plans to form collaborations and other strategic partnerships for selected assets, achievement of milestones, results, conduct, progress, and timing of its research programs and clinical trials, expectations with respect to enrollment and dosing in its clinical trials, plans and expectations regarding future data updates, clinical trials, regulatory meetings and regulatory submissions, the potential regulatory approval path for its product candidates, expectations about the sufficiency of its cash and cash equivalents to fund operations, and expectations regarding R&D expense and cash burn. These statements are subject to various risks, assumptions, and uncertainties that can cause actual results to differ materially and are described in the filings made with the SEC, including the most recent quarterly report on Form 10Q. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today, August 8, 2024, and BioAtlas disclaims any obligation to update such statements to reflect future information, events, or circumstances, except as required by law. With that, I'd like to turn the call over to Dr. Jay Short. Jay?

Thank you, Bruce, and thanks to everyone for joining us for our second quarter 2024 BioAtlas earnings call. Additional details related to what we will share today are available in today's press release and our updated company presentation, which are available on our website. Also the presentation and webcast of our R&D Day held two weeks ago, featuring three renowned KOLs, are also available on our website. We continue to make considerable progress across all of our ongoing clinical programs. Beginning with our -O-Zuristum abdodotum being evaluated as a monotherapy and highly treatment refractory head and neck cancer patients with a median of three prior lines of treatment, we shared last quarter that among the 29 available patients, 11 responses were documented at the combined two Q3W and Q2W dose regimens, with six responses now confirmed. We have an abstract accepted as a poster presentation at the upcoming ESMO conference and look forward to sharing the updated data in September. Additionally, we continue to see a manageable safety profile with no new safety signals to date. Given the strength of the data, we recently received a fast-track designation from the FDA, which represents an important recognition of the potential of a Zuristum abdodum to potentially fill a significant unmet need in refractory headed neck cancer. The encouraging clinical profile supports rapidly advancing into a potentially registrational trial evaluating monotherapy treatment versus investigators' choice in the second line and beyond setting. And we are on track to meet with the FDA later this year to discuss further. Moving now to our CAHBS-C2A4 antibody, Ivaustatug, as presented during our R&D day, we have treated 40 patients across multiple doses of Ivaustatug and we continue to observe low incidence and severity of immune-related adverse events in the combined safety from our Phase I and Phase II studies. Specifically, a relatively low rate of Grade III immune-related adverse events were observed in only four out of 40 patients with no Grade IV or V-related treatment emergent adverse events. The incidence and severity of immune-related AEs were consistent across both Phase I and Phase II studies. With regards to efficacy from our Phase I study, we previously reported confirmed responses for three of eight treatment refractory patients using the 350-milligram dose in combination with a PD-1 antibody, including one complete response with one additional partial response that according to the attending physician showed no evidence of disease and may eventually be ruled a second complete response. No dose interruptions occurred in patients treated with greater than or equal to 350 milligrams of Ivaustatug and multiple patients have remained on therapy for more than one year without progression. These data are consistent with the anticipated benefits of our conditionally binding technology. Initial data from our Phase II monotherapy study across 14 different treatment refractory solid tumor types at 350 milligrams or 700 milligrams showed 10 patients with stable disease and multiple patients experienced prolonged progression-free survival for greater than 10 months. We look forward to presenting the data at several upcoming medical conferences, including an oral presentation at the Society for Melanoma Research Congress in October and a poster presentation at the Society for Immunotherapy of Cancer in November. We continue to enroll in the Phase II first-line melanoma study, followed by mutated -small-cell lung cancer using a combination of Ivaustatug and PD-1 antibody. We are on track for an initial data readout of melanoma later this year. Based on our evolving data, we continue to believe Ivaustatug has the potential to be the best in class CTA-4 antibody that holds the promise to be used as often as a PD-1 antibody and potentially expand the indications where combined immune checkpoint inhibition can be effective. We are now designing a blinded randomized pivotal trial employing Ivaustatug plus PD-1 antibody for newly diagnosed metastatic or unresectable melanoma patients and anticipate FDA guidance in the second half of this year. Now on to our CAB Axil-ADCF Macboda-MAP Thedotin. As part of our Phase II trial on patients with -small-cell lung cancer, we have completed an additional expansion cohort of 33 patients to evaluate axil expression, dose, subtype, and safety. In our subgroup analysis, we observed that axil expression of greater than or equal to 1 percent is correlated with clinical benefit in heavily pretreated patients with a median of three prior lines of therapy. We further evaluated the genotype status in this heavily pretreated patient population with tumors expressing multiple K-RAS mutation variants, including G12A, G12C, and G12D. Among the 18 evaluable patients with known K-RAS mutations, we observed five responders, including one responder whose tumor expressed a mutated K-RAS G12C variant and has experienced prior failure of SotoRapsids. In addition, we have a patient with a complete response that has been maintained now for over two years, demonstrating encouraging clinical benefit in this emerging opportunity in patients with mutated K-RAS variants. Importantly, our initial findings support a trend for improved overall survival among patients with tumors expressing mutated K-RAS variants compared to the K-RAS wild-type genotype. Furthermore, a manageable safety profile continues with no new safety signals identified in this patient population. We continue to assess K-RAS expression across the Phase II dataset and look forward to providing an update and additional details regarding a potential path forward later this year. Regarding our Phase II potentially registrational trial in undifferentiated pleomorphic sarcoma UPS, we are evaluating the initial 20-patient dataset and will provide an update on the remaining portion of the registrational trial later this year. Now in our Phase I-II dose escalation study for -CAB-CD3 T-cell Engager, the study is progressing and ongoing. We remain on track for a Phase I data readout in the second half of this year. The T-cell Engager space offers tremendous opportunity for more effective therapies, and in particular, our CAB-enabled EpCAM T-cell Engager has the potential to treat patients with a wide range of metastatic tumors, including cancers of colon, lung, breast, pancreas, prostate, among others. Finally, we are in meaningful discussions regarding potential strategic partnerships with multiple companies evaluating selected preclinical and clinical assets. The current stage of these discussions support our belief that we remain on track for establishing one or more collaborations this year, including for one of our Phase II clinical assets. With that, I would now like to turn the call over to Rick to review the second quarter 2024 financials. Rick?

Thank you, Jay. Research and development expenses were $16.2 million for the quarter ended June 30, 2024, compared to $31 million for the same quarter in 2023. The decrease of $14.8 million was primarily due to completion of preclinical development for our -4-ADC, which received IND clearance in May 2024, and the impact of prioritization of our clinical programs in 2023, resulting in less expense for our preclinical programs in 2024. Our clinical program expense decreased due to completion of Phase II enrollment for our ongoing ADC trials for Mequotamab modotum and Ozoriftamab modotum. We expect our R&D expenses to continue to decrease in the near term as we complete our planned Phase II clinical trials and meet with the FDA to discuss potentially registrational trials for our Phase II programs. General and administrative expenses were $5.8 million for the quarter ended June 30, 2024, compared to $6.2 million for the same quarter in 2023. The $0.5 million decrease was primarily due to lower stock-based compensation expense. Net loss for the quarter ended June 30, 2024, was $21.1 million, compared to a net loss of $35.8 million for the same quarter in 2023. Net cash used in operating activities for the sixth month ended June 30, 2024, was $50 million, compared to net cash used in operating activities of $46.7 million for the same period in 2023. Our cash used for the quarter ended June 30, 2024, was $19 million, compared to $30.8 million during the quarter ended March 31, 2024. In line with our operating plan, we expect a further reduction in overall cash utilization in the third quarter of 2024. Cash and cash equivalents as of June 30, 2024, were $61.7 million, compared to $111.5 million as of December 31, 2023. We expect current cash and cash equivalents will be sufficient to fund planned operations, including our prioritized CAB programs through the third quarter of 2025, which is sufficient to deliver clinical readouts in multiple indications, position our programs for one or more potentially registration trials and enhance opposition in advancing strategic collaboration discussions. And now, back to

Jay. Thank you, Rick. We are pleased with the considerable progress we have made to date and our cumulative results across our CAB pipeline targeting solid tumors. We continue to focus on finalizing the data readouts and reports for our CAB Axil, CAB and CAB C2A4 assets and look forward to presenting Word 2 and C2A4 data at upcoming medical meetings, as well as keeping you updated on our business activities. With that, we will turn it back to the operator to take your questions.

At this time, if you would like to ask a question, please press star 1 on your telephone keypad. You may remove yourself from the queue at any time by pressing star 2. Once again, that is star 1 to ask a question.

We will pause for a moment to allow questions to queue. Our first question comes from Brian Chang with JP Morgan. Please go ahead.

Hey, guys. Good afternoon. Thanks for taking our questions. Maybe just first on Axil and UPS. Can you confirm if you have met with the FDA on the remaining portion 4 in the registrational study? If so, what is the initial feedback from the agency? And just furthermore, can you give us a bit more color on the patient compliance and safety profile that you saw in the initial communications? And I have a quick follow-up. Thank you.

Eric, this one sounds like it's for you.

Great. Thanks, Brian. So as we previously disclosed, we had a conversation with the FDA about McBodumab Vodotin in undifferentiated preomorphic sarcoma. And we discussed Project Optimus requirements. We discussed treating at two different dose levels. We discussed the potential bar for accelerated approval with a single-arm trial data set. We have not met with the agency yet with regard to our recent enrollment of the additional patients. And we would plan to review our data and then update on this later in the second half of the year. And Brian, I think you had additional questions about overall safety. Is that right?

Yeah. And I guess just from the initial 20 patients, I think you can provide any color on the patient compliance and any initial read on efficacy and safety that will be very helpful.

Sure. But I think on the efficacy, we're not able to… I was just going to say on the efficacy, we're not… Because it's part of the potential registrational trial, we're not able to update publicly on that. But on the safety, I think in general, Eric, at a high level, you certainly can update that.

Yeah. I'm happy to do so. Certainly, no new safety findings have been identified with the ADC. And we did decide that giving the drug on the -2-4 regimen was… We didn't see much patient compliance with that coming in so frequently to clinics. So we really focused on the days one and eight regimen of a three-week cycle.

Okay. Maybe just lastly, just on the partnership or BD funds, can you just talk about your level of confidence, whether you'll be able to lock in a potential deal in the back half of this year? And as you think about the potential partnerships that are on the table, which potential assets do you think would make the most sense to partner off based on the current data? Thank you.

And so I'm fairly confident that we're going to be successful in establishing partnerships, one or more, in this remaining portion of the year. I think we, as I mentioned in the script, we also may see a partnership as part of that in the preclinical assets. When it comes to the… I think the ADCs are certainly getting the most limelight in discussions. And so I think it's a little difficult to predict for sure which one would partner first, but I'd say both are potential candidates. We like them both. So I think we remain on… We feel we remain on track for that as best one can forecast. And the discussions are clearly at a meaningful level. And so we're

very encouraged, Brad.

We'll go next to Tony Butler with Rodman

and Renshaw. Please go ahead.

Hi, this is Tasha Dasan on for Tony. The question is about the Axel ADC. I seem to recall that the patient with the complete response received the combination. Now, as it pertains to the combination, I wonder if you can characterize what you see since the last data update when it comes to, let's say, seeing a potential deepening of response or patients who are not quite there when it comes to having a response getting close to that negative

30% mark. So it's Eric Sievers

again. So if I can clarify, I think you're asking about our relatively mature data set now with Macbotam-Avodotin in non-small cell lung cancer, and you commented on the CR patient that we've reported previously. And then I think the second part of your question was asking about whether we've seen deepening of some of these responses over time. I think I'd probably best to refer everyone to slide 45 in our updated corporate deck where we are characterizing the confirmed responses across the KRAS mutation variants. Interestingly, one of our responses is a CR patient, and then also direct folks to slide 46, which is a preliminary analysis suggesting a difference in outcome amongst patients expressing the mutated KRAS versus wild-type KRAS genotype. So we are continuing to witness the data evolving over time. This is our current data set that we've made public and look forward to continuing to evaluate the evolving KRAS story. I want to indicate that 21 of the patients still have a pending genotype, and we're categorizing them as either wild-type or mutant so we can further this preliminary finding.

I understand, and thank you for that. Furthermore, how would you characterize responses and or clinical activity that the disease control duration longer than and fewer than 16 weeks with the combination of Mifotum, Avidotin, and Nibolumab in patients whose serous mutation status is either unknown or wild-type?

So looking at slide 45, we're seeing a duration of responsive 4.8 months for those with the mutated KRAS. I think that the survival curves give a suggestion of a somewhat lower PFS amongst the patients with a wild-type KRAS, and we've not performed a formal analysis of the 21 individuals that are unknown. So I look forward to a future data presentation in the medical congress where that will be

disclosed. I do think it's a fairly competitive profile given the fact this is effectively a fourth line, median fourth line set of patients.

Thank you. As a reminder, if you'd like to ask a question today, please press star one. We'll go next to Arthur He with HC Wainwright.

Hey, good afternoon, guys. Thanks for taking my question. So I had a couple quick ones. So for the EXO program, regarding the UPS study, if I understand correctly, you have the additional 20 patient data, and as of now, you're just going to be waiting for the data to take to the FDA. Meantime, are you still enrolling patients in the program?

We are not enrolling patients at the moment. We're waiting for the three total scans and evaluating the data as it comes in, and then we'll proceed from there. I see. Thanks, Jake.

And for the non-small cell lung cancer study in the future, my take is you probably got to taking the KRAS status as well as the EXO status together to select the patient, or you might go for either one.

I

think

it could be either one, but I think right now we see a nice correlation on MKRAS. It just happens to be that Axl is highly correlated with that. So it's not necessarily required that you have that Axl expression. We clearly see benefit with our drug with Axl expression. So when we finish the next 21 patients analysis, obviously we'll be comparing that and coming forward with how we think it best be carried out.

You got it. Can I add to that too? Because Arthur, I think that it's a great question. And as Jay said, these are evolving data. We're looking at the 21 patients to see how they sort out between mutated and wild type. But it's conceivable that if the KRAS findings are further supported with additional data, given that that's a standard assessment, the genotype of lung cancer patients is very standard for defining the appropriate treatment options, that this would enable a pretty straightforward approach for defining a population experiencing pronounced clinical benefit. Again, illustrated in slide 46 with the difference of survival that we're seeing. Now, that could be biologic differences between those two subgroups of patients. It also could be due to the drug.

Thanks for the color, Eric. I had another one for the CTLA-4 study. Just curious, do you guys still plan to enroll more patients for the monotherapy at the 700 mg dose level or that's pretty much the 19th? I guess the 19th patient is every patient you plan for the monotherapy study.

I'm

happy to take that. We do not plan to further characterize monotherapy safety. I want to emphasize that the phase two monotherapy approach was a way to very efficiently and rapidly confirm our hypothesis that we were seeing a lower rate of immune-related adverse events compared with marketed CTLA-4 antibodies. We believe that we are indeed seeing a substantially lower rate of mediated adverse events. Our focus is now combining with PD-1 antibody approaches and further evaluating drug activity and safety in newly diagnosed metastatic or unresectable melanoma, as well as patients with lung cancer with specified mutations.

Gotcha. Thanks for the question. Thank you.

As a reminder, if you'd like to ask a question today, please press star 1. I'm showing no further questions at this time. I will now turn the program back

over to Jay Short for closing remarks.

Thanks everyone for attending today and we look forward to seeing everyone at ESMO September, as well as in our additional conferences coming up in the near future. Thank you and we'll also intend to report out on our business developments as they occur. Thank you.

This does conclude today's program. Thank you for your participation. You may disconnect at any time.