Compugen Ltd.

Ladies and gentlemen, thank you for joining us today. Welcome to Compugen's second quarter 2021 results 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, www.cgen.com. As a reminder, today's call is being recorded. I would now like to introduce Yvonne Naughton, Head of Investor Relations and Corporate Communications.

Thank you, Operator, and thank you for joining us on the call today. Joining me to present prepared remarks are Anat Cohen-Dayag, President and CEO, and Ari Krashen, CFO and COO. For the Q&A session, we will also be joined by Henry Adewoy, CMO, and Eran Ophir, Vice President, Research and Drug Discovery. Before we begin, I would like to remind you that during this call, the company may make projections or forward-looking statements regarding future events or business outlooks, our development efforts and their outcomes, our discovery platforms, Anticipated progress, results and timelines for our programmes, financial and accounting related matters, as well as statements regarding our cash position. Such statements represent only the company's current beliefs, expectations and assumptions, while actual results, performance or achievements of the company may differ materially. These statements involve known and unknown risks and uncertainties, and we refer you to our SEC filings for more details on these risks. including the company's most recent 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. With that, I will turn the call over to Anat.

Thank you, Yvonne. Good morning and good afternoon, everyone, and welcome to our second quarter 2021 update. Our continued progress through 2021 has been strong with steady execution solidifying our leading position in the denim axis and differentiating us in the TIGIT space as the only company targeting in a clinical setting PVRIG, TIGIT, and PD-1 as part of our free pathway hypothesis. On today's call, I'm pleased to have the opportunity to remind you of our strategy provide perspectives on our most recent data, our views on important developments in the field, and what's to come for the remainder of 2021. We believe that the foundation that underlies our success at CompuGen is our science and our people. We were the first to identify PVRIGN ILDR2 as novel checkpoints, and we published on TIGIT the same year as Genentech. Both PVRIG and TIGIT are key parallel and complementary inhibitory pathways in the denim axis which also intersect with the well-established PD-1 pathway. While TIGIT and PVRIG pathways share similarities, we observed key differences between the two with respect to their expression pattern and their ligand expression pattern on immune cells and tumor types. Furthermore, Our recent data shows that PVRIG is expressed similarly to PD-1 and TIGIT in stem cell-like memory and exhausted T cells, an important cell population with a potential role in mediating anti-tumor effects. However, recently, Eran Ophir, our VP of Research and Drug Discovery, presented scientific data showing that PVRIG has a more dominant expression pattern on early differentiated stem-like memory T cells than TGIT and PD-1, further pointing to the possibility that PVRIG may act differently. We believe that the future of immuno-oncology will be driven by combination approaches. Research from Compugen suggests that the PVRIG, TGIT, and PD-1 pathways have different dominance in different tumor types and patients, implying that to induce effective immune antitumor responses, certain patient populations may require the blockade of different combinations of these three pathways. To test this hypothesis, Compugen has established a biomarker and biology-informed clinical program which aims to evaluate different combinations of these axis members across tumor types. We're focused on maintaining our first mover advantage in the clinic as the only company with monotherapy, doublet and triplet combination clinical studies evaluating the Dynamexis players PVRIG and TIGIT as well as PD-1. We believe these programs, encored by our first-in-class anti-PVRIG antibody COM701, uniquely position Compugen with innovative and potential first-to-market doublet and triplet therapies. Our most recent data from the Phase I dose escalation and expansion cohort of COM701 as monotherapy and in combination with nivolumab presented at ASCO this year are important for several reasons. These preliminary data show durable responses and disease control in patients who exhausted all prior treatment options which may have meaningful effect. Notably, these responses were in tumor types typically not responding to immune checkpoint inhibitors. COM701 in combination with nivolumab resulted in a disease control rate of 67%. This included a complete response in a patient with anal squamous cell carcinoma who had prior treatment with nivolumab and the partial response in a patient with microsatellite stable colorectal cancer. These are tumor types typically unlikely to respond to checkpoint inhibitors and at the time of reporting we saw responses up to and beyond one year. Moreover, Our potential differentiation comes through the addition of an anti-TGIT antibody to this doublet regimen in our ongoing triplet combination study and combining anti-PVRIG with anti-TGIT in our newly initiated anti-PD-1 independent study. These data are also important as they demonstrate signals of antitumor activity in a COM701 monotherapy setting in patients who have exhausted all available standard therapies and in tumor types typically not responding to immune checkpoint inhibitors. COM701 resulted in a disease control rate of 47% including one partial response. It is also important to note that COM701 was well tolerated with no DLTs with monotherapy or in combination with nivolumab. This is a critical component of our ability to move forward with our differentiated combination approach. These preliminary data are also important as they included our first initial pharmacodynamic biomarker data which indicated treatment with COM701 leads to immune activation. We also showed that antitumor activity was observed in selected PD-1 low PVRL2 positive patients suggesting COM7-1 treatment may drive antitumor immunity even in patients with less inflamed tumor microenvironment. I will come back to this data and a broader biomarker strategy later in the call. Competent execution in the clinic has been impressive. In a short time, We have gone from our first clinical launch and data presentation to a comprehensive clinical program with the opportunity to truly differentiate us in the DNAM and TIGIT space, including the ongoing cohort expansion of COM701 in combination with nivolumab, the triplet study of COM701 with nivolumab and Bristol-Myers Squibb's TIGIT inhibitor, for which we just announced initiation of the cohort expansion study, the dose escalation of COM902, our wholly owned TGT inhibitor, and the recently initiated doublet study of COM902 and COM701, initially evaluating the safety and tolerability of the combination at both of the recommended doses for expansion in patients who have exhausted all available standard of care therapies, i.e. all comers. Once this is completed, an expansion cohort of both study drugs will be initiated in patients with PD-1 refractory or relapsed non-small cell cancer and head and neck swam of cell carcinoma, as well as colorectal cancer, microsatellite colorectal cancer. Having completed the dose escalation of the triplet study and initiated the triplet cohort expansion study, we continue to evaluate strategies to maintain our fast execution and first mover advantage. We are considering removing randomization from the ovarian arm of the triplet study as historical data for nivolumab in ovarian cancer already exist. and we know these patients have low response rate to nivolumab. In addition, we are considering adding an inflamed indication, possibly had a neck cancer, to broadly assess the full blockade of this axis in a tumor type that, unlike most of the other tumor types we evaluate, has an inflamed histology but still presents a low response rate to immunotherapies. And finally, our plan for the triplet includes starting the basket study when we have additional data aiming to support the link between PVRL2 expression and treatment response. Coming back to our biomarker strategy, on which we received a lot of questions, I thought I would take this opportunity to summarize our approach. We used biomarkers to select the tumor types for inclusion in our cohort of expansion studies. This was driven by our computational discovery prediction and validated in the lab on denim axis members' expression in tumor samples along with our initial clinical results from the dose escalation studies of COM701. Our focus in the various expansion cohort studies we initiated is on tumor types with a high level of both PVRIG and PVRL2 and the tumor types in which we saw initial signals of anti-tumor activity in the dose escalation studies. Such anti-tumor activity further supports our biomarker-informed approach and predictive discovery capabilities. The second part of our biomarker strategy is the identification of biomarkers for future patient selection. To achieve this goal, we are currently evaluating the correlation between the expression of the PVRIG pathway with clinical response as well as other exploratory biomarker identification approaches. This work is being done in our ongoing cohort expansion studies in which two more biopsies are collected pre and on treatment. And thirdly, We have a pharmacodynamic biomarker approach where we measure immune modulation induced by COM701 and combinations in peripheral and tumor patient samples obtained before and during treatment as mentioned earlier. Our first presentation of our preliminary biomarker results at ASCO provided initial clinical evidence for the potential immune-mediated mechanism of action with COM701. After one treatment cycle, patients with COM71 monotherapy showed the trend of increased proliferation of effector memory CD8 plus T cells. This is an important cell population, particularly given its high expression of PVRIG and role in driving antitumor activity. In addition, we saw a significant proliferation of NKT cells, which also plays a role in antitumor activity. From a cytokine perspective, levels of interferon gamma, a cytokine that plays a key role in antitumor activity, were upregulated following combination treatment of COM701 plus nivolumab. Interestingly, these results showed a dose-response trend with increasing doses of COM701 and fixed doses of nivolumab, suggesting that the observed increase in cytokines is derived from the combination regimen and not nivolumab alone. We were excited to present a case study at ASCO, which included archival biopsy data from a patient with platinum-resistant MSS primary peritoneal cancer. This patient with a confirmed PR who was on treatment for 18 months was PD-L1 negative prior to treatment with PVRL2 expression on both tumor and endothelial cells and an immune desert phenotype. Peripheral blood assessment in this patient showed immune activation as measured by immune cell proliferation and interferon gamma induction prior to tumor shrinkage. This biopsy and peripheral blood biomarker case study together with our recent finding of PVRIG expression profile on stem cell-like memory T cells and its ligand on dendritic cells suggest a potential mechanism of action of COM701 in driving tumor shrinkage likely through Immune Activation in a Patient with an Immune Desert Non-Inflamed Tumor Microenvironment These immune desert non-inflamed patients are those who are typically considered least likely to respond to checkpoint inhibitors and were encouraged by these initial results which provide the first translational indication that targeting the denim axis may expand the reach of immunotherapy to patients who typically do not benefit from these treatments. Our steady execution over the past year has propelled us to a unique first mover advantage as the only company with wholly owned clinical stage assets for both PVRIG and TIGIT. Recent developments in the field are providing important validation of our three-way hypothesis with considerable interest growing in pursuing similar approaches in evaluating the dual and triple blockade of Dynamexis members PVRIG and TIGIT along with PD-1. We believe the growing interest in the field endorses our overall strategy from target discovery and validation through to our clinical strategy and while others are looking to advance candidates targeting PVRIG into clinical studies, we remain ahead with clinical evaluation of monotherapy, dual and triple combination regimens already in progress with COM701. Part of the growing interest in the DENAM axis includes a debate regarding the role of the FC domain and its relevance for antitumor activity for immune checkpoint inhibitors in general and TIGIT antibodies specifically. And while the debate for TIGIT antibodies is ongoing, which was a point of discussion at the recent CITSE symposium on TIGIT, the consensus is that it is unclear if preclinical results from mice or in vitro studies support FC-active TIGIT antibodies will translate to the clinic. COM701 and COM902 were both purposely designed by Compugen to have reduced FC-effector function, as we believe this best positions us for success in the clinic. Antibodies with FC-effector function carry the risk of depleting CD8-plastesis, which are crucial for driving antitumor activity in the solid tumor setting. Our strategy is to avoid the risk of depleting this important cell population and our growing data support this decision with preliminary activity in the clinic with COM701. In addition, the recent developments in the field indicating promising Phase II randomized descriptive data with an FC silent anti-tigit are in line with our FC reduced function approach. So far, 2021 has been a year of execution for Compugen and we plan to continue this execution through the second half of the year with several milestones still expected to come. Among these milestones will be preliminary data from our leading phase 1, 2, triple combination study evaluating the safety, tolerability, and preliminary antitumor activity of COM701 in combination with Bristol-Myers Squibb TIGIT antibody and Evolumab. We remain on track to report initial data from the study in the fourth quarter of the year, which tests our triple blockade hypothesis that blocking the three intersecting PVRIG TIGIT and PD-1 pathways has the potential to synergistically enhance antitumor immune responses in selected patient populations not responsive or refractory to PD-1 blockade. This is a key differentiator for COMPIGEN in the competitive digit space. Our progress with the triple combination study continues with the recently announced initiation of the expansion cohort of the study. Moving next to COM902. The COM902 monotherapy dose escalation study is important as it enables us to select a dose to independently evaluate multiple combination approaches with COM902 in the clinic. We expect to provide initial data from the COM902 dose escalation in the fourth quarter of this year. We also strengthened our track record of executing in the clinic with the on-schedule initiation of our clinical study of COM902 in combination with COM701. This study, as the first clinical evaluation of the dual blockade of PVRIG and TIGIT, is again a key differentiator for Compugen in the competitive digit space. As you know, we also have an ongoing collaboration with Bayer and we are pleased with their commitment in advancing our ILDR2 program. Like PVRIG, ILDR2 was first discovered by Compugen. Bayer have full responsibility for development of Bapotilumab, which is a novel first-in-class Antialdia-2 monoclonal antibody. We're pleased to be able to say that enrollment is accelerating in the Phase 1 cohort expansion study, which is focused on treating patients with first-line IO-naive head and neck squamous cell carcinoma. We look forward to sharing additional updates on the progress of this collaboration in the future, subject to Bayer's communication policy. We are proud of our remarkable progress, excited for what's to come, and remain committed to pioneering the science and clinical studies that have the potential to expand the reach of immunotherapies to patient populations who are unresponsive or refractory to current treatments. Before turning the call over to Ari, I would like to thank the team at Compugen, our partners Investigators, Shareholders and Patients. I am incredibly proud of their ongoing commitment and dedication which has enabled our impressive execution. And with that, I will turn the call over to Ari to review the financials.