Evaxion Biotech A/S

Good morning, and welcome to the Avexian Biotech second quarter 2022 earnings call. All participants will be in a listen-only mode. Should you need any assistance today, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. To withdraw your question, please press star, then two. Please note that this event is being recorded. I would now like to turn the conference over to Corey Davis. Please go ahead.

Thanks, Joe. Hello, everyone. Thanks for joining us this morning. Let me quickly remind everyone that the following discussion contains certain statements that are considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Because forward-looking statements involve risks and uncertainties, they're not guarantees. A future performance and actual results may differ materially from those expressed or implied by these forward-looking statements due to a variety of factors, including those risk factors discussed in the company's annual report on Form 20F, filed on March 31, 2022, and the company's current and future reports filed with or submitted to the Securities and Exchange Commission. At this time, I'm pleased to turn the call over to Lars Wigner, the company's president and CEO. Lars, take it away.

Thank you, Corey. Good morning, everyone. So, thank you for joining us for this Evaction Biotech Q2 earnings call.

I'm Lars Wigner, the Chief Executive Officer of Evaction, and with me today is Evaction's Chief Financial Officer, Bo Karmack. We'll give you a short presentation on our business and results, and then open the call up for your questions. Let me begin by saying that Evaction announced multiple exciting milestones in the second quarter of 2022. Starting with our oncology program in May 2022, we announced a successful production using our Pioneer AI platform of all batches of personalized cancer immune therapy for all patients enrolled in our Phase 1-2A clinical trial of our EVXO2 product candidate for resectable melanoma. Demonstrating once again that Evaction runs a feasible and efficient production chain and that we will successfully manage to provide a truly unique and personalized therapies within this critical time window. The ongoing clinical trial is expected to be finalized according to plan with a full clinical readout in the first half of 2023. In June 2022, we announced the expansion of our third cancer immune therapy program, EVX03, into a new indication, non-small to long cancer, due to encouraging data in preclinical studies. We intend to submit regulatory filing for our phase 1 to 8 clinical trial in the second half of 2022. In addition, as planned, we expect to begin the phase 2b combining EVX01 with Merck's Catruda for the treatment of patients with metastatic melanoma in the second half of 2022. We believe that these significant steps, including the progression of our clinical programs and the successful manufacturing of our EVX02 personalized cancer therapy, highlight the potential for our existing pipeline of cancer therapies to improve the treatment landscape in melanoma, non-small cell lung cancer, and eventually other cancers. In our bacteria program in June 2022, we announced Gonorrhea as the second bacteria target for treatment with our EVXB2 product candidate that we developed using our EDEN platform. We plan to select our first viral candidate from our Raven platform in the second half of 2022. As you may know, Evacuant business model is to develop our programs through phase two before seeking to out-license them. We are actively discussing potential partnership with multiple pharmaceutical and biotechnology companies. Outside of the clinic, we also hosted a key opinion leader webinar with acclaimed expert on metastatic melanoma and personalized cancer immunotherapies. As of June the 13th, 2022, our cash reserve totaled 25.3 million US dollars. We expect these funds, including a use of financial facilities, to support our product development efforts for the next 12 months. The company also entered into an equity financing arrangement for up to 40 million with Lincoln Park Capital Fund, LLC, to further strengthen our financial resilience. This concludes our business and operational update for Q2 2022. I will now turn the call over to Ho for our second quarter financial review.

Thank you. As Lars mentioned, in the second quarter of 2022, we entered into an equity financing agreement for up to $40 million USD with Lincoln Park Capital Fund. As of June 30, 2022, cash and cash equivalents were 25.3 million USD as compared to 32.2 million USD as of December 31, 2021. The decrease in cash and cash equivalents during the first six months of 2022 was primarily related to our operating expenses for the first six months of 2022 partly offset by proceeds received from the first transfer loan from the European Investment Bank. We expect our existing cash and cash equivalents, including use of financing facilities, will be sufficient to fund our operating expenses and capital expenditure requirements through at least the next 12 months. Research and development expenses were 4.1 million USD for the three months ending June 30, This is compared to 5.1 million for the same period in 2021. The decrease was primarily due to lower external costs related to the clinical trials. General and administrative expenses were 2.1 million USD for the three months ending June 30, 2022 as compared to 1.9 million USD for the same period in 2021. The slight increase was primarily due to an increase in fees associated with the expansion of our business as a listed company. Net loss was 4.8 million USD for the three months ended June 30, 2022, or 0.2 dollar loss per basis and diluted shares compared to 6.8 million USD or 0.36 dollar loss per basis and diluted shares for the three months ended June 30, 2021.

Thank you, Bo. That concludes our presentation today. And now it's time to open up the call for any questions.

We will now begin the question and answer session. To ask a question, you may press star, then 1 on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star, then two. At this time, we will pause momentarily to assemble our roster.

Our first question will come from Thomas Flatton with Lake Street Capital Markets.

Please go ahead.

Good morning, guys. I appreciate you taking the questions. Lars, I was curious if you could comment on the ongoing delay in first patient in for the Phase 2B EVX01 study. It's been a while since you guys got clearance. I know you were screening patients actively, but I was just hoping you could provide some color around that.

Yeah, good question, and thank you for that. So we actually had the first initiation of the first site actually today. We plan to open 25 sites and we have patients being screened as we speak. So we are expecting actually the first patient to be starting very, very soon. We had a smaller delay compared to what we actually announced earlier this year, which was primarily due to logistics and planning. We expect to be able to actually get that delay kind of cut back during the next couple of months, so it will not influence any of the readout of EVX01. But we are actually quite happy that the initiation of the first site was actually today. And then we are, of course, opening up additional 24 sites to have a fast recruitment, so we will expect to have the readout as planned.

And then any updates on the regulatory submissions in the EU and US for EVX01?

Yeah, that's actually moving according with the plan. We start the first five sites actually in Australia and then we plan to open up in Europe. And we will, of course, also announce when we have the first sites up and running in Europe and US. But that is moving according with the plan. But the first five sites sites will be opened in Australia, where we have actually also a lot of experience in running our previous trial, such as EVX02, and where we also have a very, very broad KOL network with people like Georgina Long.

And then one kind of non-clinical question. Any... I know it's only been a few weeks since your transition was announced, but any updates on timing of transition from the old company to the new company, et cetera, for the incoming CEO?

We expect to be able to announce the exact date within a matter of weeks, as, of course, our new CEO, Pierre, will announce. have to arrange that with his current company. So we'll expect to have a firm date within a matter of weeks. And, of course, we hope he will start soon so we can have a very, very solid transition. But regardless of how and when he is starting, I am not, as I probably also mentioned earlier, leaving for another company. So I will be there to help out as long as needed.

Excellent. I appreciate you taking the question. Thank you. Thank you.

Again, if you have a question, please press star, then 1. Our next question will come from Ahu Demir with Leidenberg Thalmann. Please go ahead.

Hello, everyone. Thank you for taking my questions. This is Chong Liu for Ahu Demir. I have two questions. Can you please give us more details on the EVX03 in non-small cell cancer in terms of the patient population, treatment regimens, and timeline? And my second question is, could you please give us some information on the data from the platform LDiP to predict responders and non-responders? When can we see the data and in what format? Thanks.

Thank you, and very good question.

So let's start with the first one on non-small cell lung cancer. So right now, of course, we are in the midst of preparing for that trial, and we are targeting first-line metastatic non-small cell lung cancer in combination with checkpoint inhibitors. We have also announced that we expect to do our regulatory filing in this second half of 2022, and we expect to be able to deliver on that More details on the different timelines we will be sharing in the upcoming months as we progress on this submission. But we expect to be able to deliver on the timeline that was also previously communicated when we launched the program. And AI Deep, which is a truly interesting platform that is able to predict who will respond to immune therapy in general not just our immune therapy but also checkpoint inhibitors we had some very interesting data when we have basically run all our patients through it and it was very precise in being able to predict who responds to a combination therapy right now we are actually gathering additional data to validate it on a data set from other studies. And as soon as we have that data and have run it through AID, we will be sharing that data. We don't have an exact timeline for that, but our expectation is we'll be able to share data around the year, shifting from 22 to 23 with a lot more patients. And there in that setting, of course, also what is our business model for this new platform?

Okay, that's really great.

Thank you very much for taking my questions. You are welcome. This will conclude our question and answer session.

I'd like to turn the conference back over to Lars Wegner for any closing remarks.

Thank you to you all, and thank you for joining us today. This concludes today's conference. You may disconnect your lines at this time. Thank you.