Xencor, Inc.

Good afternoon, and thank you for standing by. Welcome to Zencore's fourth quarter and year-end 2023 conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded at the company's request. Now, I would like to turn the call over to your speaker today, Charles Lyles, Head of Corporate Communications and Investor Relations. The floor is yours.

Thank you, and good afternoon. Earlier today, we issued a press release which outlines the topics we plan to discuss today. It's available at www.zencore.com. Providing comments on the call are Basil Dahiet, President and Chief Executive Officer, Nancy Valenti, Chief Development Officer, and Dane Leone, Senior Vice President, Corporate Strategy. After the prepared remarks and presentation, we will then open up the call for your questions, and we will then be joined by John Desjardins, Chief Scientific Officer, and John Cush, Chief Financial Officer. Slides that we are using today should be visible here on the webcast and will be made available for download on the events and presentations page of our website. Before we begin, I would like to remind you that during the course of the conference call, Zencore Management may make forward-looking statements, including statements regarding the company's future financial and operating results, future market conditions, plans and objectives of management, future operations, the company's partnering efforts, capital requirements, future product offerings, and research and development programs. These forward-looking statements are not historical facts, but rather are based on our current expectations and beliefs and are based on information currently available to us. The outcome of the events described in these forward-looking statements are subject to known and unknown risks, uncertainties, and other factors that could cause actual results to differ materially from the results anticipated by these forward-looking statements. including but not limited to those factors contained in the risk factors section of our most recently filed annual report on Form 10-K. With that, I'll pass the call over to Basil.

Thanks, Charles, and welcome, everyone. Today, we'll cover a few business highlights from 2023, briefly review our clinical pipeline, and provide a data update on Vudalimab and prostate cancer. You can refer to our press release for more information about the last quarter and full year. We focused our pipeline and discovery work on our T-cell engagers because of growing validation for their potential in solid tumors. Supporting this is the continued advance of Vidalimab in prostate cancer, where we'll provide an update today, and the start of a trial in frontline lung cancer for Vidalimab. And we've decided to reduce our investment in our cytokine drug candidates as part of this focusing. Our partnerships and licenses played a significant role for us last year, first with validating data for our XMAB 2 plus 1 CD3 platform from our partner Amgen with their xyloritmic data in prostate cancer, And two phase one programs started in our CD28 bispecific collaboration with J&J. And we significantly strengthened our balance sheet with a partial monetization of our Ultimers and Mondravy royalties. As a result of that and robust milestone in royalty revenues, we ended 2023 with $697 million and expect runway into 2027. Now on to our pipeline. The focus of our clinical pipeline is bispecific T-cell engagers for solid tumors, an area with rapidly growing promise. Solid tumors have been challenging for antibody and cell therapies, but recent data, some of which we'll review momentarily, suggests that CD3 and CD28 bispecifics could play a role as therapies in a range of solid tumors. Key programs for us addressing this opportunity are XMAB819, an ENPP3 by CD3 XMAB bispecific for renal cell carcinoma, and XMAB808, a B7H3 by CD28 XMAB bispecific in prostate and other cancers. Both are advancing in dose escalation in Phase 1, and right behind them is XMAB541, a Clouden 6 by CD3 bispecific that we expect to start Phase 1 the first half of this year. For Vudalamab, we initiated a new study, its first frontline study, in non-small cell lung cancer, based both on our Phase 1 data in lung cancer and external data suggesting potential advantages against standard checkpoint therapy in this setting. And we've made progress with our metastatic castration-resistant prostate cancer studies, both in combination with chemo and monotherapy. And with encouraging monotherapy data, we're going to present in a moment. Finally, we're wrapping up our Phase I work next quarter for both XMABS 564 and 662, taking the PK, PD, and safety data in hand to establish initial product profiles and monitoring the field for further validation of these cytokines before we do any additional developments. Underpinning our T-cell engages our XMAP bispecific technology. It lets us address the solid tumor opportunity by engineering our antibodies with a format and affinities designed to give tumor selectivity in the context of each tumor target's particular expression levels and tissue distributions. Solid tumor targets in particular need a customized approach because they're distributed more broadly than heme tumor targets, which have already been successfully addressed by CD3 bispecifics in lymphoma and myeloma. Our plug-and-play antibody modules let us do this work rapidly, and as a result, we've got a growing pipeline of molecules with our 2-plus-1 design, which is particularly helpful with selectivity for solid tumors. And here is the first clinical proof of concept for our XMAP 2-plus-1 CD3 format, xaloridimig, which targets steep 1. Our partner, Amgen, presented very promising efficacy and tolerability data at ESMO last October in late Lyme prostate cancer, usually considered a cold tumor for immunotherapy. This target was challenging due to the limited accessible binding regions outside the cell membrane and non-tumor expression. So we're very encouraged to see this early data for the molecule in a two plus one format. Amgen's announced they are nearing completion of the phase one study and are planning additional studies in earlier lines of therapy. So we'll be eagerly awaiting their updates. Now, our own lead XMAB2 plus 1 CD3 bispecific is XMAB819, targeting ENPP3 and renal cell carcinoma. We chose ENPP3 as a target because it has exactly the kind of expression profile we want for a CD3 solid tumor target. Much higher expression on tumor than normal tissues and nearly uniformly high expression on clear cell renal cell carcinoma. Plus, it has potential for use in select patients and a range of other tumors. Also, we think renal cell carcinoma has a need for new mechanisms beyond checkpoint inhibitors and TKIs, and a directly cytotoxic antibody could be well-positioned. 819's design gives us selectivity we wanted in vitro, and we're continuing to advance in dose escalation with both IV and subcutaneous dosing, and expect to make significant progress this year toward target dose levels. I'll shift now to XMAB808, our new T-cell engager mechanism, CD28-targeting. The goal here is to activate T cells via the signal 2 pathway, which powerfully amplifies and sustains T cell responses. We designed 808's bispecific format and affinities to try to drive this activation in a tumor-specific way by requiring sufficient binding to its tumor antigen, B7H3, to turn on CD28 signaling. A key part of our approach is a lower-potency CD28 binding domain that we think could give us control of CD28 signaling and improve tolerability. We picked B7H3 because it offers high expression across a range of tumor types, creating an opportunity to potentially treat multiple cancers in combination with either checkpoint inhibitors or CD3 bispecifics. CD28 targeting has generated a lot of interest among clinicians and across the industry, and the current phase one study in combination with pembrolizumab is progressing well in escalation. Now, our latest CD3 bispecific is set to enter the clinic imminently. XMAP541 targets CLOUDIN6, which is highly expressed, on the majority of ovarian cancers, and also on several other tumor types. Though it has a very promising expression profile, it is a selectivity design challenge because there are multiple closely homologous cloudins. We think we addressed it with careful Binding's main engineering and our 2 plus 1 format. XMAP 541's IND is open, and we expect to be in patients the first half of this year. We're planning to apply lessons learned for solid tumor CD3 dosing from both internal and external programs to move the study quickly. Now I'm going to turn it over to Nancy for the Vidalimab update.