Nanobiotix S.A.

Good afternoon and good morning, and welcome to Nanobiotics Conference Call to discuss our 2021 Full-Year Financial and Operational Results. Joining me on the call today are Laurent Levy, Co-Founder and Chief Executive Officer, and Bart Van Ryn, Chief Financial Officer. As a reminder, today's call is being webcast and will be available on our website for replay. I'd like to remind you that this call will include forward-looking statements, which may include statements regarding the progress, success, and timing of our ongoing and planned clinical trials, collaboration, regulatory filing, dates of presentation, and future research and development efforts, among other things. These forward-looking statements are based on current information, assumptions, and expectations that are subject to change. They are subject to significant risks and uncertainties that could cause the company's actual results to differ materially from our current expectations. Accordingly, you're cautioned not to place undue reliance on forward-looking statements. please review the full description of risk factors that can be found in the documents we file with the AMF in France and the SEC in the United States, including the URD and 20F filed in their last version, both of which are available in the Investor Relations section of our website, along with the press release issued yesterday highlighting our corporate and financial results for the period. In addition, any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date While we may elect to update these forward-looking statements, at some point in the future, Nanobiotics undertakes no obligation to update them to reflect subsequent events or future circumstances. With that said, I'd like to turn the call over to Laurent. Laurent, please go ahead.

Thank you, Kate. I would like to welcome everyone participating via conference call and webcast today. This is a busy and exciting time at Nanobiotics, and I'm pleased to have this opportunity to highlight some of the important progress our team has made in the past year, provide some additional insight as what we expect in this year, and why we continue to be excited by the potential of our lead product candidate, NBTXR3. As we outlined in January, our priorities for 2022 include focusing our internal development efforts on our two lead programs, including the execution of 312, Our global pivotal study of NBT-XR3 as a single agent activated by radiation in locally advanced head and neck cancer patients. And two, the advancement of our follow-on checkpoint inhibitor combination program seeking to expand the treatment benefit of NTPD-1 therapy. In parallel, we will continue to leverage our existing key collaboration to advance and expand our pipeline while we evaluate potential new collaboration that could contribute complementary development and or commercial capabilities. As we continue to expand our operating efficiency and carefully align our resources with the strategic priorities supported by BAR and the rest of the leadership team, we seek to both maximize and deepen our operational expertise in key functional areas to support our continued growth. During 2021, we took several key operational steps to position us to build the foundation of future opportunity and achieve this goal in 2022. In May 21, we added a new strategic partner, Lian Bio, to advance and expand the development of MBT-XR3 in Asia. We are pleased to have found a partner that is committed to revolutionize patient outcomes, share our strategic vision for MBT-XR3, and bring substantial regional expertise that should enable a meaningful contribution to our global development initiatives. YoungBio will be a key partner for us in our head and neck registration study, enrolling 20% of the 500 patients we plan. Preparation for this are already well underway, and we'll currently expect YoungBio to initiate patient enrollment in STD 312 in the second half of 2022. In addition, YoungBio has committed to participate to four additional registrational studies with MBJXR3 across syndication, and therapeutic combination, funding all the development and commercialization expenses in their territory, highlighting their belief in and commitment to the broad potential of MDT-XR3. This commitment to the long-term vision for MDT-XR3 mirrors that of our ongoing work with MDUnderstand. We've been engaged in a broad collaboration with MDUnderstand since 2018. Their research and development support has already generated robust library of preclinical data, particularly around the combination potential of NBT-XR3 with immune checkpoint inhibitor, this resulting in multiple presentation and publication. In 2021, MD-Undersun initiated the fifth clinical trial with NBT-XR3 under its collaboration, which now includes three phase one studies, exploiting the safety and feasibility of NVTX artery in pancreatic cancer, in esophageal cancer, and non-small cell cancer. And additionally, two Phase II studies exploring the potential efficacy of NVTX artery in combination with immunotherapy, this in head and neck. Having already reported the first patient case study from MD Anderson Phase I pancreatic study, anticipate the dose escalation of that study to reach its target, recommended Phase II dose later this year. Similarly, MD Anderson phase 1 study of MBCS-SAR3 in combination with chemo is also expected to report recommended phase 2 dose in 2022. In addition to expanding our external development capabilities, we also significantly strengthen our leadership team with the appointment of Gary Phillips as chairman of our supervisory board, bringing decades of experience in the pharmaceutical and healthcare industry, and Bart Van Ryn, as our Chief Financial Officer bringing proven capabilities in global financial management, business development, and pharmaceutical commercialization. More recently, we were pleased to welcome Dr. Len Farber, a board-certified medical oncologist, as our new Chief Scientific and Medical Affairs Officer, adding extensive executive experience in developing and growing treatment centers and departments within the radiation oncology field. Each of these individuals had already had a tremendous impact on the company, driving execution across key programs and contributing to a culture of innovation, integrity, and inclusion, while fostering transparency and accountability. Now, before I turn our attention to the results and expectations for internal development before, I would like to ask Bart to provide a brief review on our financial results. Bart?

Thank you, Laurent. As Kate mentioned, yesterday after the close of the US markets, Nanobiotics reported financial results for the year ended December 31st, 2021, while highlighted our financial position as well as our recent progress. As described in the release, our total revenue, consisting primarily of revenue related to our prior collaboration with PharmaEngine, totals approximately €10,000, compared to €50,000 for the year ended December 31st, 2020. All our income for the period includes research tax credits, which increased from €1.9 million in 2020 to €2.5 million in 2021 due to an increase in research and development expenses. Our research and development expenses for the year were €30.4 million compared to €24.3 million for the year ended December 31, 2020. This increase reflects the increased clinical trial development costs related to the company's priority pathways, including preparation and initial site activation for our pivotal phase three registration study, NanoRay 312, and our immunotherapy combination study, 1100. Selling, general, and administrative expenses were 19.4 million euro for year-ended December 31st, 2021, compared to 14.6 million euro for the prior year period. This year-over-year increase was related to a change in headcount mix and geography, recruitment expenses, and expenses resulting from the NASDAQ listing, and reflects a significant decrease in SG&A during the second half of 2021, a trend that is expected to continue year-over-year in 2022. Metabiotics net loss was €47 million for the year, compared to a net loss of 33.6 million euro for the 2020 fiscal year, which includes 5.4 million euro in auto operating income and expenses related to the termination of the pharma engine agreement in early 2021 and financial income of 5.6 million euro driven by currency translation gains. We ended the year with cash, cash equivalents and investments totaling 83.9 million euro compared to the €119 million as of December 31, 2020. This net decrease of €35.3 million reflects €51.8 million of net cash flows used in operating, investing, and financing activities of nanobiotics, which was partially offset by the €16.5 million, or US$20 million, upfront payment associated with the LiamBio collaboration announced in May 2021. Finally, as we continue to optimize our capital allocation and drive ever-increasing efficiencies and flexibility in our cost structure, we anticipate that our cash, cash equivalents, and multiple securities as of December 31st, 2021 should enable us to fund operations well into the second quarter of 2023. And now I'll turn the call back to Laurent to discuss these programs in further detail. Thank you, Bart.

Progress in across our development program afforded us the opportunity to provide several data updates over the course of 2021, each adding meaningful support to our hypothesis that NBTSR3 offers a unique opportunity to expand and expand potential clinical benefits across spectrum of cancer or solid tumor. And this both as a single agent activated by radiation therapy, as well as in combination with other products on the market and under development. Rather than detail previously announced data set and milestone achievement individually, I would like to take this time today to provide an integrated view on how we believe this results provide insight into the future opportunity for NBTX R3 and position us to achieve our development goal for 2022. Certainly, a key priority for us is the timely execution of Nanoway 312, and successful registration of the product for the treatment of locally advanced head and neck cancer in patients that are intolerant to standout care like in-home-based chemotherapy. Based on the consistently high response rate seen across multiple studies, we have long been confident in the potential for NBTX-R3 to provide survival benefits in this patient group and secure fast-track designation in 2019 to potentially accelerate this opportunity. In 2021, we had the opportunity to report the first survival data from ongoing study 102, validating this hypothesis. As we presented at ASTRO 21, high-risk elderly patients with locally advanced disease that were ineligible for C-plating and intolerance to subjectinase achieved a median survival of 18.1 months and median progression-free survival of 10.6 months in the available population as of September 21, 2016. Response rate remained consistent with previously reported results from both dose escalation and dose expansion phase, showing a response rate of 85.4% and complete response of 63.4% in the target region. Given this consistency, we were not surprised but certainly pleased by an internal review of data from February KETA update this year, Continued improvement with an ongoing median overall survival of 17.9 months in the all-treated population, which includes 66 patients, and 23 months in the 44 evaluable patients. We are not only pleased by the treatment effect observed in patients enrolled in this study, but we are highly encouraged by the implication for the 312 study, or pivotal study. As you will recall, patients meeting the criteria for study 102 are historically food to treat. They are generally older with a higher level of comorbidity than patients eligible for study 312 and have two or three times the prevalence of comorbidity compared to the overall locally advanced population. While there are no direct comparator literatures suggest that locally advanced patients with a better prognosis than all patients have a median overall survival of approximately 12 months, providing us with what we believe is a conservative estimate benchmark. On an operational front, Study 102 has no completed enrollment, with the last patient expected to complete their last treatment within the next month. This allows us now to leverage 102 sites with historically high enrollment for Study 312. As part of our site selection process, we have selected eight sites of the 102 sites for participation of the Study 312, representing approximately 10% of our expected European insights. As we look more broadly at European insight plans, we are sensitive to the pressing geopolitical concern and instability in Ukraine and Russia. While we do not have any one or two sites in the region targeted for the 312, we have previously planned to activate a small number of centers in this region as part of the 312 study. These sites were not scheduled for activation until the second half of 2022, and we are actively working with our CRO to identify alternate sites and countries. And as of today, we do not expect any impact on our overall timing or execution of the study 312 at this time. Looking ahead, we plan to continue adding sites across Europe through the year and expect to activate our first U.S. site in mid-2022. In parallel, our partner, EMBIO, was expected to contribute approximately to 100 patients of the 500-patient plan, have been actively preparing to initiate Study 312 in China, and currently anticipate beginning patient enrollment in the second half of 2022. Overall, execution since the start of the study has been in line with expectations, and we are pleased with the ramp-up we are seeing. We look forward to gaining additional insights on patient enrollment rates, and as more sites and countries come online, I look forward to keeping you updated on this progress. Now, turning our attention to our IELTS Combination Program, I will again note that we were pleased to provide two updates related to our ongoing study at ASCO and ASTRO. These presentations were complemented by new clinical data, journal publications, and further review of the clinical data and clinical findings by a few of our key opinion leaders in June. These data, like our study 102 data, are available on our website, and I would encourage those of you that have not yet had the opportunity to review to do so. As this data update made clear, evidence continues to support our hypothesis that the physical mechanism of action of NDTX artery triggers a subsequent priming of the immune system that, when paired with immune checkpoint inhibitors, allow for a better-than-expected response to MCPD-1 treatment among not only naive patients, but also appears to rescue prior treatment failures. But daily data from study 1100 presented at ASTRO remain consistent with prior data sets, demonstrating a disease control of 81% in the available population, including 73% percent in patients with prior, primary, or secondary resistance to anti-PD-1. In the 16 evaluable patients, three complete responses and five partial responses were reported. Notably, only one progressive disease was reported in the evaluable population. Some delayed tumor response and or abscopal effect were also reported, suggesting that NBT-XR3 may potentially crime an immune response To date, this activity is paired with a tolerability profile similar to what is traditionally seen with radiotherapy or anti-PD-1 therapy. Study 1100 is a basket trial, including three cohort of patients in the dosage condition phase. The first one are local regional recurrent or recurrent metastatic head and neck cancer patients. The second one are lung metastasis from any primary cancer that is eligible for anti-PD-1 therapy. And the third one are liver metastases from any primary cancer eligible for anti-PD-1 therapy. Considering the competing data we have seen from this study demonstrating the potential to both increase the response rate and anti-PD-1 treatment, as well as rescue prior treatment failure, we have updated our planned expansion phase of this study to explore this potential more fully in head and neck cancer patients. Therefore, the extension phase will divide patients into three new cohorts. Cohort 1 will include only head and neck cancer patients naive to NTPD1 treatment. Cohort 2 will include only head and neck cancer patients resistant to prior NTPD1 treatment. And cohort 3 will combine patients with lung, liver, or soft tissue metastasis from any advanced cancer eligible for NTPD1 treatment. Enrollment in each of these calls is expected this year and will begin after reaching the recommended phase 2 dose for each patient group. In addition to informing the expansion phase of study 1100, the data generated to date have also added to our sense of urgency in defining a registration path for radiation-activated MDT-XR3 in combination with immune checkpoint inhibitors. and we have initiated discussions with the FDA to guide us in this process. Preliminary feedback has been very encouraging, and we will be working with the aim of finalizing a protocol and proposed regulatory pass for review by the end of this year. While our clinical program exploring the combination potential of our product candidate with approved anti-PD-1 treatment represents the priority pathway in our combination strategy, we have presented clinical and all preclinical data that support the potential synergy of NDT-XR3 with chemotherapy, Lactree, TGIF, and CTLA-4. Early last year, we presented initial data from the dose escalation phase of our chemo combination study in rectal cancer, and look forward to update those results along with the phase one chemo combination study in head and neck cancer to be presented next quarter by our former partner in Asia. Further, both our previously reported and ongoing preclinical work suggests that as the oncology treatment landscape continues to evolve and innovation leads to promising new product candidates, NBT-XR3 may be uniquely suited to revolutionize the pillar of cancer as a foundational component of future treatment, potentially having efficacy without increasing safety or tolerability concerns. We remain committed to fulfilling this promise through discipline execution and look forward to continuing to advance our development program through 2022 and beyond. We hope to make a significant impact on unmet needs with our solid tumor agnostic, IO combination agnostic platform. Before I open the call for questions, I would like to thank our patients, investigators, and collaborators. Your support and contribution to our mission are invaluable and our successes would not be possible without you. We would now be happy to open the call for questions.

Operator?

Ladies and gentlemen, we now begin the question and answer session. If you wish to ask a question, you can press star 1 on your telephone or you can type your question on the ask a question box.

All right, team, while we're waiting for questions to queue up on the call, we have received a few inbound questions from investors prior to the start of the call, so I think we'll get started there. There have been a number of questions on similar topics, so I've aggregated the questions with the hopes that you can address them. So we did receive a number of questions regarding the status of 312, which we addressed during the call, and how we plan to communicate around the progress in that study going forward, and specifically questions regarding the status of that study on criticaltrials.gov.

Thank you, Kate. So as we just mentioned some minutes ago, the 312 study is progressing well according to plan. Sites have been initiated already last year in Europe, and the first station has been injected beginning of January. So now we're progressing according to plan. with the GoToOpen outside Europe, the US site for Me22, and the Asian part with our partner EMBIO for H2 this year. In regards to clinicaltrials.gov, the update has been made last week and will come to life as soon as they are validated.

Okay, great. One more question from our investors before we go to questions on the line.

The next regard, status updates related to our non-priority pathways, including where we stand with the liver study, the prostate study, and both of the chemo combination studies conducted in Asia.

Just as a reminder, the priority of the company is really to move forward this phase three trial in head and neck cancer. And the priority, too, is to open this new path for registration within the IO combination field. So we believe that those two patches will be ensuring the success of the company. Now, as you know, our product has a wide applicability and could go for many other tumors. So the other trial we've been running for us are opening new door for potential future liver outgrowth. Just as a reminder, the head and neck trial with chemotherapy and radiation Data will be presented in Q2 this year. And concerning the trial on the rectum cancer, again, with radiation chemo plus natto, will also be reported in Q2. So we are very happy with the data generated in liver and prostate and other trials. So after we develop and move forward in the two priority pathways, we will start exploring other opportunities for NBGX arteries.

Operator, I think we can turn to the question that we have on the line right now.

We have one question from the phone. He's from Jonathan Miller from Evercore IC. Please go ahead. Your line is open.

Hi, guys. Thanks so much for taking the question. I guess a lot of what I was really curious about from the release has been addressed in your prepared remarks. Thank you. But I will focus, I guess, instead on financials. You say you've got to run way well into 2Q of next year. That gives you about 12 months of cash. But obviously, registrational data, which I think is the big catalyst, isn't expected until possibly as late as 24. So I was wondering what you were thinking about your cash position and how you were thinking about the prospect of some sort of financing and what your priorities were from a financing perspective.

Thank you, Jordan. This is Bart van Rijn. As any other biotech, we're always evaluating all our options to ensure sufficient capital on hand and disciplined capital allocation. We're sensitive to capital delusion, even more so given the current state of the markets. We look forward to keeping you apprised on the progress and are feeling good about what is ahead of us. We've initiated cost optimizations program that are bearing fruit already. And we're very excited about the two strategic partners that we're collaborating with, both Andy Anderson and Liam Bile, which allow us for a very efficient pathway from a development perspective.

Thank you. Great. That makes sense. And then, well, I guess one follow-up then, since we're talking about those collaborations. I think we're all excited to see a little bit more out of those MD Anderson trials, both in terms of the different combos and the different indications that they're exploring there. In terms of the data that you have said we should expect to see in the next year, it seems like there's a bunch of different data sets coming. What do you think is the most important catalyst for you guys in those upcoming data releases? What should we be paying most attention to in terms of the ability to really generate interest in the nano story?

So I think we have a rich year in front of us. We said that in Q2 we will report two new set of data, one in the expansion phase of the rectum cancer, the other one in the head and neck chemotherapy setting. That's the first part. We also wait for second part of the year, the RP2D of the pancreatic cancer trial that is done at MD Anderson. The overall program there, including esophageal cancer, non-small cell lung cancer, and two phase two in head and neck in combination with DIO is also moving in the right direction. Where we really want to focus the attention is in the definition of what's going to be our path to market with the IO combination. A recent discussion with FDA let us think that we will have enough to start defining what should be this path, and we intend to communicate that to market by the end of this year to make sure we have another people who are trying to run in parallel to the TREAT level.

Is there any possibility that that IO combination path would be more rapid than 312? Is there any possibility that the IO combo could be approved before the head and neck studies read is done?

If there's nothing we can say at this stage.

Okay, fair enough. Thank you so much. That really helps.

Thank you for your question. I hand back the conference to the speaker for Webcast College.

Yes, we have received a question online from Clement Bassett from Postman Park. His first question, I think, was just covered in our Q&A, so we'll move to question two, which is asking if you could please provide the breakdown of your R&D expense per program for 2022.

Yes, thank you. Thank you, Kate.

Thank you for the question. For 2022, the majority of our expenses will relate to the Phase 3 NanoWave 312 study, which will be reaching a peak as we expect the enrollment to reach its peak in 2023. or part of the expenses will primarily relate to the 1100 study, which is our IO combination, in line with the two priority pathways that we have explained.

Very good. Thank you for that clarification, Bart. We do have another question that was submitted online during the call asking what we can expect from the discussion about immunotherapy with the FDA. Do you want to add some color to that one, Dr. Frick?

We could, I think we've discussed this topic a little bit already. What we could say and what we were expecting with this meeting is really to clarify questions about the population, about the use of the CD1, about the type of endpoint we should use to move forward into market. And we've been very satisfied with the answer we got. And now we are in the active phase of designing this program with our internal team and external PI. So we're really keen to continue that and to as fast as possible present to you what is our plan to move forward.

Thank you for that Laurent. Our final question actually is a combination of a couple of questions that were submitted in advance and they relate to our ongoing work with Curidime and if you could provide a status there as well as work related to the CMS platform.

Sure.

So just to put that into context or perspective, our priority, meaning the investment and the attention of the vast majority of the company is focused on development of NBGXR3. Nevertheless, there is a small team working for the future and preparing what will be our next platform. And we have two platforms in that regard under development at a critical stage. The first one is Curadime and the other one is linked to CNS Disorders. So in the previous first platform, Curadigm, there is an ongoing collaboration with Sanofi that has been extended to continue preclinical work. And that should provide some data in the future. According to the previous development we've made, and I think you can look at the patents we have published, and you will see the content of those two platforms. If you go to the one concerning the CNS, This is moving at the right pace from a predicting goal perspective and establishing proof of context and we'll report things as soon as we think it's agreeable after having moving our priority program in NBGXR3.

All right, well, it looks like that concludes the Q&A session for today's call. We'd like to thank everyone for joining us in today's discussion and look forward to keeping you updated on future calls as the year progresses. Thank you.