Arcus Biosciences, Inc.

Hello everyone. Thank you for joining us and welcome to the ARCIS second quarter 2026 earnings call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. I will now hand the conference over to Pia Eaves, Vice President of Investor Relations. Pia, please go ahead.

Good afternoon and thank you for joining us on today's conference call to discuss ARCISO's second quarter 2026 financial results and pipeline updates. I'd like to remind you that on this call, management will make forward-looking statements, including statements about our development strategies and our expectations regarding the advantages and opportunities afforded by our investigational products, our clinical development milestones and timelines, our projected cash runway, and our financial outlook. All statements other than historical facts reflect the current beliefs and expectations of management and involve risks and uncertainties that may cause our actual results to differ from those expressed. Those risks and uncertainties are described in our most recent quarterly report on Form 10-Q that has been filed with the SEC. For today's call, please refer to our latest corporate presentation posted in the Investors section of our website. This afternoon, you'll hear from our CEO, Terry Rosen, CMO Richard Marcus, President Juan Jaen, and CFO Bob Goeltz. With that, I'll turn the call over to Terry.

Thanks very much, Pia, and thanks so much everyone for joining us this afternoon. We continue to make substantial progress in advancing our portfolio of oncology and immunology programs. Execution throughout the first half of the year has been tremendous, and this tangible productivity will be a focus of today's discussion. Our highest priority, no surprise, continues to be the advancement of Castatafan, which we believe has clear potential to be a $5 to $10 billion drug. The remainder of our pipeline has also been advancing quite well, and we're beginning to share the details and breadth of our other programs. These create a steady and sustainable stream of additional opportunities, as well as strategic optionality. So starting with Castatafan, our next generation HIF-2-alpha inhibitor. The advancement of CAS has driven an inflection in value for ARCIS, and we expect further data this year to accelerate this inflection. Our first Phase III trial, Peak 1, evaluating CAS plus cabozantinib, the gold standard of Karen's second-line Clear Cell RCC, has tremendous investigator enthusiasm, and we remain on track to complete enrollment by the end of this year. Last year, we presented a wealth of data that demonstrated clearly Cas-DataFan's efficacy advantages over Belzudafan. Over the next six months, we will share new data that will provide clear line of sight to Cas-DataFan's full market potential. Based upon Cas-DataFan's superior profile, as well as our development strategy, we expect Cas to become the backbone therapy for all patients in all lines of treatment and Clear Cell RCC, and we're maximizing that opportunity by rapidly expanding our development program. With the recent failure of Merck's LightSpark 012 study, Cas now has no competition in the frontline space, and our development plan, already ongoing, creates a clear path for Cas to consolidate what's currently fragmented frontline market as the first and only HIF-2-alpha inhibitor in this setting. We're leveraging our platform study ARC20 in addition to collaboration studies to support the key combination regimens we'll pursue for first-line treatments. We had our meeting with the FDA to discuss our first front-line phase three study in the setting, we're calling that PEEP20, and we remain on track to start this registrational trial by the end of 2026. Across the development program, castatopan is being evaluated in several different combinations across all lines of therapy. We're doing this in both a capital and resource-efficient manner by securing partnerships, more specifically clinical collaborations, and these all allow us to retain the full rights to the Cas-DataFan program. We believe that we are the partner of choice for collaborations involving a HIF-2-alpha inhibitor. This is enabling investigation of the smartest mechanistic combinations and settings. Keep in mind, Belzodafan is readily available to anyone. We do not believe it's an accident that others want to combine with Cas-Statafan. We initiated multiple new clinical trial collaborations in the last two months. In June, we announced a collaboration with BMS to evaluate Cas in combination with Pumida, their bispecific anti-PD-L1 VEGF antibody in the first line setting. In July, we announced a collaboration with Summit Therapeutics to evaluate Cas in combination with Ivo, their bispecific anti-PDX1 VEGF antibody. ARCIS will be conducting this study in a first-line cohort as part of ARC20. This is the second of three collaborations we've executed to evaluate Cas with an anti-PDX VEGF bispecific in the first line. So just to emphasize, We have three collaborations with anti-PDX VEGF antibodies. In addition, in July, we also announced the collaboration with Aveo, in which we'll be combining Cas with TiVo in advanced Belzutifan-experienced patients. This study will also enable our planned late-line registrational study that will evaluate Cas TiVo in both HIF-2 inhibitor-experienced as well as HIF-2 inhibitor-naive patients. So now let me spend a few minutes describing our holistic development strategy for CasDataFan. Let me emphasize an important point in introducing this topic. While we believe that CasDataFan will completely transform the Clear Cell RCC treatment paradigm, our strategy is totally consistent with the current treatment paradigm. We're simply creating a framework that will provide HIF-2-alpha inhibitor enhanced options that only CasDataFan with its unique profile can offer, basically adding on top of the best current regimens that are favored by both physicians and patients. So in the first line, we plan to develop multiple options that will make Cas the foundational medicine regardless of the selected combination partner. Our strategy is designed to provide flexibility to physicians with a HIF-2-alpha inhibitor enhanced regimen corresponding to their preferred treatment approach and many more patients. With Belzodafan's recent frontline setback, Castatafan has a clear path to become the common denominator in what's currently a fragmented frontline setting as the first hip 2 alpha inhibitor available to these patients. A Castatafan based TKI sparing IO-IO regimen is the bedrock of our first line strategy. It's intended to address the key limitation of ap plus nevo which is an approximately 20% rate of primary progression. Currently, ipinevo represents the most commonly used frontline regimen with a market share of about 30% and we believe CAST has the potential to increase that to 50% or more. We also plan to develop a CAST-based TKI-inclusive first-line regimen for that segment of physicians who are always going to prefer to reach for TKI. especially for patients with fast-growing bulky tumors. Our partner TKI in the setting will be ExitNet, well-established as an effective frontline TKI, and very importantly, aligning well with subsequent regimens including CAVO and TEVO over the long-term treatment strategy. You have to remember that when making prescribing decisions, physicians are considering how they will sequence multiple TKIs to potentially give patients 10 or more years of survival. So combination choices are not selected in a vacuum. Lastly, in the first line, as I mentioned earlier, we're leveraging our partnerships, including with BMS and Summit, to evaluate Cas-Stat event in combination with three different novel anti-PDX VEGF antibodies. We believe anti-PDX VEGF bispecifics may play an increasingly important role in the treatment of kidney cancer going forward. Both the PD-1 and VEGF pathways are factors in disease progression, and there's strong biologic rationale for pairing them with a hard-hitting HIF-2-alpha inhibitor like castazepam to deliver both an early treatment effect and sustained tumor suppression. The rationale for this class of bispecifics to have utility in Clear Cell RCC is as strong as in any setting. And the combination could provide a TKI sparing regimen that still incorporates the essential biology of the TKI, but without the baggage that's associated with the poor selectivity of the TKI class. In the second line, Cas plus Cabo is intended to build on the current second line standard of care. This combination is now in registrational testing with our phase three peak one trial. Cabo is the most commonly prescribed TKI monotherapy in the setting. It's the TKI that physicians prefer and have greatest experience in managing AEs with the recognition of a better toxicity profile relative to that of the Belzutifan combination partner also sold by Merck, Lenvapnid. Lenva's toxicity profile is well documented with greater rates of cardiovascular toxicities. In LightSpark 011, all grade cardiac dysfunction was 7% for Bell's-Lenva versus just 1% for Cabo. Grade 3 or higher cardiac dysfunction was 5% for Bell's-Lenva versus .5% for Cabo. That's a big deal. That's a tenfold difference. Keep in mind, these data are a direct comparison from a randomized study. With CAST's superior efficacy profile versus Bell's and Cabo's tolerability advantages versus Lenva, we expect CAST plus Cabo to be the preferred HIF-2-alpha combination in the second line based on both efficacy and safety. Finally, with the announcement of our collaboration with Aveo, we're developing CAST Datafan plus TiVo in second line plus Clear Cell RCC. including in Belzodifan-experienced patients. As I mentioned, this will precede a registrational trial of both HIF-2-alpha inhibitor experience and naive patients. In an upcoming investor event in October, we'll be sharing key ARC-20 data readouts for Castatafan. These will be in the first, in the second, and late-line settings. These data will provide a holistic picture that will demonstrate the potential for CAST to benefit patients across the treatment paradigm. This will be a large and comprehensive data set, including data from over 200 patients. Richard will go into more detail on the specific readouts, but I'd like to take a moment to provide some scientific context and a framework for thinking about patient outcomes with CAST Datapan in the various settings. In this context, in parallel to executing on our holistic development strategy for CAST, we've been committed to the advancement of the highest quality research in the HIF-2-alpha space, particularly on translational studies that have a direct impact on the development program. I want to emphasize that this work, a hallmark of the CAST DataFan program on all fronts, is not esoteric, but in fact provides the basis for the quality and profile of the molecule as well as the foundation for our development strategy. Our initial work on castafen HIF-2 alpha biology was published recently in Nature last month. The manuscript describes exceptional scientific research carried out across our drug discovery, bioinformatics, translational, and clinical teams, and includes a number of our clinical collaborators from the academic community. This is the first study to comprehensively connect clinical outcomes from patients receiving a HIF-2-alpha inhibitor with peripheral biomarker changes and associated tumor biology. The research showed that HIF-2-alpha inhibition with Casdatafan monotherapy in clear cell RCC patients resulted in deep and sustained suppression of erythropoietin and that the depth of that suppression correlated with higher response rates and longer progression-free survival. Suppression of erythropoietin or EPO production is good. It correlates with positive outcomes. This is just one example of the strides our research team has made towards developing a thorough understanding of hip 2 alpha biology and its linkage to patient outcomes in kidney cancer. Okay, now the important piece, thinking prospectively. We've also been investigating how exposure to prior therapies may impact clinical outcomes. For example, let me tie this all together. For example, it's known that, not surprisingly, prior TKI exposure in RCC leads to poorer outcomes for patients who are treated with a TKI in subsequent lines of therapy. So therefore, patients who receive a TKI in the first line are currently underserved by the most commonly prescribed TKI monotherapies in the second line and beyond. At the same time, however, TKI exposure has been shown to result in an upregulation of HIF-2-alpha activity. We've illustrated this on slide 31 of our corporate deck. So let me repeat that. Greater TKI exposure has been shown to result in upregulation of HIF-2-alpha activity. One point I'd like to link back to now. In our Nature paper, we elucidated that high HIF-2-alpha activity is correlated with improved PFS in patients treated with castatafan. However, interestingly, subgroup patient analyses reported by Merck showed that patients treated with belazodifan in LightSpark-005 or LightSpark-013 had an inverse correlation of efficacy outcome with a number of prior TKI therapies. That is, more prior TKI therapies led to worse outcomes with Belzodifan. By contrast, what I can tell you is that in our analyses of our late-line Castatafan monotherapy cohort, that's 120 patients, we do not show this inverse correlation. We therefore believe that more robust and, in fact, more durable HIF-2-alpha inhibition with CasDafan may provide better outcomes for patients with prior TKI exposure. And this will be one of the parameters that we analyze across our data sets. And we'll be speaking more about our analysis on this topic at the investor event in the fall. A little bit of a transition now. Our commitment to research has been at the core of the company since our founding. and despite relatively minimal capital investment, our parallel work in immunology has enabled us to build a rich portfolio of programs. Perhaps one of the broadest and deepest earlier portfolios of high quality molecules in the industry. These programs were all created in-house over the last several years and are now approaching clinical development. Our portfolio addresses a number of validated and emerging targets, including MRG PRX2, the TNF receptor 1, CCR6, CD89, STAT6, and CD40 ligand. We expect to initiate human dosing of AB102, an oral small molecule MRGPRX2 antagonist, this month. It will be followed shortly thereafter by our oral and selective TNF receptor 1 inhibitor in early 2027. Overall, the portfolio has the potential to generate a steady flow of INDs between now and the end of 2027. These programs afford us great strategic optionality in disease areas with high unmet need and also with extremely large markets. Finally, in addition to CAS and our immunology programs, we also have an ongoing phase three study in pancreatic cancer. So coming out of ASCO, There's been increasing focus and excitement in this space. We're preparing for initial data from our Phase III PRISM-1 study of Quimley-Klustad and chemotherapy in the frontline setting. We expect this to read out in the first half of next year. We actually see a major opportunity for Quimley as an all-comer, first-line, and importantly, a very well-tolerated option for treatment of this devastating disease. With that, I'll turn the call over to Richard to discuss the status of our clinical programs in upcoming data readouts.

Thanks, Terry. As Terry described, our strategy is to establish castatafan as a foundational standard of care across every line of therapy in Clear Cell RCC. We're currently pursuing multiple different combination studies for castatafan across the first, second, and late lines. In order to conduct this work in a capital and resource-efficient manner, we have been leveraging our Arc20 platform study and generating data through partner platform studies to support and enable our ongoing and planned registrational studies. We will have multiple important data readouts from Arc20 later this year, and there will be a lot of data, so I'll walk through each study, its rationale, and the nature of the near-term readouts. Starting with the first line, CCRCC, We are pursuing a TKI-free approach as the foundation of our strategy, while also developing a TKI-inclusive option. The current TKI-free standard of care is the I.O. doublet, IPI-NEVO. And let me remind you exactly what this regimen is. It's a maximum of four cycles, or 12 weeks, of IPI plus NEVO, followed by NEVO for the duration of the treatment. This therapy is highly valued for the overall survival benefit it provides, but it would be used more if the rate of primary progression, which is roughly 20%, were lower. We believe a combination with Castatafan can improve upon that rate of primary progression in addition to improving progression-free survival and ultimately overall survival. To support the TKI-free approach, there are two key cohorts in ARC-20. First, Castatafan plus Zimberlimab, our anti-PD1, plus IPI, an anti-CTLA-4. This cohort has enrolled well, and we expect enrollment to complete very soon. We're also evaluating a Cas plus Zim first-line cohort in our 20, which completed enrollment at the beginning of this year, for which we've already described a very low rate of primary progression of 7%. That's a 2 of 30 patients. Keep in mind that anti-PD-1 monotherapy was previously reported to show a 30% rate of primary progression in this frontline setting. Now for the TKI-inclusive approach, you'll be developing castatafan in combination with axitinib, a well-established TKI in the frontline that will sequence well with Cas plus Cabo as the subsequent regimen. We expect a new cohort in ARC-20 evaluating this combination to initiate in the fourth quarter this year. In collaborations with BMS and Summit, we are also evaluating novel TKI-free VEGF targeting combinations with anti-PDX VEGF bispecific antibodies in the first-line setting. BMS will be evaluating two Cas plus Pumidac-based combinations in its platform study, Rosetta RCC208. In collaboration with Summit, we'll be adding a new cohort to ARC20 to evaluate Cas plus Ivo and first-line CCRCC. Both of these studies are expected to begin by the end of this year. Now, in the second line, the current standard of care is cabozantinib monotherapy, representing roughly 40% of the second-line market. Peak 1, which is evaluating Cas plus Cavo versus Cavo, is our first registrational study for castatafan. Side activation and enrollment have been going quite well, and we expect to complete enrollment by the end of this year. We also have an ongoing cohort in ARC-20, evaluating Cas plus Cabo in the second line, IO experience setting. We shared initial efficacy data for this cohort last year at ASCO. And finally, in late line clear cell RCC, where the current standard of care is Belzudifan or TKI monotherapy, We're adding a new randomized cohort in ARC20 to evaluate CasDataFan plus TiVo versus TiVo alone in patients that have received prior Bilzutafan. This cohort will generate data to support a registrational strategy combining Cas with TiVo by clarifying CasDataFan's benefit specifically in IF2-alpha inhibitor-experienced patients. We expect enrollment to begin later this year. Now, let me briefly summarize the readouts coming from ARC20 this year. In the first line, initial safety data from the ARC-20 cohort evaluating Cas plus Zim plus Ipi. We've already met with the FDA and EMA to discuss how these data will support the start of our registrational trial evaluating Cas plus Nevo plus Ipi as the bedrock of our frontline strategy. We'll also be able to share preliminary data on primary progression. Also in the first line, we'll have or our data with approximately 11 months of follow-up from the cohort evaluating Cas plus Zim. We will share waterfall and spider plots for that cohort. And given that the median progression-free survival for ipinivo from Checkmate 214 in this first line is just 12.4 months, we expect the spider plots for this cohort to be informative since they may impart an early look at how PFS will unfold for this cohort. In the second line, we'll have more mature ORR and PFS data for Cas plus Cabo in approximately 45 patients with at least 18 months of follow-up. And we may have an early read on OS. And in our late-line monotherapy cohorts, you'll be able to share an early look at overall survival with approximately 28 months median follow-up from the approximately 120 late-line monotherapy patients. While OS is not required for approval in registrational trials for CCRCC, it could impact access in ex-U.S. regions and is recognized as another potential major differentiator relative to ablutipine, which has now failed to show statistically significant benefit in OS in 3 out of 3 registrational trials. So, this first look at OS for testatocon will provide important comparative data. Taken together, these data readouts will create a holistic picture of castatafan's efficacy across all lines of therapy and should generate strong conviction in its potential as the new backbone of kidney cancer treatment. As Terry mentioned, we expect to share the totality of these data together in an investor forum in October prior to ESMO. And with that, I'll turn the call over to Juan to discuss our immunology portfolio.

Thanks, Richard. Over the past few years, the same discovery team that created Gestatifan has been working on creating a broad portfolio of programs that span the whole spectrum of autoimmune and allergic diseases. While we haven't said much about this effort until now, we are very proud of its quality and scope. The overarching strategy has been to design molecules that might provide safe treatments for important patient segments across the immunology landscape. We have also prioritized approaches that leverage our demonstrated expertise in designing potent and selective molecules that work in the real world under physiological stress rather than just in a culture dish. Further, we have looked for ways to minimize the inherent biological risk associated with novel mechanisms of action. You may notice a couple of recurring themes in the mechanisms of action that we have chosen to pursue in implementing our portfolio strategy. including the development of oral small molecule alternatives to establish biologics and an emphasis on targeting immune cell populations that have generally been understudied. We expect a steady cadence of molecules advancing into the clinic beginning with our MRG-PRX2 antagonist and followed by our TNF receptor 1, TCR6, TAD6, CD89, and CD40 ligand programs, all of which are positioned to deliver IMD-ready candidates between now and the end of 2027. Our first program, AV102, an oral MRGPRX2 antagonist being developed for chronic spontaneous urticaria, or CSU, and atopic dermatitis, is wholly owned by Arcus. Available biologics have meaningfully advanced the treatment of allergic conditions but substantial clinical need remains. X2 is a key regulator of mast cell activation in these diseases, releasing inflammatory signals that drive swelling and itch, making this a promising target for conditions like CSU and atopic dermatitis. At the Society for Investigative Dermatology annual meeting earlier this year, we presented preclinical data on an oral X2 approach showing full blockade of X2 dependent , and a division of all common human X2 variants. These data support the potential for a potent, selective, once daily oral X2 antagonist to impact key disease outcomes in conditions driven by aberrant mast cell activity. AB1 or 2 is entering the clinic imminently with PK profile data expected in the fourth quarter. from the first cohorts of our first in-human healthy volunteer study. We expect to follow with a proof of concept study in CSU in mid-2027. Unlike other recent clinical failures in the X2 space, we believe that the excellent potency of AB102, optimized to be efficacious under physiological conditions, provides the best opportunity to run the definitive proof of concept study with an X2 antagonist in CSU. We also are developing an oral small molecule TNF inhibitor as a potential treatment for conditions such as rheumatoid arthritis, psoriasis, and inflammatory bowel disease. Our TNF inhibitor is designed to selectively block TNF receptor 1, which we believe could translate into better safety and efficacy relative to approved anti-TNF biologics. which block both TNF receptors one and two. As you may know, blocking TNF receptor two can paradoxically lead to an inflammatory response in some patients. We expect this program to enter the clinic in early 2027. Behind AB102 and our TNF programs, we have a portfolio of earlier stage immunology programs for which we will share more details as they approach entry into the clinic. I'll now hand it over to Bob to discuss the market opportunity for Casdatifan as well as our financial results.

Thanks, Juan. Before I get into the quarter's financials, I want to spend a few minutes on the multibillion-dollar market opportunity for Casdatifan. Sales for RCC drugs in just the major markets are expected to grow to roughly $13 billion by 2030. Historically, this market has been fragmented, primarily split across the I.O. and TKI classes. With only two HIF-2-alpha inhibitors on the horizon and clear advantages for Casdatofan, we believe Arcus has a path to become a common denominator across lines of kidney cancer treatment. Casdatofan is targeting lines of therapy with large patient populations and long treatment durations. Peak 1 addresses approximately 20,000 IO-experienced patients in the major markets, representing an opportunity of more than $2 billion. and the first-line opportunity is even larger, exceeding $4 billion. All told, we see a total peak sales opportunity for Casdatofan of $5 to $10 billion, driven in part by duration of therapy from a long-term tail effect. This is something we've seen consistently in our late-line monotherapy data, where approximately 25% of patients remain on treatment beyond two years. As a reminder, Arcus owns all commercial rights to Casdatofan outside of Japan and certain other Asian territories where rights are held by our partner TAIO. Turning to QEMLI, we continue preparations for the readout from PRISM-1. While there's been exciting progress made in the treatment of later-line pancreatic cancer, QEMLI has the opportunity to be the first meaningful advancement in the frontline in decades. We believe this is a multibillion-dollar commercial opportunity. Further, we believe QEMLI's well-tolerated profile as well as its promise to substantially enhance the benefit of immunogenic chemotherapy would make it attractive as a combination partner if PRISM-1 is successful. I also want to touch on capital efficiency. Full ownership of Casdatapan gives us significant strategic optionality and supports a capital-efficient collaboration strategy. Our new agreements with BMS, Summit, and Aveo are structured to advance Casdatapan combinations without placing outside demands on our own resources. The same is true of our wholly owned immunology portfolio where the TNF program is the only one carrying an option held by Gilead. Turning to our financial results for the quarter, our cash and investments as of June 30, 2026 were $775 million as compared to $876 million at the end of the first quarter. We continue to expect to end 2026 with approximately $600 million in cash and investments and expect these resources to provide runway into at least the second half of 2028. We recognize GAAP revenue for the second quarter of $41 million and now expect full year 2026 GAAP revenue of $65 to $75 million. Revenue continues to be driven primarily by our collaboration agreements. Future operating results are expected to reflect lower collaboration revenue due to reduced activity under the Gilead collaboration. driven by the wind down of the DOMP and LMED program. Our R&D expenses for the second quarter were $113 million net of reimbursements and we continue to expect meaningful decrease in overall R&D spend in 2026 and 2027 relative to 2025 as a result of the wind down of the DOMP phase three trials and reduced spend on QEMLI together with broader spend management. By 2027, we expect more than 80% of our portfolio spend to be directed toward cash data payment development. G&A expenses were $24 million for the second quarter, and total non-cash stock-based compensation was $15 million. For more details regarding our financial results, please refer to our earnings press release from earlier today and our 10-Q filing. I'll now turn it back to Terry for closing remarks.

Thanks very much, Bob. So let me close by summarizing our priorities for the remainder of 2026. No surprise, Cas Datifan remains our number one priority. We're working aggressively, both independently and with clinical collaborators to expand the development program with the goal of positioning Cas to be the CAG, all caps, backbone of kidney cancer treatment across all lines of therapy. In the coming months, we'll share data for Cas Datifan as monotherapy and in combination in first, second and late line setting. We expect these to further reinforce CasDataVan's best-in-class profile and drive conviction in its potential as a transformative therapy. These studies will support a broad registrational strategy, bringing both the qualitative and quantitative advances that HIF-2-alpha inhibition offers for the Clear Cell RCC treatment paradigm. Starting with the ongoing PEAK 1 study, which is on track for full enrollment by year end, as well as a phase three trial, again that's called PEAK 20, that's evaluating Cas plus Ipi plus Nevo in first line to be initiated by year end. For clarity, I want to confirm that we will be using Ipi-Nevo as the combination partner for Cas Datafan in this registrational study. Beyond Cas Datafan, Our PRISM-1 Phase 3 Trial for Coimbatore Leucostat and Pancreatic Cancer remains on track for a readout next year. And Juan walked you through the exciting progress across our immunology portfolio with AB-102 advancing into the clinic followed by our TNF inhibitor shortly thereafter and other immunology programs over the next 18 months. With $775 million in cash and investments and runway into at least the second half of were well-positioned to execute on all of these priorities. We see a clear opportunity for value creation for patients and shareholders to accelerate, perhaps dramatically, over the coming months. Thank you for joining us today. We appreciate your interest in continued support of ARCIS, and we'll now open the call for questions.

We will now begin the question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Saleem Syed with Mitsuo. Your line is open. Please go ahead.

Great. Congrats on the progress, guys, and thanks for the question. Just one kind of going into all the October data, obviously a lot of data that we'll be getting. Is there a bogey or measure of success that you're looking at in each of these lines that you would care to elucidate here for folks? and also while we're there, are there any particular parts of the data set that you would place a little bit more prominence on where you want people to anchor to? Thanks so much.

Thanks, Salim. Great question and I'll address all that. I'll start at a very high level and then I'll get increasingly granular. So I think you can walk away with some very clear expectations as to how we're looking at things. So at the highest level, I think we want people to walk away and believe they will walk away knowing that castatifan is going to become the backbone standard in RCC across all lines of therapy. So I think one of the ways to frame this is put it in the context of value and value creation and looking at it through an investor standpoint. So I think it's very clear that Last year, we received an inflection in value that was due to recognition in the investor community that there was really a very substantial differentiation between Castatafan and Belzutafan. And what we've heard from a lot of investors is that led sort of to a recognition of value that was reflected in ourselves. and other second-line strategies that we were given value for an expectation that CAS plus CABO is going to be CABO and that's going to look good. I think the other piece, though, was that with that differentiation, there still remain questions as to whether that differentiation, which is clearly there, how will that translate and more broadly, and particularly in the frontline. And I think a couple things have happened. First, you had the failure of LightSpark 012, but then we've also had another year's worth of follow-up clinical data. So I think what's going to happen as we come into this readout is that we'll be able to give very strong Conviction, across all lines of therapy, including the front line. And the front line is huge because that's the $5 billion plus part of the market opportunity. So keep in mind, we have no competition in the front line without Belzutifan there. The competition is the standard of care. So in that context, let me go down another layer. and talk about the front line and build on a couple of things that Richard pointed out. So our foundational registrational study there will be Cas plus Ipi plus Nevo versus Ipi-Nevo. And what we're going to have, we'll have at least 20 patients' worth of data from the Cas anti-PD-1 and the IPI cohort that we're running as part of ARC20. Keep in mind, this is exactly what we've agreed upon with the FDA in terms of safety. So we'll have a safety profile with that 12 or more weeks, and we'll also have a look at the rate of primary progression. And I think the thing that might surprise people as they're thinking about this now, and we get more granular, is that the CASP Zim dataset is actually going to be relatively mature despite being an early dataset. Because if you contextualize a PFS for ipinevo that's just over 12 months, as well as a well-done study with PEMBRO alone where you have a PFS on seven to eight months, you'll be able to get a feel from our curve as to how our PFS is looking compared to those regiments. Also, with over 18 months of median follow-up, I think we'll have a good look potentially at how OS, as we move into the second line, is playing out, and some of these things will start to go across studies. Let me now talk about the second line and build on what I just said there. So in the second line, our CASCABO data will really support that we will have what will look like a better PFS than what was seen with Bell's Lemba. And I think given the safety and We talked a little bit earlier about what's been associated with Lenva and Lenva Bells that we think will have advantages that read on both the safety and efficacy. The other thing to look at is that given that maturity, as I was saying, of over 18 months, I think the shape of our curve will give you a sense that we could have a very dramatically different hazard ratio when we compare it to Cabo versus the hazard ratio of 0.7 that was seen for Bell's Lemba. I think the more important piece, though, is that given that what's known for the OS of Cabo, which is just over 21 months, given that we'll have that 18 months of follow-up, We may see, in fact, what appears to be an OS advantage for the CAS Data Fan Regiment. Keep in mind, our OS is only going to be based upon how we look relative to direct comparison to Cabo, and that'll be defined by its hazard ratio. As Richard mentioned, thus far, Belzutifan has been 043. So we're pretty excited about having those first data that read on OS. And that brings me to the late line. So the late line, we've clearly shown a single agent a very dramatic difference compared to the data that have been generated with Belzutifan. But we'll have 28 months A follow-up. And again, given that the OS for Belzodifan is just over 20 months, I think it gives us an opportunity. You'll see the Kepler-Meier curves. We don't know how it's going to play out, but I think with a very robust, durable HIF-2 inhibitor, this will start to perhaps show us how important HIF-2 really is as a target in Clear Cell RCC. And you'll clearly have some sense, we all will, of how OS will look in that setting. And I think the nice thing there, since it's single agent, that will give read-through. And you were asking about what things are important. I think that'll read through to the mechanism across lines of therapy. So just to summarize, I think overall success will be that you come away knowing that not only do we have a plan for CasDataFan to win, I think we've laid that out pretty clearly, we're executing on it, but those data will have enough data now that you'll see we actually will win and that CasDataFan really will look like it's going to become the common denominator for all Clear Cell RCC treatments.

Okay, super helpful.

Thanks so much, Terry. Thanks, Celine.

Your next question comes from the line of Dana Graybosh with LeRinc Partners. Your line is open. Please go ahead.

Hi. Thanks for the question. Looking forward to another fall event. I wonder if you could talk about LightSpark 12, which we'll see at ESMO after that event, and your expectations for PFS and OS from that study. and is there a specific signal that would give you confidence or increase your confidence that CAS can exceed there with AXI and a PD-1 where Bells, Lemva and Pembro failed? Thank you.

Thanks, Dana. So this is going to be a theme we come back to. People, you know, ask a lot of times about read-through from trials and talk about there's read-through from things where we have the data, light sparks, 012. We don't have the data, but I think the most important thing is go to slide five. You know, you can say like elections have consequences, biomarker data have consequences, and when you look at the comparative durability of the ability to suppress erythropoietin, so the ability to inhibit HIF-2, I think That's the thing that tells 90 plus percent of the story. So people speculated about safety issues of the triplet, etc. I think everything comes down to a dramatic differentiation of the molecules. And I think what you're starting to see now is data where that'll play out. So I think the biggest problem that, you know, Belzutifan probably had is is the durability and the decrease with time and ability to inhibit HIF-2, where their own papers talk about effect on the biomarker looking very nominal at just 12 weeks. Keep in mind, the PFS for the control arm there is 24 months. Thank you very much. As we've talked about, treatment with TKI does induce the increased activity of HIF-alpha. So you get more HIF-2-alpha activity. So essentially what you have in that study is the treatment with the TKI, this is not a discontinuous event. That happens in a continuous way. So you've got increasing levels of HIF-2 activity and you've got a HIF-2 inhibitor that is measured by that biomarker work is clearly not inhibiting HIF-2 as strongly with time. So less activity of the molecule, more activity coming from the TKI-induced HIF-2 activity. So I think that's a recipe for difficulty. Whereas the Arcus molecule, you're talking about a A paradigm of a tumor where 85 to 90 plus percent of the patients have HIF-2 as a driver, and you're going to put a HIF-2 inhibitor, which only brings anemia on top of a good regimen of a TKI and an anti-PD-1, and we feel super excited about it. And we can't even imagine something that would come out of light-sparked 012 that will cause us to think differently. And I'll remind you, our number one focus there is on top of IPI-NEVO, and you'll see a really strong data set, I think, as we go into fall. So we'll feel really great about the front line.

Your next question comes from the line of Jonathan Miller with Evercore ISI. Your line is open. Please go ahead.

Hi, guys. Thanks for taking my question. A couple more about what we're expecting in October. In the second line cohort, can you remind us how much prior Lenvima those patients have gotten? Terry, to your point, not all TKIs are created equal, and we know that sequencing has effects. I think we've seen prior TKI treatment numbers. But how many patients got Lenvima prior? And then secondly, in first line cohort, I'm a little surprised that you're so hesitant about giving ORR or broader efficacy readouts for the triplet in first line. You'll have two scans or more for most patients. What do you expect to see for time to response in first line versus second line? Why are you so hesitant to give ORR and why do you think that there won't be enough to at least start directionally talking about that?

Okay. Remind me the first question, and then I'll get to the ORR. By the way, we're not hesitant. So we'll give you specific numbers at the time. Let me remind everyone else as well, it's probably when people talk about differences between the ARC-20 cascabo as well as our registrational study, versus the LightSpark 011 study because in that study, Merck had Cabo in the control arm and Alemba in the study arm. Really, the only TKIs of probably substantial number that they saw were patients on AXI, so it was probably a mix of AXI and and Ipi Nevo. We'll give specific numbers at that time, but what I'd say is our Lenva patients are very representative of what you would normally see in the first line. So we'll have a substantial number of Lenva patients out of that 40-some-odd patients. It looks relatively like the distribution. In terms of your other question, we will share those information. There's no hesitancy. I think just on expectations, given that, keep in mind that studies enrolled very quickly, that triplet, we think the most important part of those data will be First, the safety, and second, the rate of primary progression, because that's really what you're addressing. And we think even what you'll see from just our anti-PD-1 plus CAS, that'll give you warm feelings about efficacy, given we'll have that 11 months of median follow-up, and that still may improve significantly. We'll share what the early responses look like. I think the thing to think about is that the timing of an IO plus a Cas-DataFan regimen may look a little bit more like IO alone or HIF-2 inhibitor alone where responses did you cross 30% or not when that happens may be more prolonged. The thing is when you combine with the TKI as you know you're really affecting the vascular system and it's a very sort of response fast type of phenomena but then obviously it doesn't give you the Durability. So we'll share those data, but I think the more important things that you'll get out of it are the safety of the triplet, the rate of primary progression. The rate of primary progression from any of the studies we've done that don't include a TKI, particularly those in the earlier lines, as well as a few other monotherapies data sets, and then the Cas plus Zim simply because you will have a longer period of treatment. And so not only will you see ORR there, but I think the shape of the curve, particularly knowing that if you look at actually ipinevo out at 12 months, you're getting in that 50-ish percent, you know, plus or minus place. It'll just be a very clear comparison, but you shouldn't think we have any hesitancy sharing those data. It's just that time will probably affect more of the response rate. I think one other thing that is worth, I'll just use this as an opportunity to highlight this. I think it's probably not fully appreciated because of the totality of the Belzodifan data, how profound the ability to inhibit GIF2 is on durability. But I'll just use actually Belzodifan data. You know, people ask for read-through. We get asked about read-through from LightSpark 012 where we haven't seen the data, but the places where we've seen a lot of data, for example... LightSpark005, and we've seen a monotherapy data. Now, interestingly enough, if you go back and look at those data, median PFS for Belzutifan in that late line setting was about 5.6 months, which is about the same as the median PFS for Everolimus. Similarly, the rate of primary progressions for the two were very much the same. We think those sort of relate to the ability to hit the target heart. However, they still won. They got approval and that's because so much of the manifestation of hitting HIF-2 is coming from what that does to the tumor and how it plays out on the other side of the median. So we think HIF-2 is going to turn out, and I think our data will certainly, you know, give the opportunity to assess that, that HIF-2 is going to turn out to be something that affects everything on those durability measures. And I think that the Belzunifan data have foreshadowed that because despite what's probably a marginal ability to really hit HIF too hard and hit it long, they still had, you know, very good effects. I think the first place where you saw the manifestation of that less than optimal durability of hitting HIF too hard for a long period of time came in their frontline study, and that's probably not surprising because it's comparing versus the longest PFS in the control arm. So the percentage of time that it's bringing value is smaller compared to whether it's the LightSpark 005 or LightSpark 011, where it's fighting a shorter battle compared to the standard of care.

Your next question comes from the line of Lee Westick, with Kantor. Your line is open. Please go ahead.

Hey, guys. Thanks for taking our questions and congrats on the progress. I have two questions. Maybe first to follow up on the lymph question for the second line Cas plus Cabo cohort. How should we think about the impact of prior lymph exposure on the types of patients? You enrolled into the study relative to the Light Spark 11 trial, just trying to understand the right PFS benchmark given some differences in the patient population. And then second, Terry, you mentioned prior TK exposure increases the HIF-2 levels. I'm just trying to clarify if you're implying CASIS-PFS has a positive relationship with prior lines of TKI.

Okay, so thanks on both of those. So the first thing we would say is we actually feel quite good and I mentioned what we saw in the late line that we did not see a degradation in the monotherapy 120 patients prior TKI. And we'll share very specific data in the fall, but we did not see a fall off in efficacy associated with those patients that had seen more TKIs versus the trend that was seen in LightSpark 05 and LightSpark 13. So going in, you know, we're feeling really confident that despite the fact that we'll have those, you know, TKI experienced patients and Lenva patients, we feel very optimistic about the benefit that those patients will received. So sort of across the frontline strategies, we feel good that the benefit that HIF-2 will bring on top of CABO will be advantageous. In terms of comparisons, to your point, one of the things, just give me an opportunity to talk about how we'll present the data. So, you know, I'll even use the word that John used a second ago about hesitancy.

We're going to be effusive with the data.

And I think when we share our data, you can assume we've squeezed all the water out of the sponge of what we know at the time, and you'll have complete knowledge of what we have. And one of the things we're going to do is we're going to use every comparative data set that we can to illustrate, you know, what the advantages of Castatafan are. We feel like it's a great opportunity because, you know, Castatafan is going to bring a lot to the table. And one of the tools that we'll have is the study Cobble Point. And Cobble Point, if you go back and read what the intent was, it really was designed where it looked and two separate groups randomized where you had patients that were treated with TKIs and patients that were treated with IOIO. And then how did those different groups look when they then received CABO? So it's a perfect comparison. Yes, we'll compare to Bell's-Lenva. Yes, we'll compare to any other registrational data with CABO alone. But we also have those nice data sets that were really, if you look at the genesis of that study, the intent was that for future combinations, you'd be able to have a clean data set to see how anything knew what it was bringing to the table. So it's a perfect data set. So we will do subpatient analyses since we'll be forced to go cross-trial comparison as much as everybody doesn't like it. Actually, everybody loves it. and so we'll look at how we compare to both of the segments of the population from the Cabo Point Study to see how the advantages we're bringing to Cabo, whether it's from prior TKI treatment or prior IOIO treatment. And keep in mind, we're going to have curves. So those curves will not only Thank you very much. and what you saw with Bell's Lemba. Nicely, both of our programs were run against the same control and so you'll get a sense of both our hazard ratio versus Cabo as well as how you might think that'll compare to a hazard ratio of what you saw for Bell's Lemba.

This brings us to the end of the Q&A session. I will now turn the call back to Terry Rosen, CEO, for closing remarks.

So I want to thank everybody. You know, we're looking forward to speaking more. A couple of you asked some really great questions, and I think not only will we have a lot of clinical data, but we'll have a lot of science and translational work, much like we had in the Nature paper. So I think we're going to have a lot of great discussions. about the future of castataphan-based therapy. So thanks for joining, and we look forward to speaking to you over the coming months.

This concludes today's call. Thank you for attending. You may now disconnect.