Compugen Ltd.

Ladies and gentlemen, thank you for joining us today. Welcome to CompuGen's second quarter 2022 results conference call. At this time, all participants are in a listen-only mode. An audio webcast of this call is available in the investors 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. Yvonne, please go ahead.

Thank you, Yoni, and thank you all for joining us on the call today. Joining me to present prepared remarks are Dr. Anak Cohen-Dyag, President and Chief Executive Officer, and Ari Krashen, Chief Financial and Operating Officer. For the Q&A session, we will also be joined by Dr. Henry Adewoye, Chief Medical Officer, and Dr. Eran Ofer, Senior Vice President, Research and Drug Discovery. Before we begin, we would like to remind you that during this call, the company may make projections or forward-looking statements regarding future events, business outlook, development efforts and their potential outcome, the company's discovery platform, anticipated progress, results and timelines 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 the company's current beliefs, expectations and assumptions. but actual results, performance, or achievements of the company may differ materially. These statements are subject to known and unknown risks and uncertainties, and we refer you to the SEC filing for more details on these risks, including the company's most recent annual report on Form 20F, filed with the SEC on February 28, 2022. The company undertakes no obligation to update projections and forward-looking statements in the future. With this, I now turn the call over to Anat.

Thank you, Yvonne. Good morning and good afternoon, everyone, and welcome to our second quarter 2022 update. Today's call will focus on the strategic decision we have taken to move the company forward with an anticipated extended cash runway through the end of 2024. I'm happy to say that we continue to execute on all fronts and have made significant progress. We now have sufficient insights to focus on two prioritized indications and wind down the existing cohort expansion studies in our current phase one program. Our focus development plan results in the strategic decision to wind down these studies, resulting in the conclusion of our collaboration with Bristol-Mass Squibb. I would like to thank them for our productive interactions and for supplying nivolumab and their anti-tigit antibody for our Phase I program, enabling us to initiate the triple and dual combination studies to evaluate our denim axis hypothesis at a time when our own differentiated anti-tigit Com902 had not yet reached the clinic. I would also like to thank all the investigators, site staff, and patients who participated in our studies to date. I believe... that our strategic decision to move forward and prioritize two indications while ending the current Phase I studies is the right thing to do at this time. We at Compugen believe that it is the optimal path forward for our company. We believe that this decision will enable faster value creation for our stakeholders and reflect better use of our current resources for the benefit of patients for the following reasons. First, it gives us flexibility and allows us to be nimble and move quickly and efficiently to focus on two prioritized indications that we believe offer the highest probability of success and may support a future path to registration. Second, under these market conditions, It reduces the risk posed by a further broad assessment of three large parallel studies in hard-to-treat immune checkpoint inhibitor insensitive indications and with patients who exhausted all treatment options. Third, it extends our cash runway through the end of 2024. Fourth, it enables us to leverage the combination of our own in-house clinical stage potentially first-in-class anti-PVRIG antibody COM701, and switch to and develop our differentiated anti-tigit antibody COM902. And finally, it gives us flexibility and provides us with the greatest opportunity to advance and partner our clinical assets and support a future path to registration. I'm excited about what we have achieved what we can achieve, and I look forward to focusing on execution and delivering value. During today's call, I will reiterate the belief we have in our already stated differentiated clinical strategy, provide the rationale behind our strategic decision to conclude our current phase one program early, our choice of prioritized indications and path forward, I will also briefly touch on advancement in our preclinical pipeline. Ari will then review second quarter financials, and I will close with a few remarks. Starting with our differentiated clinical strategy, Compugen has done groundbreaking work to identify and develop two proprietary novel immune checkpoint inhibitors that have the potential to be first-in-class and best-in-class. COM701, an anti-PVRIG monoclonal antibody, and COM902, an anti-tigit monoclonal antibody. As a company with vast experience in these pathways, our narrative remains the same. We have a differentiated clinical strategy in uncharted territory supported by strong science. CompuGen is the only company studying the triple blockade of the Dynamaxis targeting PVRIG, TIGIT, and PD-1 in the clinic. We're leading the way and others are following. We recognize targeting TIGIT is a competitive space with the most advanced programs already being evaluated by pharma in phase three studies. This is testament to the promise of modulating this pathway to enhance anti-tumor immune responses. Importantly, we believe that not all TGs are the same. We were the first company to present clinical data with an IgG4 anti-TG antibody with low FC effect or function, and we have good reason to believe this is the right design to pursue. And in contrast to others, we have shown clinically that COM902 avoids depletion of CD8 plus T cells, the cells important for antitumor activity. We believe the IDG4 backbone may come with additional efficacy and safety benefits to be confirmed in the clinic. We have also stated that blocking only part of this axis may not be enough. Based on our groundbreaking science, demonstrating unique biology for PVRIG versus other checkpoint inhibitors and the early clinical and translational data we have presented to date, we believe targeting PVRIG may be the missing piece by creating a more inflamed environment. In our COM701 monotherapy in combination with nivolumab studies presented at ASCO in 2021, we showed partial responses or stable durable disease in patients with low expression of PD-L1 with tumors that are less inflamed and generally less responsive to approved checkpoint inhibitors. In addition, we showed that triple combination treatment was associated with potent immune activation greater than what was seen with mono or dual therapy. moving to our strategic decision to advance two prioritized indications and end our Phase I cohort expansion studies. Our Phase I cohort expansion program was designed to allow us to systematically evaluate our hypothesis that simultaneously blocking three pathways, PDR-IG, TIGIT, and PD-1 in selected tumor types could extend the reach of cancer immunotherapy. We also included studies testing subsets of these three pathways by blocking only two pathways and pursued these studies in overlapping indications with an intention to learn as much as possible on the dominance of the various pathways and the contribution of components in the hardest to treat tumor types. In selected tumor types, we identified initial signals of anti-tumor activity and insights into the contribution of components in overlapping indications. In cases where part of the translational work has been performed, we're able to detect immune activation suggesting a COM701-mediated mechanism of action. We believe the initial signals of antitumor activity that we're seeing with COM701 coupled with changes occurring in the tumor microenvironment in some of the hard-to-treat checkpoint nonresponsive indications, support further evaluation with COM701. To this end, we have decided to move on independently and with more flexibility with two prioritized indications, which we believe offer a higher probability of success and may support a future path to registration. One in a less inflamed tumor, microsatellite-stable colorectal cancer, with a low bar to beat compared to standard of care, but a tumor type that reflects a higher risk as it has so far been immunologically unresponsive. The second is an inflamed tumor, non-small cell cancer in anti-PD-1 treated patients. This tumor type is more immunologically responsive and therefore may present a more permissive environment for denim axis activity, although the patient population is challenging to treat. Going back to microsatellite-stable colorectal cancer, there is no approved therapy specifically for this patient, and immune checkpoint inhibitors have demonstrated limited or no activity in this patient population. Treatment in a third line or greater setting is typically Regorafenib or Lonserve, which show overall response rate of 1%, median progression-free survival of two months, and median overall survival of six to seven months. Also note, Pembrolizumab monotherapy has shown 0% response in this population improving only to an overall response rate of 6% in combination with anti-LAG3. As of today, we have presented data in third-line or greater settings from 12 patients using various doses of COM701 with or without nivolumab across studies, and we have shown encouraging preliminary antitumor activity with an overall response rate of 8%, including one partial response of 44 weeks. Our clinical data from the COM-701 Evolumab dose escalation and cohort expansion study in a small number of MSS-CRC patients show a modestly higher response rate compared to what has been reported for standard of care. We believe that this initial data, along with the translational package showing COM-701-driven mechanisms in MSS-CRC patients, warrants further evaluation of COM71 triple combinations in the single-arm study. Next, non-small cell and cancer, an indication we selected as high priority due to clinical landscape and regulatory considerations. As an inflamed tumor type sensitive to PD-1 and possibly TG checkpoints, non-small cell and cancer may have an increased probability of responding to our triplet combination. We specifically plan to focus on post-NTPD1 non-small cell and cancer patients as it describes a high unmet need and the patient population where positive data may allow us to more easily exemplify the uniqueness of our drugs in a single-arm triple combination study as opposed to a first-line patient population study where the response rate and duration of response are already high with other checkpoint inhibitors. In addition, a first-line setting presents significant hurdles in patient enrollment due to competitive reasons and therefore may present a risk in delay to reach to data readout milestones. In parallel to this triplet checkpoint study, We also plan to separately evaluate the blockade of PD-RIG and TIGIT in combination with standard of care in this patient population. This will allow us to build an additional path to randomized studies and generate insights regarding the Dynamaxis activity in the presence of chemotherapy. As previously communicated, we plan to share the microsatellite-stable colorectal cancer data from the COM701 EVOLUMAB cohort in Q4 of this year. Given our strategic decision to end the cohort expansion studies early, a year and a half prior to projection completion of enrollment, and focus our efforts on the prioritized indications, we do not currently plan to present data from the other cohorts. Our focus will be on effective execution of our studies for these prioritized indications, continuing our track record in execution. We plan to expand the protocol of the existing COM701 plus COM902 study and conduct the three single-arm studies. Each will consist of up to 20 patients with an aim to enrich for patients who are most likely to respond. Based on the data we have, what has been reported by others, and discussions with key experts in these indications. The details of the design and the timelines will be shared once finalized in the fourth quarter of this year. We plan to share initial findings and progress of these studies during 2023. Moving on to our core research programs, competent scientists are pioneers. We continue to do groundbreaking work focusing on modulating the immune-suppressive cells in the tumor microenvironment. We are advancing several early-stage programs, all predicted by our computational discovery capabilities, with one program entering pre-IND enabling studies with first-in-class potential. We are very excited about this program, which is targeting a soluble immune checkpoint upregulated in the tumor microenvironment in response to interferon gamma. We developed a very high affinity antibody, COM503, to block this targeted soluble immune checkpoint pathway, and we believe we're the first to do so. We have demonstrated preclinical in vitro and in vivo activity as monotherapy and in combination across various models. We plan to share details on this program in the fourth quarter of this year. And finally, Compugen closed the quarter ended June 30 with $97 million in cash. This strong financial position should allow us to execute on our clinical plans and support our operations through the end of 2024. Before I pass over to Ari, I want to take a moment to thank the Compugen team for their dedication and commitment to the company goals in the second quarter of the year. I also would like to thank Ari, who has agreed to continue to support Compugen while we are in the process of identifying his successor.