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Operator
Hello and welcome to 270Bio's second quarter 2022 financial results conference call. At this time, all participants are in the listen-only mode. Following the prepared remarks, there will be a question and answer session. Please be advised that this call is being recorded. I would now like to turn the call over to Jen Snyder, Head of Corporate Affairs. You may begin.
Jen Snyder
Thank you, Operator. This morning, 270Bio issued a press release providing a business update in addition to second quarter 2022 financial results. The press release can be found in the Investors and Media section of the company's website at 270Bio.com. On the call today are Nick Leshley, Chief Caross Officer, Chip Baird, Chief Financial Officer, and Steve Bernstein, Chief Medical Officer. As a reminder, today's discussion will include forward-looking statements related to 270Bio's current plans and expectations which are subject to certain risks and uncertainties. These forward-looking statements include statements regarding our strategic plans, timelines, and expectations, and statements regarding our financial condition, expectations, and other future financial results, among others. Actual results may differ materially due to various risks, uncertainties, and other factors, including those described in the risk factors section of our most recent forms, 10Q, 10K, and other SEC filings. These forward-looking statements represent our views as of this call and should not be relied upon as representing our views as of any subsequent date. You are cautioned not to place any undue reliance on these forward-looking statements and, except as required by law, we undertake no obligation to update or revise any forward-looking statements. At this time, I would like to turn the call over to Nick Lushley. Nick?
Nick Leshley
Thank you, Jen, and good morning, everyone. Thanks for joining us for an update on the second quarter 2022 results. Last week, 270 passed the 270-day milestone since the launch of our company. So I'll spend a few minutes talking about the recent company highlights, including the fantastic news announced this morning with our partner BMS on the Karma 3 study. Then I'll hand it over to Steve and Chip for a bit more on the clinical and financial side of the house. After that, we'll be sure to get to your questions. We're off to a great start for the first half of this year. Our 270 team is gelling as we build across several tracks. We continue to treat as many patients as we can, and as previously stated, we're committed to capacity improvements, which we've been able to achieve. We're tracking towards the high end of our anticipated 2022 revenues for our Beckman sales. And on our clinical side, our pipeline continues to progress with multiple clinical stage programs in both BNHL and AML, as well as emerging set of programs in solid tumors in collaboration with Regeneron. Zooming out, the mission of 270 is clear and powerful. Existing standards are good, but not good enough. The immunotherapies have opened the door to the immune system, but are also not yet good enough. 270's ability to design next-gen cell therapy product solutions that both integrate novel technologies and also partners across modalities is unprecedented and exciting. Perhaps George Yannikopoulos from Regeneron recently publicly said that when you're layering and integrating modalities, we are on the trail to the holy grail. This is a statement we firmly agree with. On the financial front, we took the time during the earlier part of this year to reshape our operating model and reduce our overhead costs. We continue to evolve to meet the needs of the growing ABECMA opportunity that BMS recently outlined in their earnings call, including exciting top-line growth. On the cost side this quarter, we saw an increased investment in ABECMA ramp-up activities and higher than anticipated vector costs. You will hear more detail from Chip on how this has impacted our near-term guidance, Importantly, we remain confident in our runway into 2025. Shifting gears, we are extremely excited to share the great news regarding our earlier line study, phase three study for a BACMA called CARMA-3, studying patients with two to four prior lines of therapy. After performing a pre-planned interim analysis and receiving the recommendation by the Data Safety Monitoring Board, the study was unblinded and has met its primary endpoint of demonstrating a statistically significant improvement in progression-free survival. It's hard to overstate our excitement for patients with myeloma. And along with BMS, this news certainly increases our conviction of the potential of a BACMA over the long term. It is both exciting and humbling. With that, I'll hand it over to Steve, our chief medical officer, to give a bit more of the exciting news of today and clinical updates this quarter. Steve?
Jen
Yes, thank you, Nick. Good morning, everybody. It is an incredibly exciting day indeed. So to expand on the updates that Nick shared this morning, 270, and BMS issued a press release announcing positive top-line results from a pre-specified interim analysis of CARMA-3, which is a phase three, global, randomized, multicenter, open-label study that evaluates a BECMA in relapse and refractory multiple myeloma patients who have had two to four prior lines of therapy. They must have been refractory to their last regimen, and have been previously exposed to a proteasome inhibitor in IMID and daratumumab, so-called triple exposed. And the outcome of these patients was compared to that of standard combination regimens. This makes abecma the first BCMA-directed CAR T therapy to demonstrate clinical superiority versus standard regimens in a randomized controlled trial. Indeed, these results came ahead of schedule compared to our original timing guidance of data in 2023, and we are so pleased for what these data could mean in terms of potential paths to treat earlier line patients. The study met the primary endpoint of progression-free survival, and the safety results were consistent with the well-established and predictable profile demonstrated in the pivotal CARMA trial. We, along with Bristol-Myers Squibb, expect to present additional data from this study at a medical meeting in the future and discuss these findings with health authorities. We also presented additional data for ABECMA in June at the 2022 ASCO Annual Meeting, including the largest data set to date for ABECMA patients treated in the commercial setting by the Multiple Myeloma Cell Therapy Consortium of Academic Institutions. The data presented were consistent with what was seen in the pivotal CARMA study, despite the fact that the overwhelming majority of such patients would not have met the eligibility criteria of CARMA, reinforcing the efficacy and safety profile of the BECMA. Looking forward, we expect to share proof-of-concept data for our CARMA 2 study in high-risk, early-stage multiple myeloma in 2022 that will further inform our earlier line development plans. In addition, at ASCO 2022, we presented updates from our portfolio of oncology cell therapies, a trial-in-progress poster on CRC403, a Phase I-II study of BBT369 in patients with relapsed refractory B non-Hodgkin's lymphoma, and the trial-in-progress poster on PLAT-08, a Phase I study of SCDARIC33 in relapsed, refractory, pediatric, and young adult AML presented by Seattle Children's Therapeutics. Overall, this is a very exciting time for 270 as we move many years of efforts into translational stages supported by a significant ongoing ramp up of our internal drug manufacturing throughput that's needed to drive our overarching strategy of moving rapidly into efficient and exhaustive proof of concept studies in the clinic Quite a privilege and looking forward to sharing more. Now I'll turn the call over to Chip for a deeper dive on the second quarter results. Chip?
Nick
Thank you, Steve, and good morning, everyone. During the second quarter, ABACMA generated $72 million in U.S. commercial revenue, up 29% compared to the prior quarter. As a reminder, we share all profits and losses related to ABACMA equally with BMS, for the development, manufacturing, and commercialization of ABECMA in the U.S. We continue to see very strong demand for ABECMA, and we're pleased with the growth trajectory there. We remain on track to achieve the high end of our 2022 U.S. ABECMA revenue guidance of between $250 and $300 million. We reported our share of collaboration loss of $4.3 million for the second quarter, which includes our share of gross profit, less costs, associated with commercialization of a VECMA in the U.S. Given the strong demand for VECMA and our growing belief in the potential for this therapy to play an important role in earlier lines, we've been making significant investments to increase manufacturing capacity across the supply chain. In addition to our manufacturing capacity investments, we have experienced costs for VECTA that were higher than anticipated. This does not affect our 2022 revenue target, as we believe we have sufficient vector to achieve that target, and we are continuing to invest in increasing manufacturing manufacturing capacity in the future. That said, we are partnering closely and supporting BMS in their efforts to lower manufacturing vector manufacturing costs and continue to increase manufacturing capacity. Between the capacity investments and the higher vector costs, we are increasing our 2022 to $265 million. We continue to forecast cash runaway into 2025 based on our current operating plan. This runaway is sufficient to achieve important milestones across our business. I'd now like to turn the call back to Nick for closing remarks. Nick?
Nick Leshley
Thank you, Chip, and thank you, Steve. As you can see, it has been a very productive and rewarding quarter. Much to be excited about here at 270, and I'm grateful to our team who have all demonstrated such tremendous dedication and focus over the past few months, if not the past few years. In closing, I'll just say that our mission as a company, what drives us every day is the concept of time. It's pretty simple, but it's very powerful. Giving the people we serve more time by developing new therapies at the rough cancer treatment landscape is what 270 was designed to do and what we are all focused on. We look forward to sharing more updates in the coming months as we continue to advance this mission. With that, Kyle, operator, we're ready for questions.
Operator
All right, so as a reminder, to ask a question, you will need to press star 1 1 on your telephone. Once again, that is star 1 1 on your telephone keypad. Please stand by while we compile the Q&A roster. All right, your first question comes from the line of Salvin Richter from Goldman Sachs. If your line is now open, please ask your question.
Salvin Richter
Hey, good morning, and thanks for taking our question. This is Elizabeth for Salvin. Just wondering if you could kind of comment on the powering or how stringent the criteria was to stop at the pre-specified interim analysis. And then, you know, if there's any comment on CR rate that you could provide. and then a follow-up on vector supply for 2023 and how to think about that. Thank you.
Nick Leshley
Thank you. Just a heads up here, I'll pass it over to Steve, but as you can imagine right now, we're obviously, the data is continuing to be crunched here and will be, as we said in the script, communicated later at a medical meeting. So I'll pass it over to Steve to share what he can, but just heads up, it'll be pretty limited. Steve?
Jen
Yeah, sure. Thanks, Nick, and thanks for your question. It was a pre-specified analysis. This was our interim analysis for superiority, and the DSMB recommended that we unblind the study, and it was a positive result. In terms of response rates, I can share that the secondary endpoint of overall response rate was met and was statistically significant. But at this time, that's all that I could share.
Nick Leshley
And on the vector supply question, Chip, do you want to take that one?
Nick
Sure. Thanks, Nick. It's a good question. Yeah, we've continued to make step-ups throughout this year in terms of our weekly capacity, in terms of patients that we can provide drug product to. We continue to work with the regulators to make additional step-ups, and we have plans to make step-ups later this year and in 23 as well. So that is a picture that month-to-month, quarter-to-quarter continues to improve, and we should have more to share in terms of our outlook for 23 as we get closer to the end of this year.
Salvin Richter
Awesome. Thanks so much and congrats on the update.
ABECMA
Thank you.
spk06
One moment while we queue up for the next question.
Operator
Your next question comes from the line of Dana Graybosh from SVB Securities. Your line is now open. Please ask your question.
Dana Graybosh
Hi. Thanks for the question. A couple follow-ups on the previous ones. Can you just remind us the statistical design for Karma 3? In particular, what triggered the event that triggered this interim, and what were the primary and secondary? And if you will, since you said the OR is secondary, sort of how far down the secondary hierarchy you were able to get? And then on cost, can you help break down the net cash spend you expect, the 245 to 265 chip? Can you help us understand how much of that is on discovery, on your early clinical programs, and then on a BECMA program, and then how much is being spent, as you said, on supporting sort of scale-up and manufacturing for a BECMA? Thank you.
Nick Leshley
So first question here, I'll pass that off again to Steve, but maybe you can go through the top line, some of the design questions. But we're not dancing down the chart. The data that we've given so far is what was driven. That was the PFS and OR. Both subways were statistically significant. So that's the extent of the data we'll be sharing at this point. But if you zoom out, I'm sure Steve has a few comments, and then we'll go over to Chip. Steve?
Jen
Yeah, as Nick mentioned, the primary endpoint was PFS, and that was the primary endpoint for which the interim analysis statistics were driven. The key secondary endpoints were response rate, and as we mentioned, we can say that both the PFS and the overall response rate was significantly improved. Overall survival is a key secondary endpoint, and the follow-up for overall survival remains ongoing. I'm not sure if there were any other, Dana, questions.
Nick
If you could talk about what specifically was the pre-specified trigger to do the PFS analysis?
Jen
Yeah, I'm honestly not sure how much I could really get into that, to be very truthful.
Nick Leshley
Okay. But it was pre-planned, right? It's pre-planned.
Jen
Yeah. It was pre-planned in terms of events. So it was an event-driven pre-planned analysis.
ABECMA
Great.
Nick Leshley
And Chip, do you want to cover off a little bit of the breakdown of the net?
Nick
Yeah. So, Dan, it's a good question. And there is disclosure in our 10-Q that can give you an even better feel for how the investments across programs meter out. From a development perspective, IDASEL remains our biggest investment with the various CARMA studies and investments in manufacturing scale up. 369 is the next largest, and DEREC 33, also a clinical stage program. The balance is earlier stage research programs, collaborations with Regeneron and other partners there. On the manufacturing side, I can just comment, we've invested both on the drug product side together with BMS in terms of scaling that capacity And then, as I mentioned, continuing to work on vector supply and increasing scale there.
Nick Leshley
And one thing I might just add to that, one of the things that we've been working on, and Chip referenced it in his script, or we both did, which was as we spun the company, we continued to make sure we're fit for purpose across the business, right? And as we level in on that, that's something that's still certainly ongoing. We're making good progress on. But we feel pretty good about the team that we have for the purpose that we have. That is not just a BACMO. but is also very much believing in the future of the technology and approach that we have. And that's what I was referring to a little bit there. So pretty aggressive investment in that side as well as research and what we call Horizon X is certainly ongoing in there. But the bigger driver certainly for the burn and the burn increase here has to do with ABECMA.
ABECMA
Next question.
Dana Graybosh
Thank you.
ABECMA
You're welcome. Thank you.
Operator
All right, so for your next question, it comes from the line of Geron Weber from Cohen. If your line is now open, please go ahead.
Geron Weber
Yeah, hi, good morning, and congrats on the data. I know you can't say a lot, but I wanted to just probe a little bit. When you're thinking about second to fourth line, I mean, you can have doublet or you really have triplet therapies here. It could be, again... did you expect some patients to get Darzalex again, or are they typically getting another IMID and sort of another PI? And if you can, what do you think is the comp in terms of prior data with respect to PFS and ORR? I mean, there's obviously triple exposed, so the question is what they were getting at that point. And then secondly for CHIP, We're beginning to see a little bit of a range for you now for the collaboration with Bristol on OpEx. And I know that's going to be obviously variable depending on spending and clinical supply, et cetera. But can you give us some brackets to kind of where you are on toward profitability and sustainability? Because it sounds like the clinical spend is now getting a lot more manageable and sort of predictable. We only have essentially one big study and one small study ongoing. Thank you.
Nick Leshley
uh you're wrong this is uh excellent questions um on that so let's let me kick that over to steve because i think those are an important set of questions to make sure we understand kind of the triplet and the expectations thereof so steve one of you want to cover off on that and we'll jump to tip after yeah sure no that is an excellent question so let me let me reply in in to make two points in that regard the first point is that the
Jen
standard of care arm in the randomization was a choice of five approved combination therapies, and the investigators chose which combination therapy that they would use if patients were randomized to that arm, and it's a regimen that they could not have had before so that it increases the potential likelihood of benefit. In terms of your question, what would be expected, I think that is an important question because these patients are, one, have been refractory to their last line of therapy, which means that they have progressed within 90 days of their last line of therapy. And second, as you alluded to, they were triple exposed. And if you look in the literature and across the studies, There's not an awful lot of large databases on the outcome of patients who are triple exposed, but the totality of the data suggests that if you fail daratumumab, your overall response and your performance status both were extremely poor. So we had some ideas of what this might look like and really built our study upon that. But what we were very encouraged was in this study that abecma really had a statistically significant and what we believe is a clinically significant improvement over the poor response rate and poor performance status seen in patients who had failed daratumumab.
ABECMA
Thanks, Jerome. Good questions.
Nick Leshley
Sorry, we forgot to skip over to Chip here. Let him out of jail. Chip?
Nick
Thanks for that, Nick. Yeah, so you're on. Good question. Yeah, in terms of how to think about the abacus span, you're right on the non-commercial side. Those op-ex related to the clinical studies are in a more predictable range. For the existing studies, we would predict that that glide path continues, although I would refer you to the quote in today's press release that, you know, I think we are thinking together at BMS about future investments in Vecna, and you'll hear more from us on that throughout the second half of this year as those plans develop. But these data today, I think, give us increasing conviction in the long-term role of Vecna in the treatment of myeloma. And then on the path to sustainability, profitability, I think what you're seeing in this quarter's results is increased investment on the manufacturing side. And I think our priority is getting to all of the patients that we can, making those investments to make those ramps in terms of monthly and quarterly capacity. And that is going to have an impact in the short term, as you're hearing from us today, in terms of that path to profitability. But we think that tradeoff is justified, given the patients who continue to queue and wait for this therapy. So, You know, longer term, as we head into 23 and beyond, we think that picture is attractive and it's an attractive commercial business. But in the short term, we're making the right investments to maximize the impact on potential.
Nick Leshley
And your own, thanks, Chip. And your own, I mean, you and I have talked about this a couple times, but I think as you zoom back out, right, there are a lot of questions around the myeloma market opportunity for a CAR-T product, right? And I think that's been dispelled, right? The interest is there. then there's sort of where does a BACMA fit relative to sell to sell, and is there room for both, et cetera, et cetera. I think that also is becoming quite clear in our opinion, saying there is ample room here to sort of service an unfortunately big market opportunity with these patients who are just desperate for help. And now as we start thinking about earlier lines, I think we have that growing conviction and excitement. So Pretty much on every turn that we've taken, I'm getting more excited, but you're absolutely right. It's still bouncy, a lot less bouncy than it was six, 12 months ago. Still a little bouncy right now, as far as the execution side and build a level that off. But as we get into 23 here, we feel a high degree of confidence along with BMS and that we're very pleased with BMS and they are paying attention. Uh, frankly, like, uh, couldn't possibly imagine a better partner in this regard. And I think they're certainly very committed to the cell therapy space in that regard. So hopefully your own that helps.
ABECMA
Terrific. Thank you.
spk06
All right.
Operator
So for your next question, it comes from the line of Matthew Harrison from Morgan Stanley. Your line is now open. Please ask your question.
Matthew Harrison
Hi. This is from Matthew. So thanks for taking our questions. So maybe just one follow-up question on the KAMA3 interim analysis. I'm just wondering whether you can comment on, because you mentioned this is a planned interim analysis. So I'm just wondering whether you can comment on how many interim analysis you have planned in total for the PFS. And then my second question is on the 369 and the Direct 33 programs. You mentioned that you will have a data readout for these two programs later this year. So can you discuss what kind of safety data we could get for this year for these two programs? Thanks.
Nick Leshley
Yeah, I'll pass that off to Steve. I don't think we've outlined the specifics of the statistical plan here, but Steve, do you want to comment on that? And then I can take the high level 369, Derek, question.
Jen
Yeah, I mean, this was the, this was our first interim analysis for superiority. Yeah.
Matthew Harrison
Yes, so I'm just wondering whether, sorry. Sorry, I mean, just like whether you will have any additional internal analysis, or this will be the only one, like analysis on PFS, and then you'll have other internal analysis on OS?
Jen
Well, we're following for OS, and we're planning on presenting, you know, all of the data, hopefully at a meeting later this year.
Matthew Harrison
Okay, thank you. Yeah, so just to be clear, right?
Jen
So just... Just to be clear, if I'm getting you right, though, we met our primary endpoint, right?
Nick Leshley
Yes. Yeah. So that's the key bit, right? Primary endpoint was met. It was met early. And that's something we're excited about just because we were not anticipating this because you expect the full length of the study, right? So we were excited to certainly see that. On the 369-Derek-33, right, that obviously depends on enrollment. as we go towards the end of this year and the beginning of next. And I think we've consistently said first half of next year is when you can start seeing more substantive data. But in beginning, it's sort of safety, right? How are we looking at getting into these patients? And then you start seeing how hopefully the impact that it has. But a lot of this and the timing of this is something we're looking at very much depends on sort of how the dosing goes and how the safety goes, et cetera. But beyond that, that should be a rough expectation at the end of this year and sort of first half of next to get first good visibility into both those programs. okay thank you you're welcome operator next question there are no further questions at this time i would like to turn the conference back to nick lashley for closing remarks just want to thank everybody and apologies for the quick turnaround on this so appreciate you guys making the time and effort to jump on a call with us here if anyone has additional questions or or any uh things they'd like to dig more into please follow up with us directly get in touch with our investor group, and we're more than happy to follow up. Thank you, everybody, and have a great day.
Operator
This concludes today's conference call. Thank you for participating. You may now disconnect.
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