Compugen Ltd.

Ladies and gentlemen, thank you for joining us today. Welcome to Compugen's first quarter 2021 result conference call. At this time, all participants are in a listen-only mode. An audio webcast of this call is available in the investor section of Compugen's website at www.cgen.com. As a reminder, today's call is being recorded. With us from Compugen are Dr. Anat Cohen-Dayag, Ari Krashen, CFO and COO, and Dr. Henry Attaway, Chief Medical Officer, who will be available for questions at the end of the call. Before we begin, I would like to read the following regarding forward-looking statements. During the course of this conference call, the company may make projections or other forward-looking statements regarding future events or future business outlook, our development efforts and their outcome, our discovery platform, anticipated progress, and Timeline for our programs, financial and accounting related matters as well as statements regarding our cash position. We wish to caution you that such statements reflect only on the company's current expectations and that actual events or results may differ materially. You are kindly referred to the risk factors and cautionary language contained in the documents the company filed with the Securities and Exchange Commission, including the company's most recent annual report on Form 20-F, filed on February 25th, 2021. The company undertakes no obligation to update projections or forward-looking statements in the future. I would now turn over the call to Anat. Anat?

Thank you, operator. Good morning and good afternoon, everyone, and welcome to our first quarter 2021 corporate and financial update. We have started 2021 from a strong position building on our timely execution for our 2020 guidance and plans. We believe 2021 is supposed to be an important year for Compugen as we continue our efforts to build a robust clinical pipeline with multiple clinical studies while further deepen the scientific foundation for our differentiated programs. We have developed a comprehensive clinical development program designed to systematically elucidate the role of our internally discovered and wholly owned anti-PVRIG and TGIT assets across settings and combination regimens. With steady execution, we have made great progress both clinically and research-wise in understanding the role of the DYNAM-AXIS members, PVRIG and TIGIT, as potentially foundational immunotherapy checkpoint targets. Our work has identified PVRIG and TIGIT as key parallel and complementary inhibitory pathways in the DYNAM-AXIS, which also intersects with the well-established PD-1 pathway. Together, our data suggest that these three inhibitory pathways have different dominance in different tumor types and patients, which means that in order to induce effective anti-tumor responses, certain patient populations may require the blockade of different combinations of these three pathways. With this in mind, we have established a science-driven and data-informed and the clinical program, which evaluates different combinations of these axis members across indications that we believe will be most relevant in the clinic. On our last call, we shared data from the combination arm of the Phase I dose escalation study of COM701 in combination with Bristol-Mell-Scripps nivolumab, as well as follow-up data from our monotherapy dose escalation and cohort expansion study. For the combination arm dose escalation, we provided complete data from all five dose levels in the study. Our encouraging results showed a disease control rate of approximately 67%, which is a significant accomplishment given the highly refractory, heavily pretreated, and Advanced Disease Patient Population. Equally important are the observed durable responses in multiple patients and across indications which include patients with complete and partial responses with patients on study treatment for almost a year or in some cases for more than a year. An additional meaningful highlight from these updated data relates to the patient with a complete response who prior to being enrolled in our study had disease progression on a checkpoint inhibitor. This data suggests the dual blockade of PDR-IG and PD-1 may be key to driving antithrombin immune responses in certain patient populations. These readouts are particularly significant Given our latest announcement of our expanded clinical collaboration with Bristol-Mers Squibb to initiate a Phase 1b dual combination expansive study of COM701 in combination with nivolumab, which is expected to begin in the second quarter of 2021. This study will enroll patients with ovarian, breast, endometrial, and microsatellite-stable colorectal cancer and is an important addition to our clinical strategy expanding the potential reach of this combination regimen while also providing insight towards the contribution of the different components of the denim axis across our ongoing and future COM701 studies and specifically our ongoing triplet study We also shared initial data from our COM701 monotherapy cohort expansion, a safety and tolerability study with a biomarker-informed strategy to select tumor types most likely to respond to treatment based on preclinical expression data and clinical results from the dose escalation arm. These indications are endometrial, breast, ovarian, colorectal, and non-small cell and cancer. Enrollment of 20 patients in the study was completed in the fourth quarter of 2022. As of the data cutoff date we presented last quarter, six out of 20 patients had the best response of stable disease across endometrial, non-small cell lung, and ovarian cancer, and two patients with durable antitumor activity continuing on treatment. These data, combined with our COM701 dose escalation data, provide signals of antitumor activity in a monotherapy setting in tumor types typically unresponsive to immune checkpoint inhibitors. In addition, some of these single agent signals are durable, including a patient with a confirmed partial response from the dose escalation study on treatment for over one year as of the data cutoff date presented last quarter. It should be noted that these were highly refractory patients who exhausted all treatment options with tumor types that are typically non-responsive to checkpoint inhibitors, including patients with prior progression on these treatments, which together suggest that PVRIG blockade may be an important untapped checkpoint that has the potential of driving anti-tumor immune responses. The clinical data across the combination and monotherapy arms leaves us increasingly confident in our prediction that there are certain patient populations which are likely to respond to PVRIG blockers and or PVRIG and PD-1 dual blockade, including those that have progressed on immune checkpoint blockers. Another angle to evaluate the activity of CON701 is the data analysis in progress from the COM701 Monotherapy Cohort Expansion Study that will include correlative assessments based on data from patient samples including cytokines, immune phenotyping, and immunohistochemistry analysis. This data that will also be gathered from our dual and triple combination studies will enable us to gain insights relating to COM701 and PVRIG-PVRL2 pathway biology, particularly in indications that are typically not responsive to PD-1 blockade. Our initial assessments of patients' peripheral blood samples suggest that COM701 may enhance immune activation in cancer patients alone or in combination with nivolumab. These results provide for the first time an indication for the potential effect of PVRIG blockade in peripheral blood of cancer patients treated with COM701. We are excited to be providing updated data from the COM701 monotherapy and combination with nivolumab studies in our upcoming oral presentation at ASCO on June 7, 2021, and look forward to sharing the data following our oral presentation. We continue to invest in our clinical programs and have expanded our clinical strategy to include multiple clinical studies in order to maintain our leadership position in the evaluation of the DYNAM-AXIS pathway. Moving forward in 2021, we expect to continue to execute across our broad clinical strategy, which includes the ongoing triplet study of COM701 with nivolumab and Bristol-Merce-Quiggs TG inhibitor, the initiation of the doublet expansion study of COM701 with nivolumab In the second quarter of 2021, the ongoing dose escalation of COM902, our wholly owned TGT inhibitor, and following the completion of the COM902 dose escalation, the initiation of the doublet study of COM701 and COM902 in the second half of this year. With these studies in place, We are positioned to rapidly generate multiple data readouts that will be key for our development of denim axis-based new cancer immunotherapies. Our Phase 1-2 triple combination study evaluating the safety, tolerability, and preliminary anti-tumor activity of COM701 in combination with Bristol-Mers-Quibb's TGIT antibody and Nivolumab is currently enrolling patients and we expect to share initial data from the dose escalation portion of the study in the fourth quarter of this year. The purpose of this study is to allow the testing of our triple blockade hypothesis that blocking the three intersecting PVRIG, TGIT and PD-1 pathways has the potential to synergistically enhance Antitumor immune responses in selected patient populations not responsive or refractory to PD-1 blockers. Another ongoing trial, the COM902 monotherapy dose escalation study, is an important component of COMPIGEN's overall strategy. We have seen the growing interest in TIDIT inhibitors, which now include multiple clinical stage programs, and we're closely following the developments in this space. We firmly believe it is important to pursue the development of our own candidate to maintain our control of what we believe are two key arms of the denim axis and our ability to independently evaluate multiple combination approaches which includes tidbits in the clinic. Advancing COM902 through dose escalation and future combination studies is important for our position in the PVRIG digit space. We expect to provide initial data from the COM902 dose escalation study in the fourth quarter of this year and are on track to begin studies evaluating COM701 in combination with COM902 in the second half of this year. The preclinical data we published in Cancer Immunology and Immunotherapy strengthen our confidence in our clinical approach, providing important information on the underlying biology of STIGIT and its potential synergies with other immune checkpoints which we can leverage in our clinical strategy. This data together with our internal PVRLG research allows us to focus and refine the indications we will pursue in the clinic to potentially maximize the probability of success of our combination strategy of COM701 and COM902. In addition, our research further demonstrates the absence of T cell depletion activity in vitro and in vivo with COM902, and therefore reinforces our COM902 approach, which was designed to have reduced ST receptor engagement to avoid potential depletion of TGIT-expressing effector T cells. As you can see from our various scientific publications, we continue to invest in high-quality in-house research that feeds our clinical pipeline strategy in order to keep it differentiated and competitive. Our progress from target discovery, validation, and preclinical development now through to a comprehensive clinical program has been remarkable. Our discovery of the previously unknown PGRG pathway uncovered this immuno-oncology pathway, and our research and clinical work have supported our position as leaders in the Dynam-Axis space, which has been highlighted by our status as the only company with wholly owned clinical stage assets targeting both PDR-IG and TISID. And thus, the only company currently capable of evaluating in the clinic PDR-IG monotherapy, Dual blockade of PVRIG with PD-1 or TIGIT and triple blockade of PVRIG with PD-1 and TIGIT. We're highly enthusiastic about what's to come later in the year. Most importantly, initial data from our dose escalation triple combination study. Our phase 1-2 triple combination study designed as a study in ovarian and endometrial cancers and additional tumor types with high PVRL2 expression is the ultimate test of our hypothesis and a true differentiator in the crowded immune oncology space. Beyond this exciting clinical progress, we're also continually driving forward our science which has been the foundation that underlies our clinical progress. Our recent publications in cancer immunology immunotherapy and cancer discovery are testament to our scientific rigor and broader contributions to the fundamental biology of the genome axis. We will continue our efforts to drive the science forward Building upon our deep scientific heritage that we believe plays an integral role in our potential success. A key factor in driving our science forward involves the advancement of our early stage pipeline with multiple programs targeting the immunosuppressive tumor microenvironment, including targeting the myeloid population The expansion of our fruitful research collaboration with Johns Hopkins University to include focused research on a competent discovered novel myeloid target reinforces our ability to further discover completely new drug targets and our continued focused research and development on early stage programs. along our clinical development execution. We are proud to continue this long-standing collaboration addressing our multiple drug candidates with Dr. Drupal Doll who played an important role in the preclinical development of COM701 and look forward to collaborating with his incredible team to advance a novel immune oncology agent that has the potential to target tumor-associated macrophages in the tumor microenvironment. We're excited by this novel myeloid target, and although this is very early days, we hope that through rigorous and deep research, we will build a strong foundation that can ultimately translate this very early-stage program to a first-in-class clinical candidate. And while our progress Thank you very much. and our future strategic path. Investing in our early stage programs and pipeline growth engine remains high priority for Compugen and we believe in the potential of our platform to uncover additional, untapped, novel immuno-oncology targets just as we did with Adenam Axis. Finally, before turning the call over to Ari, I would like to thank the team at Compugen, our partners, investigators, shareholders, and patients. The dedication and contributions across these groups are what have enabled us to continue our on-track execution and progress despite the still ongoing COVID-19 pandemic. We are proud to have our prior guidance for enrollment and data Thank you, Anat.

Good morning and good afternoon to everyone. Our financial results for the first quarter of 2021, released this morning, continue to reflect a solid financial position with, as expected, increased research and development expenses, due to our growing number of clinical trials. Research and development expenses for the first quarter of 2021 were $7.3 million, compared with $4.7 million for the same period in 2020. This increase is attributed mostly to CMC-related activities, specifically manufacturing costs for additional drug supply of COM701 to support the planned expansion of our various clinical trials as well as expanded clinical team located in the US which brings additional expertise to the company to ensure the successful management and execution of our ongoing and soon to be initiated clinical trials. As a reminder, our clinical expenses reflect costs associated with our expanded clinical programs which will now include COM701 in monotherapy, dual and triple combination studies, as well as load escalation study for COM902. Net loss for the first quarter of 2021 was $9.9 million or 12 cents per basic and diluted share compared with a net loss of $7.1 million or 10 cents per basic and diluted share for the same period in 2020. As of March 31st, 2021, we had approximately $190 million in cash and cash-related accounts The company has no debt. The decrease in our cash balances of approximately $5 million net during the first quarter represent approximately $9 million of gross cash expenditures offset by a collection of $2 million from AstraZeneca related to the revenues recognized in the fourth quarter of last year, and two million dollars of working capital. As a reminder, we expect our gross cash expenditures for 2021 to be in the range between 40 to 42 million dollars without taking into consideration any potential cash inflows for the company from existing or new collaborations. Thank you. And with that, we will now open the call for questions.