Q2 2020 Celldex Therapeutics Inc Earnings Call
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Welcome to the Celldex Therapeutics Midyear 2020 conference call My name your streams and I'll be your operator for today's call.
All participants are in need listen only mode. Later, we will conduct a question answer session.
During the Q an exception here I've a question. Please press star one on your phone.
And then I'd like to turn call over to Sarah Cavanaugh, Sir you may begin.
Thank you very much good afternoon, and thank you all for joining up with me on the call today are Anthony Marucci co founder President and CEO of Celldex Dr. keyboard color co founder Executive Vice President and Chief Scientific Officer, Dr., Diane Young Senior Vice President and Chief Medical Officer, San Martin Senior Vice President and Chief find.
Annual officer Dr. Mark of each Cody senior Vice President of regulatory and Dr. Diego authorized senior director of research.
Before we begin our discussion I'd like to mention that today's speakers will be making forward looking statements such statements reflect on current views with respect to future events on our based on assumptions and subject to risks and uncertainties that could cause actual results may differ materially from those expressed or implied by such forward looking statements.
One of the factors that might cause celldex is actual results to differ materially from those in the forward. Looking statements include those set forth under the headings risk factors and management's discussion and analysis of financial condition results of operation Celldex of annual report on form 10-K quarterly reports on form 10-Q, and its current reports on form 8-K, as well if those described and Celldex.
Other filings with the FTC and its press releases.
All forward looking statements are expressly qualified in their entirety by this cautionary notice you should carefully review all of these factors and be aware that there maybe other factors, causing.
These forward looking statements are based on information plans and estimates out of this call and sell this is not promised that need any forward looking statements to reflect changes in underlying assumptions or factors, new information future events or other changes. Please be advised the question and answer here. It will be held at the close of the call I'd also like to mention that because of the current cobot 19 situation and all.
So to our offices are located in the areas of the Hurricane you do have folks dialing in from a number of different remote locations and I ask that you bear with us at phone lines are a little scratchy, because we're dealing with multiple issues on that and so with that I'd like to turn the call over to Anthony Anthony.
Thank you Sarah good afternoon, everyone and thank you for joining us we hope you're all safe and healthy and appreciate your taken the time to connect with us today.
We're looking forward to updating all of you on our progress and providing more detail on our plans for the future.
I want to take a few minutes to review the recent events and then I will ask my answer to update you on our clinical programs.
To answer review the financials.
The call which are questions.
As you may likely know in early June of this year dark democracy in our a leading medical expert in order to Korea, whose research focuses on mass cells presented data from our kids inhibitor CVX all one fivenine.
Late breaking session at the D.A.C.I. annual Congress.
These data provide important proof of concept for the program has suggested significant potential to dramatically impact mast cell driven disorders.
These data also helps support $250 million public offering driven by high quality healthcare investors.
Importantly, these proceeds will fund the company through 2023, and a number of very important milestones.
We are on track to initiate two studies of CVX, Oh, one fivenine and chronic article area. This fall and have completed considerable work Diane will discuss the support expanded development and 2021 and beyond.
As we have always done we believe is important to focus our resources, both people and financial on the programs that hold the most promise for patients to shareholders.
Based on the current data, we Havent house, we have prioritized the development of arc inhibitor CVX when fivenine.
Cdx 40, agonists CVX 11, 40, and the first candidate from our bi specific program CVX 527, which combines our proprietary CD 27, agonists, but PD one blockade.
In turn we have made the decision not to advance our Erbbthree inhibitor Cdx 3379, which has been in an exploratory study. So tux map to assess the utility of Biomarkers for patient selection as the tux AMAP resistant head and neck cancer.
Despite prophylactic treatment, which Diane will discuss in more detail patients continue to have difficulty tolerating therapy, and we believe our resources our best utilize to expand the development of CVX on 159, and our other pipeline programs.
For our CVX I want to five nine program, we intend to start to murder Korea studies, one in inducible article area and the other in spontaneous urticaria this fall and to initiate both the phase one study of CVX 527, and refractory advanced cancers as well as.
The combination cohort of CVX 11, 40 with chemotherapy in treatment of naive metastatic pancreatic cancer later this year.
These programs will support multiple data Readouts later, this year and next year, including results from the Cdx, One Fivenine study and inducible or Korea, and the first quarter of 2021 and.
And the results from the study and spontaneous urticaria in the second half of next year.
We're also in the midst of a thorough assessment of additional opportunities for Cdx one fivenine.
And as we narrow this list we plan to initiate a third study and another mast cell driven disease next summer.
With this introduction I will like to ask my answer cover these activities in more detail Diane.
Thank you Anthony let me start with Cdx one fivenine.
So one fivenine is a humanized monoclonal antibody developed by sell decks that biased to the kid receptor with high specificity and Potently inhibits its activity the Cape receptor tyrosine kinase is expressed in mast out, which mediate inflammatory responses such as hypersensitivity and allergic reaction.
Ultimately kit signaling controls the differentiation tissue recruitment survival and activity of mass, though and we believe targeting kit represents a unique strategy and diseases involving mapped out.
At the E AC I'm meeting results from our recently completed phase one study in healthy volunteers were presented Cdx, one fivenine demonstrated a favorable safety profile as well as profound and durable reductions of plasma tripcase, a protease meet almost exclusively by mass though.
The phase one study with a randomized double blind placebo control single ascending dose escalation study of Cdx 159, 32 healthy subjects.
Subjects received a single intravenous infusion of Cdx, one fivenine at 0.31349 milligrams per kilogram or placebo.
As Dr. Mauer presented a single dose of Cdx, one fivenine suppressed plasma trip days levels in a dose dependent manner indicative of systemic mast cell suppression or ablation tip days reduction was evident at 24 hours after infusion and minimal levels were typically absurd within one week.
50 suppression below the level of detection with observed after a single one milligram per kilogram dose and with maintained for more than two months at single doses of both three and nine milligrams per kilogram.
A subset of subjects from the three milligram per kilogram and nine milligram per kilogram cohorts agreed to continued follow up per trip taste analysis, which was ongoing at the time of the AC meeting. This follow up an analysis was completed in July and trip days levels remain below the level of.
Protection for 14 weeks in the three milligram per kilogram cohort for 50% of the returning subjects and 18 weeks in the nine milligram per kilogram cohort for all returning centric.
In this study dose dependent increases in plasma stem cell factor also mirror decreases in Kipp days consistent with Alistair blockade of stem cell factor to kit and further demonstrating complete target engagement in vivo.
Importantly, cdx one fivenine also demonstrated a favorable safety profile. The most common adverse events were mild infusion related reactions, which spontaneously resolved without intervention.
Symptomatic decreases in neutrophil and white blood cell counts were also observed in laboratory testing, but we're returning toward normal at the end of the study.
We also observe long half life and lack of anti drug antibodies, which provide support to explore less frequent dosing in future studies.
Based on these results we plan to initiate two phase one studies of CTX, a one fivenine. This fall wanting chronic inducible urticaria and one in chronic spontaneous urticaria, both of which are mast cell driven diseases, specifically selected to provide clinical proof of concept for cdx.
One fivenine.
Ill start with the study in the inducible urticaria as this indication will read out first with data expected in the first quarter of next year.
There were multiple forms of inducible urticaria and 0.5% of the total population suffer from them. We have selected two of the most common form.
Dramatic dermagraft system and cold induced urticaria.
Symptomatic Dermagraph Ism is characterized by the development of a wheel and flare reaction in response to a stroking scratching or wrapping up the skin usually occurring within minutes of the inciting stimulus.
People afflicted with cold induced urticaria experienced experienced symptoms like it chain burning wheels, and angioedema, where their skin comes in contact with temperatures below skin temperature.
For both of these diseases mast cell activation, leading to release of soluble mediators is thought to be the driving mechanism leading to the wheels and other system.
As you can tell based on their names what's unique about these indications is that they are induced by certain triggers and importantly investigators can induce the same reactions in the clinic Dr. Mauer will lead. This study in his specialty clinic for urticaria in Berlin, we expect to enroll 20 patients.
10, with symptomatic Dermagraph Ism, and 10 with cold induced urticaria for resistant to ANTA histamine treatment.
Their symptoms will be induced in the clinic and a single dose of Cdx 159 at three milligram per kilogram will be administered patients will be followed for 12 weeks to evaluate safety and tolerability clinical activity and pharmacokinetics and pharmacodynamics importantly, we intend to perform cereal skin buyout.
Just on patients. So we can explore the impact of Cdx 159 en masse cells in the skin. This will help address whether cdx. One fivenine is in activating the mass cells or leading to their death and elimination from skin.
The second study will be in chronic spontaneous urticaria foresee US you an indication where patients experience urticaria symptoms without identification of unknown caused.
This is a disease driven by mast cell activation the release of mediators, resulting episodes of itchy hyve swelling and inflammation of the skin that can go on for years or even decades. It is one of the most frequent dermatologic diseases with the prevalence of 0.5% to 1% of the total population and up to.
3.2 million cases annually in the U.S.
The study will be a randomized double blind placebo controlled phase one be dose escalation study that includes patients who are still symptomatic despite ampla histamine therapy.
We expect to enroll 40 patients across four cohorts, who will receive cdx or what fivenine or placebo the dose and dosing schedule will vary by cohort patients dosed at 0.5, and 1.5 milligram per kilogram will receive three doses at four week intervals and patient.
Dosed at three and 4.5 milligrams per kilogram will receive two doses at an eight week interval.
The 12 week treatment period will be followed by another 12 weeks a follow up so 24 weeks total.
This design will provide necessary data on the safety of multiple doses and also allow us to evaluate the potential clinical activity of Cdx 159 in this patient population.
Again, we will be evaluating safety and Tolerability symptomatic relief as measured through disease activity scores and pharmacokinetics and pharmacodynamics. This study will be conducted at four to five centers in the USA beginning in the fall of 2020, we anticipate results from this study in the second half of new.
Next year.
For both inducible as spontaneous urticaria. It is clear that these patients can truly suffer the too tough complaints are constant intense IDG and poor sales image their symptoms prevent regular sleep interfere with daily life and work activities, which subsequently promote social withdrawal.
Relations and depression, there is truly an unmet need for efficacious therapies that address the root cause of their disease mast itself.
Beyond urticaria, there are many diseases in which math, though are the principal driver or a thought to significantly contribute to the pathology. We're digging deep dive deeply into the potential opportunity for Cdx 159 in these indications to select additional areas for it.
Spansion. Our evaluation includes review of scientific literature medical guidelines regulatory documents and market analyses and discussions with medical experts, we are prioritizing indications in which there is strong evidence that math both play an important role in pathophysiology, where there are unmet.
Medical needs and where we can envision a clinical development path with clear early decision point.
We have narrowed what began as a list of over 50 indications to four Marriott major areas of focus.
Mast cell activation syndromes, including mastocytosis asthma, including severe forms of asthma allergic asthma and exercise induced asthma allergic conditions, including food allergies, and allergy mediated dermatologic conditions and mast cell driven gastrointestinal disorders are.
Our next step is to lay out the clinical development and regulatory path as well as commercial opportunities to health in the final indication selection.
We will also be monitoring the field closely to ensure our plans continually reflect all available by anticipate clinical regulatory and competitive data.
Certainly as data begin to emerge from the Urticaria studies. This will also inform our final decision. We will continue to update you as we complete our diligence, but are confident we will be in a position to initiate a phase one be two study in a third indication by summer 2021.
Finally in closing for Cdx 159, I want to point out that we have initiated formulation work for subcutaneous delivery, which we believe will be important to the candidates future success. We believe we are well positioned given cdx, one fivenines enhance PK profile and the durable triptan.
Suppression, we observe even at low doses the preliminary feasibility studies at 150 milligrams per mill look promising.
With that overview Cdx, one Fivenine, let me turn now to Cdx 11, 40, and Cdx 527.
Cdx 11, 40 is the Celtics developed human agonist anti CD 40, monoclonal antibody that was specifically designed to balance good systemic exposure and safety with potent biological activity, a profile, which differentiates cdx 11 40 from us.
Theres CD 40, activating antibodies for systemic therapy.
CD 40 expressed on dendritic cells and other antigen presenting cells is an important target for immunotherapy as it plays a critical role in the activation of innate and adaptive immune responses.
Cdx 11, 40 completed dose escalation as monotherapy and in combination with Cdx three old one a dendritic cell growth factor in an ongoing phase one study in patients with recurrent locally advanced or metastatic solid tumors and b cell lymphomas.
Critical goal of this study was to achieve dosing levels that provide good systemic exposure without dose limiting toxicity as reported at the Cincy meeting last November.
Excellent 40 reach this goal with a maximum tolerated dose and recommended phase two dose of 1.5 milligram per kilogram one of the highest systemic dose levels in the CD 40 agonists class.
We believe the relatively low doses of other potent CD 40 agonist antibodies tested in the clinic today may limit their potential and modifying the tumor microenvironment and are hopeful that Cdx 11, 40 at this dose level will better penetrate tumor and be more impactful.
Importantly from a safety perspective at 1.5 milligram per kilogram Cdx 11, 40 is associated with manageable immune related adverse events that are consistent with those observed with a proved effective therapies like checkpoint inhibitors, while cdx 11 40 has shown.
Promising signs of single agent activity, it's clear that combination approaches that target multiple pathways in the immune system likely offer patients the best opportunities for improvement.
To that end, we have added multiple combination expansion cohorts, including with Keytruda in patients who have progressed on checkpoint therapy and with Cdx 301 in patients with head and neck squamous cell carcinoma.
We also expect to initiate a combination with standard of care chemotherapy in first line metastatic pancreatic cancer later this year and indication we are very interested in because both preclinical and clinical data suggests that the CD 40 pathway may have important anti tumor potential in this disease.
We also expect to report on interim data from Cdx 11, 40. This fall that would focus on data from the monotherapy expansion cohorts in squamous cell head and neck cancer in renal cell carcinoma.
Data from the combination with Cdx three aligned and preliminary data from the combination with Keytruda.
Cdx 527, our first by specific antibody program is also expected to enter the clinic later this year.
Cdx 527, combined CD 27 mediated T cell activation with PD one blockade we have developed Cdx 527 from our proprietary highly active PDL, one and CD 27, human antibodies and demonstrated the bi specific to be more potent then.
The combination of the individual antibodies in preclinical models.
Importantly, our prior clinical experience combining the CD 27 agonist antibodies varlilumab with PD one blockade supports the integration of these two antibodies from a dosing safety and activity perspective.
We would expect initial data from this program in the first half of 2021.
Before I turn the call over to Sam to discuss the financials I want to provide a little more clinical context surrounding the decision on Cdx 337 mine development.
At ESCO 2019, we presented a retrospective analysis that suggested that the anti tumor activity with Cdx 307, nine might be associated with somatic mutations in particular genes associated with tumor suppression.
We decided to examine this hypothesis in an exploratory manner in the ongoing trial to see if there was a path forward that would allow us to utilize bio markers to identify at targeted population that would respond to cdx 3379.
In parallel we knew that we needed to improve the tolerability of the combination of Cdx 3379, and Centex AMAP, specifically diarrhea management.
Unfortunately, despite diarrhea pro full access measures. This continued to be of side effects, which in addition to severe skin rash caused dose reductions and delays in the majority of patients, making it difficult to achieve clinical benefit.
When considered together and after talking to our study investigators we believe the risk benefit profile does not support further development in patients and that the resources allocated to this program would be best focused on expanded development of Cdx 159, Cdx 11, 40, and Cdx 520.
Kevin.
We will also continue to advance our preclinical pipeline, which is exploring several interesting targets, including axle aiotv for CD 24, and similarly 15.
Updates on our preclinical programs will be presented at scientific meetings later this year and next.
In summary, we are very pleased with the progress we've made so far this year. We believe Cdx 159 has the potential to be a field changing product across multiple mast cell driven indications and the Cdx 11, 40 is establishing itself as a clearly differentiated CD 40 agonists.
We're excited to bring Cdx 527 into the clinic and all combined look forward to a very busy rest of 2020.
We continue to be mindful of Kopec 19, and our partnering closely with our clinical trial sites to mitigate any kosik related impact on our studies.
So far we have been very successful in these efforts the like everyone else. We are looking cautiously at this fall and winter and contingency planning to help mitigate any risk to our timeline.
With that I. Thank you for your time and I will hand, the call over to Sam to review the financials Sam.
Thank you Diane.
For the second quarter of 2020 net loss was $11 million.50 per share compared to a net loss of $11.8 million or 84 cents per share for the second quarter of 2019.
Net loss for the six months ended June 32020 was $23.7 million or $1.20 cents per share compared to $29 million or $2.21 per share for the comparable period in 2019.
Research and development expenses were $21.4 million for the six months ended June 32020, compared to $21.2 million for the comparable period in 2019.
General and administrative expenses were $7.2 million for the six months ended June 32020, compared to $8.8 billion.
For the comparable period in 2019.
As of June 32020, we reported cash cash equivalents and marketable securities.
$206.9 million compared to $53.7 million as of March 31st 2020. The increase was primarily driven by net proceeds of $141.4 million from our June 2020, underwritten public offering and net proceeds of $23.7 billion.
From sales of common stock under our controlled equity offering agreement with Cantor completed in the second quarter prior to the public offering in June.
These increases were offset by second quarter cash used in operating activities of $11.2 million.
We expect the cash cash equivalents in marketable securities at June 32020 are sufficient to meet estimated working capital requirements and fund planned operations through 2023.
At June 32020, we had 39.1 million shares outstanding.
I will now turn the call over to Anthony to close.
Thank you Sam Thank you all for joining us today.
To recap as always we remain focused on the successful development of our clinical programs.
We look forward to initiating the two phase one be studies.
CVX on 159, this fall and the phase one study of Cdx 527, and the CVX 11, 40 expansion cohort later this year.
Followed by the third study of CBX on one Fivenine and an additional mass so indication next summer.
For data read outs, we plan to presented data update for the CBX 11, 40 program later this year.
In 2021, we anticipate data from the CVX or 159 study in chronic inducible armored car urticaria in the first quarter.
Data from CVX 527 in the first half.
And data from the CVX on one Fivenine study and the chronic spontaneous urticaria study in the second half of the year.
I would also anticipate data from the CVX 11, 40 combination with Keytruda and other expansion cohorts in 2021.
As Sam said, we are well capitalized to complete studies necessary to reach these milestones and for that I'd like to thank you investors that participated in our recent financing.
We look forward to keeping you all up to date as we continue our progress on these programs.
With that review will open the floor to questions operator.
Thank you we've done our question and answer session. If you should have a question. Please press star one on your phone.
If you were three removed from the questions you May press, the pound sign or the hedged.
And if you're using a speaker phone you may need to pick up the here. So first report prosigna numbers. So once again, if you have a question for star one on your phone.
And our first question comes from Christian.
Sure.
Okay that's true.
Hi, everyone. Thanks for taking my questions and congrats on the Great Congress that you need over this past quarter.
First question is through the Cdx year, one signed nine program given that some of these patients are likely to have co morbidities Im wondering if you might think these are worth evaluating in the background either or both the sees one BNP two studies to provide any early cruises effect given these indications could also be mast cell German.
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Sure Kristen. Thanks. This is Andy I'll have Diane answer that question, yes, So thats an excellent very good point, Chris and that there is a lot of.
Overlap and other conditions that.
No overlap that that May also be impacted so that is our intention to.
We know even in those early studies to try to capture what what other co morbidities and the patients haven't end to try to with that.
Responses from way.
Great. Thank you and then as it relates to achieving that third mass told you are going indication and initiating studies in the summer of next year I wanted to ask if you think the results from this didn't you trial in the first quarter of next year, one anyway helped determine which when you ultimately choose a third indeed.
Asian.
Yes, So I think we'll definitely take the data from the.
From the thing do study that that's going to give us information about.
How were how were impacting mat sales and some ideas of dose and duration of clinical effect. So I think that that that will definitely help to inform what we do next year.
Okay. Thanks, and then they understand.
The vision that you'll be evaluating your Steve Lindsey trials are refractory to into his team.
So yes, the majority lead into or refractory have already been prescribed up to the four times dosage would you.
Part of the guidelines associated with the disease and then you also expect or indeed that perhaps some of the patient in make yes, you trial could have failed golar you previously.
Mark will do you want to take now on.
Sure I'd be glad you have any the thanks to the question is within that four time dosage is a common usage, but we're not going to require that they have gone that high.
Individual clinician may.
You can manage individual patient differently. So we do need them to have failed at least the approved dose and then they can go higher.
Additions would like to.
In terms of.
Good day Xolair prior used for the on C. as you study we are interested in what priors, although you might look like in terms of pattern of response.
Olin Fivenine, so we're going to allow it but we're not going to mandated and so if someone has had nowhere previously we're going to need to be offer that for at least three months with washed out, but we're not donate restrict patients who had previously seen xolair from coming into the study.
Okay got it. Thank you and then for Cdx 11, 40 are you able to provide any more color as it relates to patient numbers are specific endpoints from some of the cohort where you could have some data available to second half this year.
So.
Yes, and we're still in other studies still ongoing and we're collecting data in the course.
I can't I can't actually give you an idea of the precise numbers that we were going how we're going to have.
The complete data from the dose escalation cohort with three old one and then we expect to have data from several of our expansion cohorts as many patients as we put on it will be interim data.
And then we expect to have an early look at the combination with Pembrolizumab in that study.
Okay. Thank you and then my last question if I may firsthand, how should we think about spending trends with the addition of these new trials, but then also factoring the discontinuation Cdx 3379.
Sure. Thank you I think that weve factored that in as far as our guidance of through 2023 and as we build out those plans over the next 12 months we can.
Considering that can be extended or not and.
Go from there.
Okay, great. Thanks, so much again everyone.
Thank you Chris.
And as there are no more questions I'll turn the call back to Anthony merger.
Thank you operator, and thank you so everyone for joining US today, we appreciate your time and support and we look forward to talk into later on this year as always we welcome your questions at any time, so have a great evening and a safe summer. Thank you.
Thank you ladies and gentlemen, this concludes todays conference. Thank you for participating you may now disconnect.
Yeah.
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