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spk00: 2020 were $44.5 million compared to $29.8 million for the same period in 2019. Total R&D expenses for the nine months ended September 30, 2020 were $121.9 million compared to $91.3 million for the same period in 2019. Additional spending on R&D for the third quarter and first nine months of 2020 over months for the same period in 2019 is primarily due to increased spending on our clinical programs, including Plumomidumab XMAP 2717, and our IL-2 FC cytokine development program, XMAP 27564. General administrative expenses for the third quarter ended September 30, 2020, were $7.6 million compared to $6.3 million in the same period in 2019. Total G&A expenses for the nine months ended September 30, 2020, were $22.1 million compared to $17.5 million for the same period in 2019. Additional spending on G&A for the third quarter and the first nine months of 2020 over amounts for the same periods in 2019 is primarily due to increased compensation costs related to additional general administrative staffing and spending on intellectual property, including patents and licensing costs. Non-cash stock-based compensation expense for the nine months ended September 30, 2020 was $23.1 million compared to $24.7 million for the same period in 2019. Net loss for the third quarter ended September 30, 2020 was $12.6 million, or $0.22 on a fully diluted per share basis, compared to net loss of $10.2 million, or $0.18 on a fully diluted per share basis, for the same period in 2019. The higher net loss reported for the third quarter of 2020 compared to the same period in 2019 is primarily due to increased IRD spending over increased revenue earned during the period. For the nine months ended September 30, 2020, net loss was $55.6 million, or $0.97 on a fully diluted per share basis, compared to net income of $53.8 million, or $0.92 on a fully diluted per share basis for the same period in 2019. The net loss report for the nine months ended September 30, 2020, compared to net income report for the same period in 2019, is primarily due to higher collaboration licensing revenue reported in 2019 compared to 2020, and increased spending on R&D programs in 2020 over 2019 amounts. The total shares outstanding were 57.4 million as September 30, 2020, compared to 56.7 million as September 30, 2019. Based on current operating plans, projected spending, and expected proceeds from our partnerships and collaborations, We expect to have cash to fund research and development programs and operations into 2024 and to end 2020 with between $525 and $575 million in cash, cash equivalents, and marketable securities. With that, we would now like to open up the call for your questions. Operator?
spk10: As a reminder, to ask a question, you will need to press star 1 on your telephone. To withdraw your question, press the pound key. Please stand by while we compile the Q&A roster. One moment. And our first question comes from Ted Tentoff of Piper Sandler. Please proceed.
spk07: Hey, thanks so much, guys, and a nice update. I wanted to ask with respect to 14.045, your CD123 for AMLs. I definitely was intrigued to see the clean safety and some responses there. Maybe you can go into a little bit more detail in terms of what next steps might be and then sort of potentially use that in combination with other agents. Thanks.
spk01: Thanks, Ted. I'll just state at the outset, of course, we have some restrictions because of our ongoing partnership with Novartis around 14.045 about how much we can say. I don't know, Alan, do you want to comment on the population?
spk03: Yeah, I have to be cautious here, but, you know, it was kind of an interesting scientific observation that we found more activity in patients with a lower burden of disease, and there are specific populations in people with myeloid malignancies that will have lower burdens of disease that I'm sorry I can't say more at this time, but, you know, I think it's fairly obvious where you could go with this.
spk01: Yeah, and regarding combination agents, I think, you know, we did observe also that correlation of response to people who express certain T cell markers. So we would potentially explore that as well. But, you know, the next step is as Novartis and Zencore advance along the timeline to getting the next set of groups of patients enrolled, we'll be able to disclose things more fully.
spk07: Thank you so much for the update. Thanks, Ted. Thanks.
spk10: Thank you. Our next question comes from Peter Lawson of Barclays. Please proceed.
spk14: Hi, everyone. This is Mitchell Long for Peter, and thank you for taking our questions. For Vibocodumab, I can appreciate how you can't say so much about positioning, but could you talk about maybe the bar for AML in this population and how you see that, and then maybe your view on peer CD123, CD3 data in this space?
spk01: Yeah, without commenting too much on peer data, I think that, you know, the populations that are possible with this agent, if we focus on low leukemic burden, there's a variety of different bars depending on the specific subpopulation. So it's hard to give you an answer to that, but we do have good ideas about what the bar is without also disclosing, unfortunately, things we can't disclose.
spk14: Okay, and then I think you've mentioned potential other indications that the asset could go into. Do you have any ideas of where you might be able to take it beyond the low-burden AML?
spk01: I would say it's low-burden myeloid diseases in general, that they're pretty broad expressors of CD123, things from myeloid lineages, and there's a variety of myeloid malignancies. Beyond, in addition to ML. Great. Thanks so much.
spk10: Thank you. Our next question comes from Gregory Renza of RBC Capital Markets. Please proceed.
spk13: Hi, guys. This is Ian Longford, Gregg. I also have a question on levacodamide. I was just wondering, in light of the recent publication on another CD3, CD123, by specific, that demonstrated association between P53 mutations and complete response in AML, just wondering what your thoughts are on the research there, and have you explored or plan to explore the potential in subpopulations of AML patients with specific mutations? Thank you.
spk01: Yeah, I don't think specific mutations are how we orient this molecule. CD123 is a PAN marker in various myeloid malignancies, and so we think of it from a sort of a broader use perspective, focusing now on where we see lower disease burden. You know, so I don't think there's too much read-through from there. Did that answer your question?
spk13: Yeah, yeah, they did. Thanks. And I have another one, if I may. Just wondering what's your level of confidence in the tolerability of 2717 based on the data so far, and how do you think the design of the molecule contribute to its differentiation from other PD-1cpLA4 bispecific or combination therapy?
spk01: Yeah, I'll comment on the design, and then, Alan, maybe you should jump in and talk about our tolerability observations. So the design of the molecule was so that to take advantage of its biospecific structure, it allowed us to design a molecule that requires cooperative binding in order to have strong binding, cooperative binding to both PD-1 and CTLA-4. So there's only one PD-1 binding domain, only one CTLA-4 binding domain. They have fairly modest affinity, so if there's only one target or the other on the cell, they're not going to stick too well, which means they don't have a terribly high affinity to cells that have low expression of one or the other of the markers. You have to have both. If you have both markers, you get nice, avid binding. You have, like, both arms able to grab on and, you know, pull yourself onto the cell. So that was so we would focus the molecule's activity at de-repressing these checkpoints on specific subpopulations that are typically more overrepresented in tumor microenvironments. That's the double positive checkpoint cells. So that's the distinction of the design, and the hope there was to activate the cells that matter for better tolerability and efficacy profile. So that's the essence of the design, and I think that's distinct from, certainly from a combination therapy of two different antibodies, but it's also distinct from most of the PD-1-CHLA-4 bispecific antibodies that are in early clinical development alongside 2717. Now, Al, maybe you want to touch on the tolerability and the sort of nature of AEs that we see.
spk03: Yeah, we're very pleased with the tolerability profile to date. You know, as Basil alluded to the design, it's hard to sort of demonstrate differences in safety in a clinical study, especially a phase one clinical study from sort of predecessor molecules. But with that said, there seems to be a suggestion that the AE profile is slightly different. We're seeing a lot of rash. We don't tend to see colitis. You know, the way this study was designed, 10 milligrams per kilogram was our sort of top dose, and we didn't hit an MTD. So we're continuing to dose escalate now at 15 milligrams per kilogram to see if we can dose higher. And, you know, the idea is if you have better tolerability, you could possibly dose higher and then get more efficacy. But, you know, we still have to sort of see what the maximum tolerated dose is. In addition, you know, in the abstract, there was a grade 5 and a grade 4 event, and I can add some color to that. You know, the patient with the grade 5 pancreatitis did have pancreatic involvement and metastases, and the one with the grade 4 myocarditis had a non-small cell lung cancer that involved the myocardium. So, you know, that is sort of something that's in the abstract, but I think this helps to understand the AE profile, and we're actually very pleased with the data so far.
spk13: Got it. Thank you very much.
spk01: Thank you.
spk10: Thank you. Our next question comes from Jonathan Chang of SVB Lerant. Please proceed.
spk09: Hi, guys. Thanks for taking my questions. First question, can you provide any more color on the planned promoter lab monotherapy and combination studies in DLBCL?
spk01: At this time, all we're really able to say is that there are Phase II studies that were, you know, both in relapsed refractory DLBCL. They'll be looking at specific groups of patients or defined populations within there, but more details will be forthcoming. I think that the strategy, though, has always been that the broad use of a CD20, CD3 is going to depend on the strategy you have for how you combine it with other agents because there's so many agents of different MOAs that work in non-Hodgkin lymphoma, you know, that what we've seen for the last 20 years with the success of Vertux and chemo is that combining them in the right way gives you the best outcomes. And I think we're going to have a whole new generation of these combination regimens to choose from going forward. But a monotherapy in this setting could give you rapid acquisition of data and a much faster-to-market strategy sort of to try to have both prongs going. As I said, we'll have more details forthcoming as the final operational plans and and nuances lock into place.
spk09: Got it. Thank you. And just second question, still on Plumotumab. When could we see updated data from that program?
spk01: We will be presenting updated data next year, and we'll give specifics on the exact timing of that as we get a little closer to the data disclosures.
spk09: Got it. Thank you very much.
spk10: Thank you. Our next question comes from Tom Schrader of BTIT. Please proceed.
spk11: Hi, this is Kareri for Tom. Thanks for taking our questions. For autoimmune disorders, I believe two different approaches are being evaluated in the clinic. One is to suppress auto-CD8 or effector T cells, and the other, like yours, which is to stimulate or accurate Tregs. Can you tell us what are the advantages and what type of autoimmune disorders make sense for your approach?
spk01: Yeah, I think that it is a bit, it's sort of suggesting too much to think that anybody really understands the specific cellular etiology and drivers of any particular autoimmune disease. I recall not too many years ago, MS was considered a T-cell-driven disease, and RA was considered a B-cell antibody-driven disease. And yet, of course, you see highly effective MS treatments from B-cell targeting therapies like Acrevis, and you see highly effective therapies when you look at T-cell blocking therapies in RA like Orencia. So I think simple descriptions of what drives a disease makes it hard to decide a priori what a particular agent or particular mechanism of action, which specific disease types it might benefit. So, you know, I think that that means that we have to look at the factors like population, unmet need, the preclinical models that will help us pick the indications for our autoimmune IL-2 program. But I'm not a big believer that there's detailed enough mechanistic understandings of most, the vast majority of autoimmune diseases to really dial yourself in like that.
spk11: Right, yeah, that makes sense. And just the last one for me. With all the engineering going around the IL-2 molecules to avoid CD25 binding, which seems to prevent Treg activation and vascular leak syndrome, at least preclinically, how is the IL-15 approach different from these novel attenuated IL-2 molecules?
spk01: So IL-15, and this is for our oncology program, our XMAP 24306, currently in phase one studies with Genentech, our partner, IL-15 doesn't bind the CD25 or IL-2 alpha receptor. It just doesn't, right? So I think that that's a critical feature that you might be able to tune away IL-2 alpha receptor binding or eliminate it by pegylating in the right spot. Il-15 starts out at that as baseline. And so that's, we believe, just an inherent benefit and a risk reducer. The other factor is the potency reduction we do is dependent on, or rather was selected to have really the minimal amount of potency you could have and still activate the cells. And so I can't comment on the exact degree of how people attenuated the potency of their molecules, but we think having a single defined composition of matter that has a specifically well-known potency is an advantage over, say, mixtures of differing potencies or kinetically variable potencies based on some chemical reaction around the molecule. And having it attached to our FC domains with our Xtend technology on it to sort of smooth out those bumps, I think, is also a benefit. And we'll see how that all plays out in the humans in our 24306 program.
spk11: That's helpful. Thank you.
spk10: Thank you. Our next question comes from at Sir Daru of Guggenheim Securities. Please proceed.
spk04: Great. Thanks for taking questions, and congrats on the updates here and the progress. Just a couple for me. So first, just went back to, you know, clinical trials to remind myself of the other two checkpoints, T and E by specifics. And just sort of given, you know, sort of we've been dealing with COVID for the better part of the year, just wondering about the progress of these programs and in phase one and what we could expect to see clinical data from those two assets.
spk01: Right. We like to guide on when we're going to have clinical data, when we're pretty close to getting those disclosures going. Note, those two programs started about a year after our 20717 program, which we just had our first data disclosures over the last few months. So they're about a year less mature, having been in the clinic now for something like 15 or 16 months each. I can't say until we get closer and have more definitive information to tell you when we would update those programs. But they are both actively enrolling. They have not had, either of them, any meaningful impacts from COVID. You know, dose escalation, and they both have dose escalation and expansion cohorts baked into them that we should be able to talk to people about, you know, in due course, and hopefully not that long. But we can't give any specific guidance right now.
spk04: Yeah, no, that's helpful. That's helpful. Thank you. And second question, just wondered, you know, I guess to the extent that you can speak to this, any major differences in patient characteristics that you can speak to in the upcoming Vibacodamab data relative to sort of the previously reported data back in FADASH 2018?
spk01: I guess within the bounds of the abstract, I don't know, Alan, if there's much we can say about the different I'm assuming you're asking about demographics, Ed, sir. Yeah. Yeah. Go ahead, Al.
spk03: There haven't been any significant change to the inclusion-exclusion criteria. So, you know, in terms of population shifts of the total patients enrolled, there's probably not going to be changes.
spk01: Yeah. So it wouldn't reflect our insights around the kinds of patients and the lower disease burden that were better likelihood of response. It would not reflect that.
spk04: Great. Awesome. Well, I can always follow up as well after the presentation, but thank you. Thank you.
spk10: Thank you. Our next question comes from Gabriel Fung of Mizuho Securities. Please proceed.
spk02: Hi there. This is Gabriel. I'm from Mayor Goldstein. Just a question here on the R15-243-06 candidate. How are you thinking about planning How are you thinking about the planning of expansion studies moving forward? Would these be more of combinations with portfolio products or leaning more towards established external candidates? And does the agreement with Genentech have any restrictions on which targets either party can explore?
spk01: I'll take that one. So, in terms of timing, of course, you have to establish safety and dose, you know, schedule with the agent before we can kick off other combinations. We would look at not just our own internal candidates, but also third-party molecules, some of which have been predefined in the contract that we're planning on doing combination studies with, some of which we can just, you know, propose and initiate. There are some restrictions around, of course, creating problematic safety signals and things like that. Those are sort of, you know, part of the course for combination studies. But also we cannot and we would not want to have the same exact mechanisms of action compete with each other within the sort of overall study approaches, right? So it'll be fairly broad and we know Genentech has a pretty broad view beyond just in the phase one doing that initial combination with the tezolizumab, which is something that's been disclosed.
spk02: Right. Good. And also just one extra quick question on your comment on vibocodumab earlier when you discussed that you see more rash than colitis. Could you provide more color as to your discussions with the physicians on the trial as to how meaningful this difference is and if maybe a physician would prefer a rash over a colitis events for the drug?
spk01: Alan, you want to take that without obviously speaking for all the doctors and oncologists in America?
spk03: Yeah. So, you know, again, just to clarify, it wasn't for vivacodamab. It was for XMAB2717RPD1CTLA4. And, you know, I think it's still early in the development to say that, you know, we're going to sort of distinguish it based on its safety profile. But I think it does suggest differences in the design of the molecule. It's doing the things that we're hoping it's doing. So at this stage, I'm optimistic. but I'm not going to go and say that people are going to use or prescribe differently based on the profile. That's always been challenging in oncology because when you talk to oncologists, it's always about efficacy.
spk02: Got it. Thank you very much. Sure.
spk10: Thank you. Our next question comes from Arlinda Lee of Canaccord. Please proceed.
spk12: Hi. Thanks for taking my questions. I had questions about your dose escalations for 14.045 and vibocodamab. So neither of these you've reached an MTB. And I'm wondering if you're still with dose exploring what you're looking for to decide in a go-forward dose. And then on 14.045, do you think that going into... a lower burden myeloid malignancy would have the same dose. And I'm curious on the better efficacy that you're seeing. Are you also seeing lower CRS? Thank you.
spk01: So there's several layers of questions there. Maybe to start with the first, and I, you, so you're talking about one program here, vibocodamab, right?
spk12: And the 2717, well, mainly the Vibocodamab, but also 2717, you haven't.
spk01: Okay, so now I can multiply all that by two. Hold on a sec. Let me just make a note. So I think the places we're still nailing down the details around dosing regimen for 14.045 are around exactly the schedule of priming doses to give. So that's that piece. That's always the last bits of details. And You know, it's fair to say that the restrictions around dose changing and escalation within a patient that we had put on us by the FDA coming off the clinical hold just definitely make that a little slower of a process. So that's fair to say that that made it definitely more difficult. So you then asked the question about lower burden disease having necessarily the same or a different dose. Alan, you might want to take that, I guess, you would expect more flexibility around the tolerability of the agent with lower disease burden, though.
spk03: Yeah, it's a great question, Erlinda. And, you know, it's really around not so much the dose, but, you know, remember, we're giving ours intermittent dosing. So, you know, every other day or weekly. And, you know, it's the schedule and how quickly you can escalate. Because we know that you can give fairly high doses that can be tolerated at but they have to be sort of primed and you have to sort of move up to that dose. And so it's really a balancing act of how quickly do you want the dose to go up and how high do you need it to go up to get the efficacy that you want to see. And, you know, I think there's a little bit of work that still needs to be done there. Clearly, if you have lower burdens of disease, you may need a different dose or schedule, but I don't think we have that completely figured out yet.
spk01: And then it's lower CRS with lower burden disease. I don't know that we have enough data to even comment on that, though nothing jumps out.
spk03: Yeah, we are watching that. I will say from the history of bispecifics, that has been sort of demonstrated. You know, clearly with Blinzido, the higher leukemic burden has more CRS, et cetera. So it's something that we would expect to see, and we will keep an eye out for that.
spk01: Yeah, now for 717, because we saw activity at 10 mg per kg, we did expand there, and it's a tolerable dose, and we're exploring higher, but we're not letting exploring higher doses hold us back from really pushing forward with 10 mg per kg and then maybe adjusting later if higher is really well tolerated and suggests it might give us an incremental bit of activity. But we are confident that 10 mg per kg is an active dose.
spk12: Okay, great.
spk10: Thank you. Thank you. Our next question comes from Zixu of Barenburg. Please proceed.
spk08: Thanks very much. Congrats on the progress. A few questions here. In your prepared remarks, you mentioned about the strategy for companies to decide which program to move forward, which program to terminate. I guess at the current state of all the assets, which ones would you say that you would definitely move forward?
spk01: Well, they're all moving forward right now to get that key proof of concept data that gives you that ability to make the decision. And that's essentially where most of our programs stand. I think our Plamodimab and 20717 programs are at that point where the proof-of-concept data is emerging as we observe. It doesn't all happen at once in these open-label oncology trials. Data emerges and rolls out and gives you the directions to take. So we're in the midst of that decision process for how to advance Plamo and 2717, and we're actually optimistic about both. I think we feel pretty confident that both are going to continue advancing. For the others, we await data, and we'll have the thumbs-up, thumbs-down on those as data emerges.
spk08: Okay, great. And then for IL-12 and IL-15, I understand both are for oncology. Based on, I guess, preclinical or translational data, do you see the difference in terms of which indications for either program?
spk01: You know, not really. I think that they both have a broad activity at improving T cell function and number I don't think there's anywhere near the granularity of data you would want to look at indication based on their specific mechanisms.
spk08: Okay, understood. And finally, for the IL-2 program for autoimmune disease, I understand that you mentioned eventually probably this will be partnered out as, you know, as companies focus on oncology. When do you think will be a good time for the company to start looking? Do you want to get the Phase 1 data ready, or are you looking for parties outside right now?
spk01: You know, I would actually park the idea that we're definitely going to partner the IL-2 program. I think it really comes down to the indication strategy itself. that we select that we're right now pulling all the pieces together on that we would implement immediately after we come out of our healthy volunteers dose escalation, which we hope happens very quickly, because that's the beauty of healthy volunteers studies in these autoimmune indications, just to get your mechanism of action, your pharmacodynamics, your PK nailed down. that indication strategy is going to drive whether we want to keep the asset for the long haul or partner it. I think that we have to be realistic that sometimes in autoimmune disease, partnering is what you need to do. But I don't want to make that a predicate if that's what we're definitely going to do with that program. We'll be able to give more color on that as we can start publicly disclosing our strategy.
spk08: Got it. Thank you very much.
spk10: Thank you. I would now like to turn the call back to Basil Dihayat for closing remarks.
spk01: Thank you very much, Operator, and thank you, everybody, for joining us today. Take care of yourselves. Have a great evening. We look forward to updating you again over the coming weeks.
spk10: Ladies and gentlemen, this concludes today's conference call. Thank you for participating, and you may now disconnect. Thank you. Music playing Thank you. Thank you. Bye. you
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