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spk03: Good afternoon, everyone. Thank you for standing by. Welcome to the Cytomics Therapeutics First Quarter 2023 Financial Results Call. Please be advised that today's call is being recorded. I would now like to hand the call over to your host today, Chris Ogden, Cytomics Senior Vice President, Finance and Accounting. Please go ahead.
spk06: Thank you. Good afternoon, and thank you for joining us. Before we begin, I would like to remind everyone that during this call, we will be making forward-looking statements. Because forward-looking statements relate to the future, they are subject to inherent uncertainties and risks that are difficult to predict and many of which are outside of our control. Important risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov. We undertake no obligation to update any forward-looking statements, whether as a result of new information future developments, or otherwise. Earlier this afternoon, we issued a press release that includes a summary of our first quarter 2023 financial results and highlights recent progress at Cytomix. We encourage everyone to read today's press release and the associated materials, which have been filed with the SEC. Additionally, the press release, a recording of this call, and our SEC filings can be found under the Investors and News section of our website. With me on the call today is Dr. Sean McCarthy, Cytomix's Chief Executive Officer and Chairman. Sean will provide a business and pipeline update before I walk through the financials for the first quarter. With that, I'll now turn the call over to Sean.
spk01: Thanks, Chris. Good afternoon, everyone. Thanks for joining us for an update on recent progress at Cytomix. On today's call, I'll provide an update on the company's pipeline progress and the continued execution towards our key priorities for 2023 before opening up the call to Q&A. At Cytomix, we believe that as biologic anticancer therapies become more and more potent, the need for localizing empowered modalities such as antibody drug conjugates, T-cell engagers, and cytokines into cancer tissue becomes increasingly important as a way to improve therapeutic window. Indeed, we believe that localization will be the future of biologics. Cytomix's vision is to transform lives with safer, more effective therapies. We aim to realize our vision for the benefit of patients by leveraging our ProBody platform to create high-impact therapeutics that are localized to disease tissue, thereby reducing systemic toxicities and maximizing overall benefit. Our versatile platform for protease-based, conditionally-activated biologics has strategically positioned our company and pipeline at the intersection as some of the most promising areas of oncology research and development. And I'm excited to walk through the progress of the company during the first quarter of 2023. Throughout Q1, we continue to advance our diversified portfolio of innovative pro-body therapeutic candidates for the treatment of cancer while ensuring disciplined resource allocations. Psychonomics entered 2023 with robust financial resources, positioning the company to execute towards multiple milestones over the next 12 to 24 months. We remain intensely focused on executing towards these milestones, with CX904 continuing to progress in phase one, and IND enabling activities for CX2051 and CX801 remaining on track, with IND filings projected for Q4 this year. With more than 15 internal and partner programs, we are well positioned to deliver meaningful value to patients through the continued progression of our pipeline. Before moving to a review of our pipeline, I'd like to start by taking just a moment to congratulate Dr. Marcia Balvin on her promotion to Chief Scientific Officer of Cytomix, announced today. Marcia joined Cytomix in 2018 as Head of Oncology Research and has since played a vital role in the translation of key learnings from our first wave of clinical programs into the next generation pro-body candidates that make up our current pipeline. Marcia is a key driver of our research, drug discovery, and translational strategies, and has also been central to our continued business development success. My colleagues and I look forward to continuing to work closely with Marcia as we maintain our leadership position in biologics localization through conditional activations. Now moving to our pipeline, I'd like to start with our significant R&D activity in the area of T-cell engaging bispecifics. T-cell engagers hold enormous promise for the treatment of solid tumors. However, the very potency of this modality can lead to widespread activation of the immune system, imposing constraints on therapeutic window. Localization of the powerful anti-cancer activity of this class of drugs could unlock great potential for patients by enhancing therapeutic window, and we at Cytomics, with the support of our partners, believe that the ProBody platform could be ideally suited to addressing this challenge. Our lead program in this area is CX904, a clinical stage ProBody T-cell engager targeting EGFR and CD3, partnered with Amgen in a global co-development alliance. EGFR is a highly validated and broadly expressed cancer target, And we see a compelling opportunity to leverage EGFR target expression as an address to localize and harness anti-tumor T cell responses preferentially to the tumor microenvironment. Our previous work on EGFR published in Science Translational Medicine demonstrated that marking of the EGFR therapeutic antibody, cetuximab, substantially reduced side effects commonly associated with EGFR therapy. This work opened a window to explore empowered anti-EGFR strategies, and CX904 leverages this approach. We're making steady progress with CX904 in the clinic. We successfully treated our first patient in May 2022, and the dose escalation portion of the study continues to advance. We have completed the initial accelerated dose titration phase of the study, which allowed for single patient cohorts, and we're now enrolling into the 3 plus 3 phase. The primary goal of dose escalation is to assess safety and reach dose levels and exposures by the end of 2023, at which enrollment into backfill cohorts in certain EGFR-positive tumors can begin. In 2024, a key milestone will be the determination of our phase two dosing strategy and potential initiation of expansion cohorts. This decision will be taken in collaboration with our partner, Amgen. We look forward to providing additional CX904 updates later this year. Continuing our work in T-cell engagers, we were also delighted to share recently that our partner, Astellas, nominated the first clinical candidate under our collaboration, triggering a $5 million milestone payment to Cytomix. This program is advancing to IND-enabling activities at Astellas. Cytomix and Astellas are also collaborating on additional T-cell engager programs, And Cytomix is eligible to receive future preclinical, clinical, and commercial milestones across these programs, and also retains the option to certain U.S. development and commercial rights. We look forward to providing additional updates regarding the Astellas collaboration as these programs progress. We've also been busy recently kicking off our collaboration with Regeneron in bispecific immunotherapies. Regeneron, of course, brings tremendous scientific depth to our alliance, and we're excited to be combining our technologies with the goal to widen the therapeutic window for potentially paradigm shifting next generation immunotherapy. We look forward to continuing to make expeditious progress in this new alliance. Moving now to our upcoming INDs for the next generation molecules, CX2051 and CX801. These programs incorporate the continuing evolution and advancement of our science and platform building on our prior work in the clinic. Starting with CX2051, our wholly owned conditionally active pro-body ADC targeting epithelial cell adhesion molecule, or EPCAM, also known as TROP1. EPCAM has been regarded as a high potential target for decades and has been clinically validated by others in oncology. However, clinical activity has only been achieved with local administration, for example, in non-muscle-invasive bladder cancer. CX2051 is tailored to optimize the therapeutic window for EPCAM-expressing epithelial cancers by matching the target with payload mechanism of action and tumor sensitivity. We've optimized protease cleavability of the mask for this molecule and selected a camtothecin derivative as the payload for the program, a topoisomerase I inhibitor from the TCAN class. The TCAM payload class has shown exciting clinical results with ADCs, including NHER2 and Tredelvi, and we think this payload is an optimal choice for this program. In preclinical studies, CX2051, when systemically administered, has demonstrated a wide predicted therapeutic index and strong activity in multiple tumor xenograft models, including colorectal cancer. We anticipate filing an IND for this novel ADC in Q4 this year, and advancing the program into the clinic in 2024. Moving to CX801, our dually masked interferon alpha 2B, the lead program within our broad efforts in the cytokine field. We believe there's enormous potential to harness the powerful anti-cancer activity of cytokines by using our localization strategies to direct their activity towards tumor tissue and away from systemic immune system activation. Interferon-alpha 2B is an approved immunotherapeutic that has demonstrated clinical activity in multiple cancer types. Interferon-alpha stimulates antigen-presenting cells to activate cytotoxic T cells and may combine effectively with checkpoint inhibition, offering tremendous potential to enhance immunotherapy responses and unlock checkpoint refractory and or resistant cancers. Interferon-alpha also has direct tumor cell killing activity, providing a dual mechanism of action. However, the powerful anti-cancer activity of interferon alpha has thus far been difficult to harness due to its systemic toxicity. Preclinically, CX801 has demonstrated a wide therapeutic index with an enhanced tolerability profile compared to unmasked interferon, along with preferential activity in the tumor microenvironment. We believe CX801 has the potential to become a unique centerpiece of combination therapy for a wide range of tumor types, And we aim to rapidly advance this potentially best-in-class program towards clinical evaluation with an IND filing targeted for Q4 this year and clinical initiation in 2024. We'll be providing an update on our preclinical evaluation of CX801 at the International Cytokine and Interference Society Guest Symposium at AAI this weekend in Washington, D.C. during which we will also be introducing our exciting work on a new wholly-owned cytokine program focused on conditionally active localized versions of interleukin-15. Turning now to our partnership with BMS, in February of this year, BMS announced that they would be prioritizing and advancing from phase one to phase two the anti-CTLA-4 non-feucosylated probody, BMS-986288. BMS continues to enroll into the Phase 1-2 study, evaluating 288 as monotherapy and in combination with NEVO in solid tumors. And they recently opened a new study arm, evaluating the triplet of 288, NEVO, and regorafenib in third-line or later colorectal cancer. We continue to be excited to have the ProBody platform as a leading edge of their CTLA-4 strategy, as well as to continue to collaborate on several earlier stage ongoing research programs. Let me now turn briefly to our work on CD71, the transparent receptor. At Cytomics, we've had a longstanding interest in leveraging the unique molecular properties of CD71 as an anti-cancer target due to its rapid internalization rate and ability to transport ADCs and other therapeutic modalities into cells. Our CX2029 program, a pro-body ADC previously partnered with AbbVie, has shown encouraging clinical activity, including a 21% overall response rate in late-stage metastatic squamous esophageal cancer. Cytomics recently regained full rights to the CD71 target from AbbVie and has an exclusive option to reacquire the full rights to CX2029. We're assessing next steps for our CD71 program, including potential partnering and additional clinical studies for CX2029, and also next generation strategies for targeting CD71. We'll provide further updates in due course. Finally, I'd like to briefly discuss our partnership with Cytovix's newest partner, Moderna. As a core component of our business model, we've leveraged strategic partnerships to extend the reach of our science, broaden our pipeline, and bring important non-diluted capital into the company. This collaboration is yet another proof point of the validation of Cytomic's scientific expertise and platform breadth, which has now been extended to mRNA. Work is well underway with this important new partnership, which includes programs both in and outside of oncology. We look forward to making progress with Moderna in these novel areas of R&D. With that, let me turn the call over to Chris to cover the financials for the quarter. Thank you, Sean.
spk06: I'm pleased to be able to share an update on our first quarter 2023 financial results with you today. Having completed our restructuring in 2022 and initiated the new research collaborations with Regeneron and Moderna, Cytomix entered 2023 in a strong financial position with $204 million in cash, cash equivalents and investments as of March 31st, 2023. Based on our current expectations and corporate objectives, we expect our cash resources will fund company operations to mid-2025. Our cash runway expectations do not include potential milestone payments from existing collaborations or any new business development. The cash balance of $204 million as of March 31st compares to $194 million as of year end 2022. Cash received in the first quarter of 2023 included $35 million as a result of the upfront payment received from the Moderna collaboration and a $5 million clinical candidate milestone payment earned under the ASTELLAS agreement. These collaboration payments are examples that underscore our continued ability to access non-dilutive capital as well as earn ongoing cash flow through research funding and milestones. Now, let me spend a few minutes on cash for the quarter and our expectations moving forward. Normalizing for the Moderna and Astellas cash inflows in the quarter, cash burn was approximately $30 million for the first quarter of 2023, compared to approximately $42 million in the first quarter of 2022. The reduction in cash burn versus the first quarter of 2022 was primarily driven by the corporate restructuring as well as pipeline prioritization. As we execute towards our 2023 and long-term objectives, we continue to maintain focus on prudently managing costs, including the execution during Q1 of a sublease for a portion of our facilities that will reduce rent expense starting in the second quarter of 2023. Looking to the company's go-forward operational cash needs, we expect overall cash burn to continue to moderate down from 2022 and the first quarter of 2023 as we move through the balance of this year. Now, moving to revenue and operating expenses for the quarter. For the first quarter, revenue was $23.5 million compared to $9 million in 2022. The increase in revenue was driven primarily by higher percentage of completion for projects under the company's collaboration with Bristol-Myers Squibb, the milestone earned under the agreement with Astellas, and the completion of the company's obligations under the CD71 collaboration agreement with AbbVie. R&D expenses decreased by $9.4 million to $21.2 million in the first quarter of 2023, compared to $30.6 million for the corresponding period of 2022, primarily due to a decrease in personnel-related expenses as well as winding down activities related to the CX 2009 and CX 2029 programs. G&A expenses decreased by $2.6 million in the first quarter of 2023 to $8 million, compared to $10.5 million for the corresponding period in 2022, primarily due to a decrease in personnel-related expenses from the workforce reduction in 2022, as well as patent-related legal expenses. With that, I'll turn the call back to Sean.
spk01: Thanks, Chris. In closing, I would like to again emphasize the terrific execution by the Cytomix team so far this year. Our scientific depth in biologics localization through conditional activation positions the company at the forefront of potential breakthroughs with potent biologic modalities such as ADCs, T-cell engagers, and cytokines. True innovation takes time. Cytomic's current pipeline and financial strength has resulted from the continued execution of our long-term strategy in which we invest in big ideas and continuously learn from the translational cycle of bench to bedside to bench in order to deliver meaningful benefit for patients. We are intensely focused on driving towards key inflection points in our pipeline, with particular focus on our newest programs. We remain well on track with the CX904 Phase 1 study, and our IND enabling studies for CX2051 and CX801. Additionally, our scientific leadership has continued to attract valued new partners, allowing us to broaden our pipeline and maintain balance sheet strength. We look forward to continuing our work and to providing future updates. With that, operator, please open up the call for Q&A.
spk03: Thank you. As a reminder, to ask a question, press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from Mitchell Kapoor with HC Wainwright. Your line is open.
spk07: Hi, everyone. Thanks for taking the questions. Just wanted to ask on CX809, once the IND is filed, what can we kind of expect for trial design and strategy? Would we be able to see you look towards tumor types on the label of approved interferon alpha 2B, or is it too soon to say?
spk01: Yeah, hi, Mitch. Thanks for the question. It's a little too soon to say. I mean, as you rightly allude to, interferon alpha 2B has shown clinical activity in a variety of settings, including renal, melanoma, certain leukemias, like hairy cell leukemia, follicular lymphoma. And more recently, in fact, quite recently, the approval of the gene therapy targeting interferon alpha-2B and non-muscle invasive bladder cancer in the BTG non-responsive setting, where local administration clearly is highly active in that indication. So there are a number of places where we know Interferon Alpha is active, and we're currently evaluating the optimal strategy. One of the things that we're giving a lot of thought to is, of course, the long-term objective with this program, given the potency of Interferon Alpha, is to move into the area of cold tumors, you know, IO unresponsive tumors. But as a stepping stone, we'll likely be starting our work in tumor types where there's known to be more immune responsiveness, at least initially, teeing up potential combination strategies. So it'll be a stepwise approach, and we'll have more to say as we get closer to filing the IND and initiating the clinical study.
spk07: Okay, great. And then on 904, Could you help us characterize what encouraging activity could look like? What would the threshold of activity need to be to trigger an expansion into a particular cohort?
spk01: Yeah, great question. And, you know, we are continuing with phase one. And I think, you know, we need to keep in mind it's a phase one study that we're running. And the goal of phase one with T cell engagers is you know, first and foremost about evaluating safety and really trying to figure out doses to further explore, you know, further down the road in the expansion stage. So, you know, our goal for the program, as we've stated previously, is to continue to make progress with dose escalation this year to initiate enrollment into backfill cohorts by the end of the year in certain EGFR-positive tumor types. And then as we move into 2024, we'll sit with our partner, Amgen, and talk about potential expansion strategies. Now, of course, moving into formal expansions next year with this program in collaboration with our partner Amgen, I think it's fair to say we're obviously going to want to see an attractive tolerability profile, and also some evidence of tumor shrinkage, of course, as a monotherapy. But this is a phase one study, and our expectations are principally to show the way to doses to look at in later stage studies in the expansion phase.
spk07: Okay, great. Thank you, Sean.
spk04: Thank you, and one moment for our next question.
spk03: Our next question comes from Roger Song with Jefferies. Your line is open.
spk02: Great thanks for the update and taking all questions, maybe just two quick ones from us. The first one is now for understanding you will provide some updates later this year. Just curious what are the nature of the updates you will provide and you know understanding you will you know start to backfill in the EGFR tumor type, but in terms of that data portion, what should we be expecting for the later this year update in terms of dose level, maybe follow-up? And the second question related to the CD71, given you have analyzed the data for some time, what are the current thinking around the next generation strategy or, you know, what you're going to do to the current program in 2029? Thank you.
spk01: Yeah. Hi, Roger. Thanks for the questions. I'll take the second one first, if I may. Not a whole lot of new updates today on CD71. Yeah, we're in discussions with AbbVie regarding getting the license back to 2029. Those discussions are progressing well, and we'll have more to say about our CD71 strategy a little later in the year. Regarding 904, as I've already mentioned, our goal for this year, the operational goal for the program, is to initiate enrollment into backfields by the end of this year. That's the objective that we have. We're not ready at this stage to guide towards timing of any data, presentations. We wanna make more progress, get these backfills underway, continuing close dialogue with our partner, and we'll be issuing further guidance as the year progresses.
spk06: All right, thank you.
spk07: You're welcome.
spk03: Thank you. One moment for our next question. Our next question comes from Mara Goldstein with Mizuho. Your line is open.
spk05: Hi. This is support from Mara. Thank you for taking our questions and congrats on the progress. On CX2029, I know that it's still a work in progress, but I'm just curious what can you, if you can elaborate on the gating factors on the consideration to reacquire the license back from every versus developing a next generation or are both options on the table?
spk01: Yeah, everything's still on the table. And as I said, I think that we'll have more to say about it once we've completed our internal evaluations. And yeah, there are multiple potential ways forward, we think. I think this is kind of a stay tuned moment for the CD71 program.
spk05: Got it. And then for the next generation CD71, if you can elaborate on what features do you hope that you can incorporate to make it a better compound versus the previous gen CX2029?
spk01: Yeah, I think simply put, our next generation strategies that we've been working on internally over the last couple of years would be aimed at further increasing the therapeutic window. It's clear that we've shown that we have opened a window for CD71 with 2029. We are the first company to achieve therapeutically active levels of an ADC targeting CD71 with activity across several tumor types. we have reason to believe we can do better in terms of further opening the window. And again, we'll have more to say about that in due course.
spk05: Got it. Got it. Thank you so much. You're welcome.
spk03: Thank you. And we have a question from Anupam Rama from JP Morgan. Your line is open.
spk00: Hi, good evening. Thanks for taking the question. This is actually Malcolm Kuno on for Anupam. So when should we expect to learn more about which indications are going to be prioritized for CX2051? And then kind of what characteristics will you be looking for in making that determination?
spk01: Yeah, thanks, Malcolm. So one of the things that we've we really love about EPCAM as a target for 2051 is the breadth of its expression across epithelial tumors. Now, if you look into the databases, there's a ton of information available regarding the expression of EPCAM in tumors. And of course, one that really jumps out is CRC. So we're very likely to include CRC as one of our lead indications once we get into the clinic. The payload has also been selected, the Captathicin payload, the TURPO1 inhibitor has also been selected with this in mind. However, there are multiple other tumor types where EPCAM is highly expressed, including gastric, ovarian, endometrial, lung, prostate. It's a long list, and so there's a lot of ways we could potentially go. I think what we're thinking through is the right balance of focus in Phase I We haven't made a firm decision on that yet, but very likely to include CRC, potentially other indications. And in the long run, there's a ton of potential for this drug candidate that we see.
spk00: Great. Thank you.
spk03: Thank you. And I'm showing no other questions in the queue. I'd like to turn the call back to Sean McCarthy for closing remarks.
spk01: Great. Well, thanks, everyone, for your time this afternoon and for your interest in Cytomix. I hope this update on our broad pipeline progress has been helpful. And please feel free to reach out to Cytomix Investor Relations should you or your teams have additional questions. Thanks very much.
spk03: That concludes today's conference call. Thank you for participating. You may now disconnect.
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