Q1 2022 Agenus Inc Earnings Call

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Operator: music playing music playing Welcome to Agenus's first quarter 2022 financial results conference call. My name is James, and I'll be your operator for today's call. At this time, all participants are in a listen only mode.

Okay.

Welcome to you Zane is first quarter 2022 financial results Conference call. My name is James and I'll be your operator for today's call.

Operator: Later, we will conduct a question and answer session. During the Q&A session, if you have a question, please press 01 on your touchtone phone. And I'd now like to turn the call over to Ethan Lovell, Chief External Affairs and Communications Officer. Mr. Lovell, you may begin. Thank you, James, and thank you all for joining us today. Today's call is being webcast and will be available on our website for

At this time all participants are in a listen only mode.

Later, we will conduct a question and answer session.

During the Q&A session. If you have a question. Please press the zero one on your Touchtone phone.

And I would now like to turn the call over to you for Marvell, Chief External Affairs and Communications Officer. Mr. Lovell you may begin.

Thank you James and thank you all for joining us today.

Today's call is being webcast and will be available on our web site for replay.

Ethan Lovell: I'd like to remind you that this call will contain forward-looking statements, including statements regarding our clinical development, regulatory, and commercial plans and timelines, as well as timelines for data release and partnership opportunities. These statements are subject to risks and uncertainties, and we refer you to our SEC filings for more details on these risks. Joining me today on the call are Dr. Garo Armen, Chairman and Chief Executive Officer; Dr. Stephen O'Day, Chief Medical Officer; and Dr. Dan Chand, head of drug discovery.

I'd like to remind you that this call will contain forward looking statements, including statements regarding our clinical development regulatory and commercial plans and timelines as well as timelines for data release and partnership opportunities.

These statements are subject to risks and uncertainties and we refer you to our SEC filings for more details on these risks.

Joining me today on the call are Dr. Garo, Armen, Chairman and Chief Executive Officer, Dr. Stephen <unk>, Chief Medical Officer Dr.

Dr. Dan Chan head of drug discovery.

Ethan Lovell: Christine Klaskin, Vice President of Finance, and Dr. Jennifer Buell, Chief Executive Officer of Mink Therapeutics. Now I'd like to turn the call over to Garo to highlight our progress and speak to our outlook for the remainder of the year.

Steve Klass, Vice President of Finance and Dr. Jennifer Buell, Chief Executive Officer of <unk> Therapeutics.

Now I would like to turn the call over to Garo to highlight our progress and speak to our outlook for the remainder of the year.

No.

Garo Armen: Thank you, Ethan, and thank you all for being with us today. As we all have witnessed, the biotech sentiment is the most negative we've seen in decades. Given the current climate, I'd like to begin today's call by indicating that we are aware of this reality and are putting on hold all programs which are not critical for near-term value generation. However, wirelessly, and importantly, we are marching ahead with programs which we believe have the prospects of generating significant near-term value. Overall, we expect these steps will result in significant cost reductions for the balance of this year.

Thank you Ethan and thank you all for being with us today.

And as we all have witnessed the biotech sentiment is the most negative we have seen in decades.

Given the current climate I'd like to begin today's call by indicating that we are aware of this reality and are putting on hold all programs, which are not critical for near term value generation.

Wireless and importantly, we are marching ahead with programs, which we believe have the prospects of generating significant near term value.

Overall, we expect these steps will result in significant cost reductions for the balance of this year.

Garo Armen: Ironically, despite recent trends, scientific and medical innovation is at an all-time peak. However, it appears that irrational exuberance coupled with recent regulatory uncertainty, I'm mumbling my words here by even talking about regulatory uncertainty, but particularly this is happening in the U.S., of course, has made it more difficult for investors to differentiate between the good, the bad, and the ugly. Nevertheless, some companies will continue to innovate and achieve success. Several, like us, have already started restructuring their operations and curtailing their ambitions to adjust to current realities.

Ironically this despite recent trends scientific and medical innovation is at an all time peak.

However, it appears that irrational exuberance, coupled with Rachael Ray with recent regulatory.

Uncertainty.

Mumbling My words here by even talking about regulatory uncertainty.

Particularly this is happening in the U S of course has made it more difficult for investors to differentiate between the good bad and the ugly.

Some companies will continue to innovate and achieve success several like us have already started restructuring their operations and curtailing their ambition is to adjust to current realities. While this shifting environment has led to a discouraging financial climate.

Garo Armen: While this shifting environment has led to a discouraging financial climate for biotech, we believe companies like Agenus, with integrated capability, and importantly, platforms that can drive continuous innovation, will emerge at the forefront. A few will be able to build significant value while advancing profoundly effective treatments and cures. At Agenus, we expect that our portfolio of innovative discoveries and our steadfast commitment will trump all hurdles and deliver life-changing medicine to patients while creating significant value for all stakeholders. That's Agenus.

<unk>, we believe companies like Genesis with integrated capabilities, and importantly platforms, which can drive continuous innovation will emerge at the forefront.

You will be able to build significant value.

Advancing profoundly effective treatments and cures.

And then Janice we expected our portfolio of innovative discoveries and our steadfast commitment will Trump all hurdles and deliver life changing medicines to patients, while creating significant value for all stakeholders.

Janice.

Garo Armen: Our strategy is to continue to drive innovation in today's shifting environment. Now, I will outline our highest priority programs. Starting with Potential MAP, our most advanced, fully-owned program represents the highest potential in our portfolio. This is, by the way, based on the fact that the compound, potensilumab, is the most advanced in the clinic among the novel compounds that we have in our portfolio. Our expectations of PotentialMap as a potential blockbus

Strategy is to continue to drive innovation into days shifting environment.

Now I will outline our highest priority programs.

Starting with potentially map, our most advanced fully owned program represents the highest potential in our portfolio.

This is by the way based on the fact that the.

Compound Okay sure map is the most advanced in the clinic among the novel compounds that we have in our portfolio.

Garo Armen: Agent is supported with additional clinical data, which we expect to present at an upcoming cancer conference. Potensilumab is an activator of both innate and adaptive arms of the immune system. Data from our proprietary VISION platform continues to support its broad and unique activity, including responses in patients with so-called cold tumors, which typically do not respond to immune therapy. Thank you. Thank you. Thank you.

Our expectations of potentially map as a potential blockbuster I O agents are supported with additional clinical data, which we expect to present at an upcoming cancer conference.

Okay. So it is an activator of innate and adaptive arms of the immune system.

Data from our proprietary vision platform continues to support its broad and unique activity, including responses in patients with so called <unk>.

Tumors, which typically do not respond to immunotherapy.

Yeah.

We have expanded patient enrollment in our existing clinical trials and.

Garo Armen: We have expanded patient enrollment in our existing clinical trials, in specific cohorts of patients which will form the basis of our first two studies in colorectal cancer, melanoma, and pancreatic cancer. Our efforts to initiate these studies are currently in high gear. Our clinical development strategy for Potassium Ab is to demonstrate clear superiority to existing checkpoint immunotherapies and or other standards of care. This is based on strong signals we have observed in our Phase 1 study in patients who were heavily pre-treated. These observations led to our prioritization of relapsed refractory melanoma, MSS colorectal cancer, and pancreatic cancer as our target indications for potential approval. Now, for a minute, for context.

Specific cohorts of patients, which will form the basis of our.

Phase II studies in colorectal cancer melanoma and pancreatic cancer.

Our efforts to initiate these studies are currently in high gear.

Our clinical development strategy of potentially map is to demonstrate clear superiority to existing checkpoint immunotherapies and or other standards of care.

This is based on strong signals, we have observed in our phase one study in patients who are heavily pre treated.

These observations led to our prioritization of relapsed refractory melanoma.

MSS colorectal cancer.

And pancreatic cancer as our targeted indications for potential approval.

Now for a minute for context.

Garo Armen: Colorectal cancer is the third leading cause of cancer-related deaths in the United States, with over 50,000 Americans dying each year. Immunotherapy treatments for colorectal cancer have been largely unsuccessful, partly because most colorectal cancers are called tumors. And for those with metastatic disease, Five-year survival rates are in the low teens. Also, for context, current standards of care for patients, which are represented in our trials, deliver approximately a 2% response rate, with significant side effects and minor improvement in survival.

Rectal cancer is the third leading cause of cancer related deaths in the United States with over 50000 Americans dying each year.

Immunotherapy treatments in colorectal cancer had been largely unsuccessful.

Because most colorectal cancers are called tumors and for those with metastatic disease.

Five year survival rates are in the low teens.

Also for context.

Current standards of care for patients, which are represented in our trials deliver approximately a 2% response rate with significant side effects and minor improvement in survival.

Garo Armen: In contrast, botansilamab in combination with our anti-PD-1 antibody balsilamab has delivered significantly higher response rates, which will be discussed soon. Botancilli map also holds significant potential in melanoma, where despite treatment advances, there remains few effective therapies for those who fail frontline regimens, particularly with immunotherapies as well.

In contrast, potentially map in combination with our anti PD one off still a map has delivered significantly higher response rates, which will be discussed soon.

But I still am App also holds significant potential in melanoma, where despite treatment advances.

There remains few effective therapies for those who fail frontline regimens, particularly with Immunotherapies as well.

Garo Armen: In addition to these indications, we presented data at last year's CIDC demonstrating that what is still in my benefit in several other cold tumors, including endometrial, cervical, and pancreatic cancers. Over 50% of patients treated with botansilamab had received at least three prior lines of therapy. Potensillimab produced objective responses in these difficult-to-treat patient settings.

In addition to these indications we presented data at last years should see demonstrating that what kind of Chilean map.

Benefits.

And several other cold tumors, including endometrial.

Cervical.

And pancreatic cancers.

Over 50% of patients treated with what I shouldn't map had received at least three prior lines of therapy.

Potentially map produced objective responses in these difficult to treat patient settings, hence, we're preliminarily exploring development strategies across these indications to bring therapy options for patients who have limited or no options today.

Garo Armen: Hence, we're preliminarily exploring development strategies across these indications to bring therapy options to patients who have limited or no options today. The unique attributes of PotentialMap have been the result of the deliberate efforts of our team, who engineered this molecule based on their understanding of tumor biology and the immune system. These translate into a unique mechanism of action that results in the activity of botansilamide across a variety of tumors. At CIDSE, we presented motensilumab's activity in nine different tumors.

The unique attributes of a potential of map have been the result of deliberate efforts of our team.

Who engineered this molecule based on their understanding of tumor biology, and the immune system.

These translated into a unique mechanism of action, which results in the activity or potential of map.

Across a variety of tumors.

At <unk>, we presented what kind of <unk> activity in nine different tumors.

Garo Armen: While this potentially map binds to CGLA-4, it has a much broader activity by targeting both the adaptive and the innate immune arms of the system. We're working closely with scientific and regulatory experts to advance this potentially map in how to treat cancers, which I mentioned include cancers characterized by cold tumor type. We're hopeful that the unique attributes of this molecule will lead to life-changing outcomes for underserved patients, including potential treatments for pediatric cancers.

Wireless potentially my binds to <unk> four it has a much broader activity by targeting both the adaptive and the EMEA innate immune the arms of the system.

We're working closely with scientific and regulatory expertise to advance potentially map and hard to treat cancers, which I've mentioned input Kansas characterized by cold tumor types.

We're hopeful that the unique attributes of this molecule will lead to life changing outcomes for underserved patients, including potential treatments for pediatric cancers.

While advancing our portfolio with our high priority programs. We're also pursuing our business development plans with potential collaborators.

Garo Armen: While advancing our portfolio with our high-priority programs, we're also pursuing our business development plans with potential collaborators. In addition, we're actively looking at innovative financing mechanisms, which we have excelled in delivering previously. Adapting our business model in consideration of the current industry landscape is, for us, a critical extension of our innovation and strategic thinking.

In addition, we're actively looking at innovative financing mechanisms, which we have excelled in delivering previously.

Adapting our business model in consideration of the current industry landscape is for us.

Critical extension of our innovation.

And strategic thinking at.

Garo Armen: Agenus has had an impressive track record of VD transactions and innovative financings with more than $800 million raised in just the past six years and the potential to realize significant milestones in royalty payments from six different companies involving eight product candidates currently in clinical development. As Agenus moves with speed and innovation to execute our scientific discovery and clinical research, we're committed to taking the steps that will ensure our medical advances will be widely available to patients all over the world.

Janus has had an impressive track record of really transactions and innovative financings with more than $800 million raised in just the past six years and potential to realize significant milestone and royalty payments.

Six different companies involving eight product candidates.

Currently in clinical development.

The Genesis moves with speed and innovation to execute our scientific discovery and clinical research, we're committed to taking the steps, which will ensure our medical advances will be widely available to patients all over the world.

Garo Armen: Investing in integrated discovery, development, and manufacturing capabilities and emphasizing international approaches to clinical development and commercialization are critical to achieving our objectives in this regard. We're putting these strategies into practice, for example, with BALZEL, as we strive to make this combination available in ex-U.S. territories, and as we continue to prioritize industry partnerships, which allow Agenus to retain elements of independence and control over the development of our molecules. It is also noteworthy to mention that Agenesis Science has already advanced 16 discoveries into clinical development, and with a very exciting cell therapy company, represented today by the CEO, Dr. Jennifer Bew.

Investing in integrated discovery development and manufacturing capabilities and emphasizing on international.

Approaches to clinical development and commercialization.

Critical to achieving our objectives in this regard.

We're putting these strategies into practice for example, with Val Val as we strive to make this combination of available in ex U S territories and as we continue to prioritize industry partnerships, which will allow a generous to retain the elements of independence.

And control over the development of our molecules.

It is also noteworthy to mention that the Genesis side. She has already advanced 16 discoveries into clinical development.

And with a very exciting cell therapy company.

Represented today by the CEO , Dr. Jennifer Buell.

Garo Armen: That's Mink Therapeutics, created as a separate company, and another, Saponics, potentially in the making. Our ability to discover and innovate best-in-class molecules and treatments has been the basis for a significant number of productive industry partnerships. Our company values and the high value we place on science have been instrumental in industry breakthrough therapies such as GSK's Shingrix vaccine, with current analyst estimates of approaching $3 billion in annualized revenues this year. As I mentioned earlier, we're also sharpening our focus around expense management to extend our runway to continue with our discoveries uninterrupted. Every aspect of this process matters to us. We have initiated a comprehensive review to eliminate non-discretionary spending and implement highly efficient practices.

That's many therapeutics created as a separate company and another <unk> potentially in the making.

Our ability to discover and innovate best in class molecules and treatments has been the basis for a significant number of productive industry partnerships, our company values and the high worse, we place on science has been instrumental in industry break.

Through therapies, such as Gsk's shingles vaccine with current analyst estimates of approaching $3 billion in annualized revenues this year.

As I mentioned earlier, we're also sharpening our focus around expense management.

To extend our runway to continue with our discoveries uninterrupted.

Every aspect of this process matters to us we have initiated a comprehensive review to eliminate non discretionary spending and implement highly efficient practices. While we believe a genesis is in a strong financial position with over two one.

Garo Armen: While we believe Agenus is in a strong financial position with over $260 million in cash, our view is to exercise a conservative fiscal policy, particularly in times of uncertainty in financial markets and drug regulation. Our focus also includes our technology advancements, which drive efficiencies in product discovery and innovation. This is highlighted by our unique discovery platform, VISION, which has led, among others, to our emerging work on the myeloid checkpoint target. At AACR in April, we presented data on our anti-ILT to anybody. Agent 1571, which represents our first fully-owned clinical stage myeloid targeting agent. In preclinical studies, Agent 1571 has already demonstrated several important advantages.

<unk> hundred $60 million in cash our view is to exercise a conservative fiscal policy, particularly in times of uncertainty in financial markets and drug regulation.

Yes.

Yes.

Our focus also includes our technology advancements, which drive efficiencies in product discovery and innovation.

This is highlighted by our unique discovery platform vision.

Which has led to among others to our emerging work on myeloid checkpoint targets.

At ACR in April we presented data on our anti <unk>.

<unk> two antibody.

<unk> $15 71.

Which represents our first fully on clinical stage myeloid targeting agents.

In preclinical studies a gen $6 71 has already demonstrated several important advantages.

Garo Armen: We expect to enroll patients in our Phase I studies of Agent 1571 shortly. Our plans are to evaluate this agent both as monotherapy and in combination, guided by readouts from our vision platform. Last month, we also announced the receipt of a $5 million milestone payment from our partner Gilead Science. While this is a tiny amount, it denotes the advancement of Agent 2373, our CD137 agonist, which has unique advantages over other molecules. CD137 is an important pathway for anti-tumor immunity due to its ability to enhance T-cell and NK-cell proliferation, cytokine secretion, and cellular cytotoxicity.

We expect to enroll patients in our phase one studies of Ags <unk> in 71 shortly.

Our plans are to evaluate this agent both as monotherapy and in combination guided by Readouts from our vision platform.

Yeah.

Last month, we also announced the receipt of a $5 million milestone payment from our partner Gilead Sciences.

While this is a tiny amount it denotes the advancement of age and $23 73, our CD 137, agonist, which has unique advantages over other molecules.

CD 137 is an important pathway for antitumor immunity due to its ability to enhance T cell and NK cell proliferation.

Cytokine secretion.

And cellular cytotoxicity.

Garo Armen: Importantly, Agen 2373 was designed to mitigate the liver toxicity that has limited the advancement of a first-generation molecule. Gilead retains an exclusive option to license Agent 2373, while Agenus has the ability to opt in for a 50-50 profit share and U.S. commercialization rights. Agenus stands to receive up to $570 million in future potential option fields and milestones from this product candidate alone. And there will be, of course, additional royalty payments, depending on the magnitude of a product like this upon successful launch. Development of Agen in 1777.

Importantly, a gen 2373 was designed to mitigate the liver toxicity that has limited the advancement of a first generation molecule.

Gilead retains an exclusive option to license age and $23 73, while a genesis the ability to opt in for a 50 50 profit share and U S co commercialization rights.

Agenda stands to receive up to $570 million in future potential option fields in milestones from this product candidate alone.

And that will be of course additional royalty payments, depending on the magnitude of a product like this upon successful launch.

Development of a gen one triple seven.

Garo Armen: Our FC enhanced tiget by specific antibody partnered with BMS is also advancing in the clinic. We continue to believe One triple seven represents a best-in-class antibody with an increasing body of evidence suggesting or indicating that FC enhancement is required to achieve optimal results with a tiget targeting approach. The programs I highlighted today signify Agenus' unique ability to advance its own pipeline, with its own combination, which is also enabled by information and knowledge we gather from our proprietary vision platform.

Our FC enhanced digit bi specific antibody partnered with BMS is also advancing in the clinic.

We continue to believe one triple seven represents a best in class antibody with an increasing body of evidence, suggesting indicating that FC enhancement is required to achieve optimal results with a tissue targeting approach.

The programs I highlighted today signify a genesis unique ability to advance our own pipeline.

Our own combinations, which is also enabled by information and knowledge, we gathered from our proprietary vision platform.

Garo Armen: Among others, vision informs upstream target prioritization and downstream biomarker identification as well as trial design. It is this ability to work rapidly with independence and integrity, driven by science, that positions Agenus to be a leader in biotech's currently shifting environment. So, thank you very much. I will now turn it over to Christine, and I'll come back shortly after that. Thank you, Garo. We ended our first quarter of 2022 with a cash and short-term investment balance of $263 million, as compared to $307 million on December 31, 2021.

Among others vision informs upstream target prioritization.

And downstream biomarker identification as well as trial design.

It is this ability to work rapidly.

Independence, and integrity, driven by science that positions <unk> to be a leader in biotech shift biotechs currently shifting environment.

Thank you very much and I now turn it over to Christine and I'll come back shortly after that.

Thank you Garo.

We ended our first quarter 2022, with a cash and short term investment balance of $263 million as compared to $307 million on December 31 2021.

Christine Klaskin: We recognize revenue of $26 million for the quarter ended March 31, 2022, which represents an increase of $14 million from the $12 million reported for the same quarter in 2021. Both amounts include revenue related to non-cash royalties earned, revenue recognized under our collaboration agreements, and, in 2022, milestones received. Net loss for the quarter ended March 31, 2022, with $51 million, which includes non-cash expenses of $21 million, compared to a net loss for the same period in 2021 of $54 million, which includes non-cash expenses of $20 million.

We recognized revenue of $26 million for the quarter ended March 31, 2022, which represents an increase of $14 million from the $12 million reported for the same quarter in 2021.

Both amounts include revenue related to noncash royalties earned.

And you've recognized under our collaboration agreements and then 2022 milestones received.

Net loss for the quarter ended March 31, 2022 was $51 million, which includes non cash expenses of $21 million compared to a net loss for the same period of 2021 $54 million, which includes noncash expenses of $20 million.

Christine Klaskin: The per share losses were $0.19 per share in the first quarter of 2022 as compared to per share losses of $0.27 in the first quarter of 2021. Cash used in operations for the three months ended March 31, 2022, was $52 million, up from $43 million for the quarter ended March 31, 2021.

Per share losses were <unk> 19 per share in the first quarter of 2022 as compared to per share losses of 27 cents in the first quarter of 2021.

Cash used in operations for the three months ended March 31, 2022 was $52 million up from the $43 million for the quarter ended March 31 2021.

Christine Klaskin: As Garo mentioned, the company has initiated cost containment measures with expected reductions in operating expenses in the coming quarters. I now turn the call back to Garo. Thank you very much, Christine. To summarize, Despite the stressful external landscape, we continue to make important advances in a field that is in need. We have a number of important developments, including near-term data disclosures and theinitiation of the Phase II Botasilumab Program.

As Gary mentioned the company has initiated cost containment measures with expected reductions in operating expenses in the coming quarters.

I now turn the call back to Garo.

Thank you very much Christine.

Summarize.

Despite the stressful external landscape, we continue to make important advances in the field, which is in need.

We have a number of important developments, including near term data disclosures.

Initiation of phase II potentially map programs with.

Garo Armen: We're delivering on our promise of building a company with a diverse pipeline and moving swiftly to address areas of high unmet patient need. By the end of 2022, we expect to have initiated several new clinical studies, including the three phase two studies for horticillin map that we spoke about and a phase one monotherapy study for agent 1571.

We're delivering on our promise of building a company with a diverse pipeline and moving swiftly to address areas of high unmet patient need.

By the end of 2022 we expect to have initiated several new clinical studies, including the three phase III studies for what is still a map that we spoke about it.

Our phase one monotherapy study for agents <unk> 71.

We also expect to complete enrollment in the relapsed refractory melanoma cohort.

Our combination study involving what is still a map and age and $23 73 in.

In addition, there is of course, the potential of corporate collaborations and additional cash infusions from them.

During the course of this year.

Thank you again for your attention and we will now open the call for questions.

Operator: We also expect to complete enrollment in the relapse-refractory melanoma cohort of our combination study involving Wotacilimab and Agen 2373. In addition, there is, of course, the potential for corporate collaborations and additional cash infusions from them during the course of this year. Thank you again for your attention, and we will now open the call for questions. Thank you, we can begin our question and answer session. If you have a question, please press 01 on your phone. If you wish to be removed from the question queue, you may press 02. And if you're using a speakerphone, you may need to pick up the handset first before pressing the numbers.

Thank you we can begin our question and answer session. If you have a question. Please press the zero one on your phone if you wish to be removed from the question queue. You May press zero two.

And if youre using a speakerphone you may need to pick up the handset first before pressing the numbers.

Operator: So once again, if you have a question, please press 01 on your phone. Our first question comes from Mayank Mamtani, I apologize, from Raleigh Securities. Good morning.

But once again if you have a question. Please press zero one on your phone.

Our first question comes from my neck.

Tammy I apologize from Raleigh Securities.

Yes.

Mayank Mamtani: Thanks for taking my questions and helpful biotech sector-specific commentary there, Garo. So maybe just to kick start things with, you know, your recent prioritization of ILT2 as an important target and my large checkpoint inhibitor. So I was just curious, what was the rationale for that and sort of your history in that space?

Good morning.

Thanks for taking my questions and helpful biotech sector specific commentary there.

Maybe just to kick off things with.

Recent data utilization of IL, two is an important target and in all my life checkpoint.

So we're just curious what was the rationale for that.

Garo Armen: And also, if you could talk about how Sanofi's development, and I think some data coming out at ASCO, will inform your development and sort of the basket of initial solid tumors you might prioritize? And then I have a follow-up. But I will first turn it to Dr. Ban-Chan to address at least part of this question. Thank you, Garo.

And sort of your history in that space and also if you could talk to.

You know how might all fees.

Development than I think some data coming at as the.

Inform yard development and in fact.

That's gonna have a niche in solid tumors do my bad guys and then I have a format.

Let me first turn it shows that the bank channel to address at least a part of this question. Thank.

Dr. Dan Chand: Mayank, thank you for that question. As you're aware, Agenus is well acquainted with ILT space. In fact, we built Merck's ILT4 antibody NK4830, which is progressing in the clinic, showing activity in patients that are refractory to PD-1 therapy, by design. With that knowledge and experience that we've built in the space, we've also retained ILT2 and progressed ILT2 to the clinic, where we have demonstrated, as you can see, at AACR, the potential for ILT2 activity to be not only complementary to PD-1 but also extending activity to colder tumors where PD-1 is not active.

Thank you Garo my own. Thank you for that question as you are aware as well familiar.

With the Iot space in fact, we built merck's <unk> four antibody and keep $40 30, which is progressing in the clinic showing activity in patients that are refractory to.

To PD one therapies.

Designed biogenesis.

With that knowledge and experience that we built in this space. We've also retained altitude and progressed, our Q2 to the clinic, where we have demonstrated that you can see.

The potential for Iot to activity and not only complementary to PD, one, but also extending activity to colder tumors, where PD one.

It's not active.

Dr. Dan Chand: We've also demonstrated broad activity of HF1571, which includes activity that goes beyond just myeloid activation, which includes T-cell, NK, and NKT activation. You'll also notice from our poster at AACR that we demonstrate best-in-class activity compared to other LT2-targeting agents, which includes the most advanced clinical asset, the biome asset. We have demonstrated in head-to-head studies that Agent 1571 has not only monotherapy potential, but it's a superior activator of both myeloid activation and T and MK activation. Great, thank you for that helpful comment. I think the second part of the question is, what tumors will we study? And I think maybe Dan could start and Dr. O'Day could finish that.

We have also demonstrated broad activity of <unk> 71, which includes our activity that goes beyond just myeloid activation, which includes T cell NK I didn't catch your observation.

You'll also notice from our poster at ACR that we've demonstrated best in class activity.

Compared to other Iot to targeting agents, which includes a.

The most advanced clinical asset biomass, we have demonstrated in head to head studies that agent 15, 71 has muddling monotherapy potential, but its superior activator of myeloid.

Activation and T and NK activation.

Great.

Thank you.

Yes.

And then the second part of the question is what Shimmers will we Ah study and I think maybe Dan could start and doctor or they could.

Dr. Dan Chand: Sure, thank you. And I'll turn it over to Dr. O'Day shortly. So, as you saw from our poster, Mayank, we demonstrated that HLA-G, which is the main ligand for ALT2, is expressed in tumor types that are independent of PD-L1 expression.

Finished at sharp. Thank you I'll turn it off the Doctor they are shortly so as.

As you saw from our poster.

We demonstrated that <unk>, which is the Midland in for Alex you too are expressed in tumor types that are independent of PDL. One expression. So we see it as complementary.

Dr. Dan Chand: So, we see this as complementary. Of course, we will be exploring this retrospectively in the clinic. We've also identified as part of our preclinical development potential biomarker of response to HN1571, which will also be applied to our trial. Stephen.

Of course, we will be exploring this.

Retrospectively in the clinic, we've also identified as part of our preclinical development potential biomarker.

Response to agent <unk>, 71, which will also be applied to our trial Steven.

Dr. Stephen O'Day: Yeah, Mayank, thank you for the question. Obviously, the myeloid space has been a challenge, but we really feel this is an important space. The ILT2 that we have put forward with the ACR, as Dan said, has both myeloid as well as lymphoid activation features, which may make it best in class.

Yes Meyer.

Thank you for the question, obviously, you can see our excitement around the the IL.

Two Iot for field, obviously, the myeloid space has been.

Talent, but we really feel this is an important space the ILC to AR that we.

Have put forward with the ACR.

As Dan said has both myeloid as well as lymphoid.

<unk> activation.

Features which may bring as best in class and obviously the aisle.

Dr. Stephen O'Day: And obviously, ILT4, our molecule that Merck is advancing, is showing some early promise. So, in terms of tumor types, you know, I think, obviously, we're going to do phase one and look at, obviously, ovarian cancer, other tumors, even liver metastasis, which may very much be myeloid-dependent, pancreas, and others. So, what's really great about our pipeline right now is Bowdoin still now obviously looks like, as the next generation CTLA-4, is really broader than CTLA-4 in terms of its innate adaptive sort of synapse in the FC-enhanced region.

The board that our molecule that Merck is advancing as looking.

It is showing some early promise so in terms of tumor types, you know I think.

Obviously, we're going to do the phase one I broadly look at cars.

Obviously ovarian cancer or other tumors, even liver metastasis are made very much be a buy.

Myeloid dependent pancreas and others.

What's what's really great about our pipeline.

Pipeline right now is boat is still a matter of obviously looks like.

Next generation features like four is really broader than <unk> four in terms of it.

Adaptive.

Synapse in the FC enhanced region really we think bringing broader.

Dr. Stephen O'Day: Really, we think bringing broader, you know, T-cell repertoire recognition of weak neoantigens, and I think so that innate adaptive space that Bowdoin Stilomab brings, and then bringing a myeloid-active drug that has lymphoid coverage also may be very exciting. So, we couldn't be more excited about sort of the areas of the pipeline that we're going to bring forward and then have Thank you, I understand.

T cell repertoire.

Recognition of weak neo antigens and I think so.

That in need adaptive space that boat still about brings and then bringing the myeloid active drug that has lymphoid coverage also maybe very exciting. So we couldnt be more excited about sort of the areas of the pipeline that we're going to bring forward and then have combination of potential.

Mayank Mamtani: And then on Bertrand Sillimab, how might you be thinking of second half or fall medical conferences for incremental data disclosures? And if you are able to comment relative to what you have said before, obviously, the melanoma landscape is very different than pancreatic, and with CRC, you do have a specific trial design in place, a comparative study, but any incremental thoughts on, you know, melanoma and Let me just tell you about the conference, so we have not disclosed the conference that we're going to be presenting at yet, but it is an important medical conference, a cancer conference, but stay tuned, and that disclosure will be made shortly, but now let me turn it to Dr. O'Day about the trial design.

Thank you.

And then on <unk>.

And the mob.

How might be rethinking the second.

Second half will fall medical quantum foods player.

Incremental data disclosures and if you're able to comment.

Relative to what you said before.

The melanoma landscape.

And then pancreatic and mid CIC you you do have.

Specific guy the Guy in and plays a comparative study, but any any incremental pods.

Melanoma in pancreatic.

It's like development and registration.

The Hudson.

Sure.

Maybe just tell you.

Regarding the contract. So we have not disclosed the conference that we're going to be presenting at yet.

But it is an important.

Medical Conference Cancer Conference.

But stay tuned and that disclosure was made shortly but now let me turn it to Dr de about the trial design one of the reasons are phase II trials have taken a little bit of time to come matches.

Mayank Mamtani: One of the reasons our phase two trials have taken a little bit of time to commence is related to the fact that the regulatory environment has gotten to be somewhat all over the place, and we've had to make sure that we consult with the appropriate parties to design the kinds of trials that are going to be meaningful for the next steps in product registration. Now, with that, it's important to note, and Dr. O'Day will elaborate on this, that all of the trials in the phase two setting.

Related to the fact that the regulatory environment has gotten to be somewhat below.

Over the place.

And we've had to make sure that we consult with the appropriate parties.

To design the kinds of trials that are going to be.

Meaningful.

For the next steps in product registration.

Now with that with that it is important to note conductor or they will elaborate on this.

All of the trials and the phase II setting.

Mayank Mamtani: Given the regulatory environment that we're in right now, trials will be randomized in one way or another. Okay, randomized to either standard of care or randomized within the drug that we're studying. So, Dr. Odeh, please take it from here.

Particularly given the regulatory environment that we're in right now.

Will be randomized in one way or another randomized.

Randomized to either standard of care or randomized within the drugs that we're studying.

So that's what they please take it from here.

Garo Armen: So, what I would say is, as Garo has said, we are laser-focused on our Boat and Stilomab program because the Phase I, which is now an extended Phase I program, is showing really remarkable activity in a number of solid tumors, and the data continues to be encouraging. Because of this, we see it as a potential foundational partner. And the development plan, which has taken some time to really be very strategic, is really going to ask three fundamental questions. One, as a single agent, is it differentiated and powerful?

So what I would say is that as <unk>.

As said, we are laser focused on our boat and still in that program because the phase one which is now an extended phase one program is shown.

Really remarkable activity in a number of solid tumors and the data continues to be encouraging because of this we see it as a potential foundational partner and the development plan, which has taken some time to really be very strategic is really.

Going to ask three fundamental questions one as a single agent is it differentiated and powerful and obviously melanoma is the disease to test that with a clear benchmark for if you live in that which we think we can be.

Dr. Stephen O'Day: And obviously, melanoma is a disease to test that with a clear benchmark for ipilimumab, which we think we can be. The second is colorectal cancer, where combination therapy with RPD-1 is showing significant activity. And so this will be an area where we can see how botanistilumab combines with PD-1. And then finally, a very cold tumor like pancreas, given our preclinical data showing very powerful combinational potential of botanistilumab with chemotherapy in a mouse model and some early signals in the clinic with response to pancreas with botanistilumab.

Second is a colorectal where combination therapy with our PD, one is showing significant activity and so this will be an area, where we can see how 'bout still a mab combines with a PD one and then finally, a very cold tumor like pancreas, given our preclinical data has shown.

Very powerful combination of potential a boat still map with chemotherapy in a mouse model and some early signals in the clinic with response to pancreas with boat is still a map. We think this is an excellent experiment to look at boats still map in combination with chemotherapy.

Mayank Mamtani: We think this is an excellent experiment to look at botanistilumab in combination with chemotherapy. So the three registrational pathways, melanoma, colorectal, and pancreas, are really asking three fundamental scientific questions: single agent activity, combination with chemo, and combination with PD-1. And so we look forward to following that data and seeing if it can become a real new asset to the IO community in terms of target, and most importantly, clinical performance in unmet needs.

The three registrational pathways melanoma, colorectal and pancreas are really asking three fundamental scientific questions single agent activity combination with chemo in combination with.

PD, one and so we look forward to following that data and seeing if it can become a real new asset to the Io community in terms of target and most importantly clinical performance in unmet needs.

Mayank Mamtani: And my final question was on the OPEX savings that you guys are working on. You know, obviously very astute and makes a lot of sense in this environment to, you know, prioritize as much as you can.

Great and my final question was on the.

Opex savings.

You guys are working on.

Got it.

Ah Stewart and.

It makes a lot of sense in this environment.

Garo Armen: So are you able to quantify any of that, or is that sort of work in progress? And maybe also comment on, you know, since a majority of the work will be on potential MAP development and, you know, potential combination regimens in the tumor types we talked about and beyond, how might you be thinking of some of that P&L burden that's to come, you know, starting next year? Okay, so we haven't quantified the savings yet, but let me tell you that it's got to be 5 or 10%.

Prioritize again so.

Quantify.

Any of that but is that sort of work in progress and.

Maybe also comment on you know since May.

You ought to be.

The work will be on the Demcizumab development and potential combination regimens.

Dumont NYC, we talked about and beyond.

How might you be thinking.

No.

Some of that P&L burden that's.

Starting next year.

Okay.

We haven't quantified the savings yet, but let me tell you that it's got to be in five or 10%.

Garo Armen: We are talking about significant savings associated with the measures that we're taking, and um... But, as I said earlier, all these savings are taking place without compromising the delivery of our highest priority programs, which includes 1181. So there's no way we're going to compromise the advancement of 1181 because it is the most advanced, the most promising, potentially blockbuster compound in our portfolio. But that doesn't mean we're not excited about the rest of the compounds in our portfolio. It's just the fact that this is the most advanced that makes it much more compelling to support in the near term.

We are talking about.

Significant savings associated with the measures that we're taking.

And.

But as I said earlier all of these savings are taking place without compromising the delivery of our highest priority programs, which includes what may be one so there's no way, we're going to compromise the advancement of 11 81, because it is <unk>.

The advanced the most promising potentially blockbuster.

Compound in our portfolio that doesn't mean, we're not excited about the rest of the compounds in our portfolio is just the fact that this is the most advanced makes it much more compelling to support near term and as I talked about some of the other compounds are also advancing.

Garo Armen: And as I talked about, some of the other compounds are also advancing. For example, the expenses associated with 1571 through phase one clinical trials are relatively modest, and compounds such as our CD137 are also advancing rapidly with the potential of the option holder exercising the option, which will, when it happens, bring in significant additional cash resources into the company. And 1777, on the other hand, is being advanced entirely with Bristol Myers' support. So a lot of these compounds, other than 1181, are either representing minor expenditures going forward or are entirely underwritten by our collaborators.

For example, the expenses associated with $15 71.

Through our phase one clinical trials is relatively modest.

And compounds such as our CD 137.

We're also advancing rapidly with the potential of the.

Option holder exercising the option, which will it.

It happens, which will bring significant additional.

Cash resources into the company.

And one triple seven on the other hand is being advanced entirely.

Whit.

Bristol Myers is support so.

A lot of these compounds either then.

781.

Either representing minor expenditures going forward or are entirely underwritten by our collaborators.

Collaborators.

Operator: Great, thanks for taking our questions. Our next question comes from T1 of Jefferies. Hi, this is Chi-Yuan Jeffries.

Great. Thanks for taking my question.

Our next question comes from T. One of Jefferies.

Hi, Jeffrey.

Geoffrey Thank you for taking my questions I'm asking questions on behalf of Kelly sure I do have two quick questions number one for the phase two trials for our boats and send them up I just wanted to clarify you said the trial. So about the lunch is that most likely starting Q2 Q3 and the second is that.

Chi-Yuan: Thank you for taking my questions. I'm asking them on behalf of Kelly Shi. Number one, for the phase two trials for Bolton Sinemab, I just want to clarify that you said the trials are about to launch. Is that most likely starting Q2 or Q3? And second, as you said previously, in colorectal cancer or cervical cancer, the response rate is very low. Could you maybe give a rough number like what is likely the response rate that would clear the regulatory hurdle? That's question number one.

Previously you said.

In colorectal cancer.

Cervical cancer. The response rate is very low could you maybe give a rough number like what it likely the response rate.

We are the regulatory hurdles.

Garo Armen: And for question number two, I just want to follow up on the operating cash expenses. Now, besides cost containment, are there any other measures you're currently considering that will potentially raise cash or put it out of the way? What are the expected milestone payments that you're likely to receive in the next few quarters? Okay, so let me start out with the trials and the timing of the trials. All three trials that we spoke about, phase two trials, are expected to commence starting in the third quarter of this year.

Number one and for question number two I just wanted to follow up on the operating cash expenses. Besides the cost containment is there any other measures currently considering that will potentially with cash or putting it out of the way.

Do you think expected milestone payments that you're likely to receive in the next few quarters. Thank you.

Okay. So let me start out with the.

Ah trials timing of the trials.

All three trials that we spoke about phase II trials are expected to commence starting in the third quarter of this year starting in the third quarter of this year and as I mentioned.

Garo Armen: And as I mentioned, one of the reasons it's taken so long is for us to be able to confer with the appropriate advisors, authorities, and so on and so forth, to make sure that we have considered everything. And that's one of the reasons for each trial having multiple arms, including randomization, in some cases, to the standard of care. Ah, end up. All of this means that the trial design has been finalized. So the only hurdle between now and the initiation of these trials is simple operations.

One of the reasons. It has taken so long is for us to be able to confer with appropriate advisors authorities and so on and so forth to make sure that we have considered everything and Thats one of the reasons for each trial, having multiple arms, including randomization.

In some cases to the standard of care.

And.

All of this means that trial design has been finalized.

So the only hurdle with rent now and initiation of these trials.

Simple operations. So we are clear on the kinds of trials.

Garo Armen: So we are clear on the kinds of trials that are going to be the subject of our phase two undertaking. Now, with regard to expenses, I think your question, if I understand it correctly, is, How do you have a question about the expenses?

There are going to be the subject of a phase III.

Undertakings.

Now with regard to expense.

Expenses I think your question if I understand it correctly.

Is.

How.

Okay.

Did you have a question on the expenses.

Garo Armen: Uh... yeah, Yeah, I just want to understand, besides cost containment, are there any other plans to raise cash? Oh, I see. Right.

Yeah sure.

Yeah, I just want to understand besides the cost containment is there any other plans to Oh, Washington right.

Garo Armen: So, and then you also want them to know if there are any additional milestones that we will receive this year. The answer is yes; we expect additional milestones to be received for the balance of this year. We haven't disclosed what they are, but stay tuned. And with regard to additional cash resources, as you know, we've been very, very resourceful in doing collaborations with companies and other creative transactions. We haven't tapped the, I mean, this is a horrible time to do that. We have no plans for any marketed stock issuance, if that is the question that you're asking. And it's a horrible environment to do that in any way.

And then you also Washington director on any additional milestones that we will receive this year. The answer is yes, we expect additional milestones that we received for the balance of this year.

We haven't disclosed what they are.

But stay tuned and with regard to <unk>.

Additional cash resources.

As you know we've been very very resourceful and doing collaborations with companies and other creative transactions, we haven't tapped AR.

<unk>.

Hum.

I mean this is a horrible time to do that we have no plans of any market.

Stock issuance if that is the question that youre asking.

And it's a horrible environment to do that in any way.

Garo Armen: But we've been very creative in transactions, and I don't want to elaborate on what we have in active consideration right now. But everything you do, of course, has some element of dilution, including partnerships, because you're giving up part of the upside of your compounds.

Been very creative in transactions and I don't want to elaborate on what we have in active consideration right now but.

Everything you do is of course has some element of dilution, including partnerships because youre, giving up.

Part of the upside of your.

Compounds, but.

Garo Armen: But what we plan on doing is to be as creative as possible, including potential royalty transactions that will support our needs in the coming years. Thank you. Our next question comes from Matt Phipps of William Blair. Hi, good morning.

What we plan on doing is to be as creative as possible, including a potential royalty transactions that will support our.

Needs in coming years.

Yeah.

Thank you.

Our next question comes from Matt Phipps of William Blair.

Matt Phipps: Thanks for taking my call. Dr. O'Day, I was wondering about your phase 2 melanoma trial and relapsing factor melanoma. Obviously, the first line market is changing a bit with the recent approval of the PD-1 Lag-3. So, just wondering if you're going to enroll patients who have just failed the PD-1, failed PD-1 Plus Lag-3, or would you even enroll patients who have failed Optivo Europe? Yes, hi Matt.

Hey, good morning, Thanks for taking my call.

I was wondering for your phase two melanoma trial.

Relapsed refractory melanoma, obviously the first one.

The market is changing a bit with the recent approval of the PD one lag three so I'm just wondering if you're going to enroll patients who have just failed the PD one.

PD, one plus like three or would you even enrolled patients who failed Opdivo your board.

Okay.

Dr. Stephen O'Day: Yes, obviously, the frontline setting in melanoma now involves three options, you know, single agent PD-1s, combinations with CTLA-4, ipinevo, and then obviously the new LAG-3 PD-1 combination. So we will be looking at all of those groups. Obviously, the space is sort of divided between ipinevo frontline and then PD-1 monotherapy, and we expect that some patients will now be failing. We know that we'll be failing the LAG-3 combination too, and we'll be looking at all three of those.

Yes, Hi, Matt, Yes, obviously, the frontline setting in melanoma now involves three options.

Single agent PD, one combinations with <unk> for <unk>, and then obviously the new.

<unk> lag three PD.

PD one combination.

We will be looking at all of those groups are obviously the space.

Is it sort of divided between hip knee, both frontline and then PD one mono therapy, we expect that some patients will now be failing.

No they will be bally and the lag three combination too and we'll be looking at all three of those we think we have are not.

Dr. Stephen O'Day: We think we have not just a CTLA-4 drug but potentially a broader, you know, drug with 1181, and we certainly want to understand whether it can rescue any of those scenarios. Okay, great, thank you for that. And then just to help clarify what to expect in the third quarter, is this just a combination?

Not just of <unk> four.

Drug, but potentially a broader drug with 11 80, why don't we certainly want to understand whether it can rescue any of those scenarios.

Okay, great. Thank you for that and then just to help clarify for what to expect in the third quarter is it just the combination is there also additional monotherapy update of what you guys showed it to see and then is this all tumor types or was it focusing on some of these are ones that you're going into phase two as far as additional page.

Matt Phipps: Are there also additional monotherapy updates of what you guys showed at CITSE? And then is this all tumor types, or was it focusing on some of these ones that you're going into phase two as far as additional patients beyond what we saw at CITSE? Sorry, Matt, I don't understand the question.

<unk> B all of those sorts of things.

Sorry, Matt I guess I don't understand.

Question.

Matt Phipps: You said some potent still-life updates coming in Q3, some additional clinical data. You know, you guys all show data at CIDSE. Is this just as if the patient's in cross-multimodal therapy and the combination? Is it just the combination?

You said, some but it's still not updates coming in Q3s and additional clinical data.

So did it sits is this just a.

Ah patients and cross selling them up there.

And is it just the combination.

Dr. Stephen O'Day: Yeah, so as Garo said, we are continuing to expand the phase one trial in a number of different areas, particularly around the diseases like melanoma, colorectal, and pancreas that we plan to open phase two trials for. And so we will be bringing data forward at important medical conferences later this year, but we haven't announced where. Additional data around those diseases will be updated at conferences later this year. So Matt, to be clear on that note, as you remarked, we had done a phase one study with over a hundred patients enrolled, and then we were getting set up to start our Phase II studies late last year, and so for a while these Phase I enrollments had slowed down.

Yeah. So as Garo said, we are continuing to expand.

The phase one trial in a number of different areas, particularly around the diseases like melanoma colorectal pancreas that we plan to open phase II trials and so we will be.

Bringing data forward.

Important medical conferences.

Later, this year, and we haven't announced where but the additional data around those diseases will be updated.

<unk> at conferences later this year.

So Matt it should be clear on that note.

As as you remarked.

We had.

A phase one study.

With over 100 patients enrolled and then.

We were getting set up to start our phase III studies.

Late last year and so for a while these are phase one enrollment has slowed down.

Dr. Stephen O'Day: But because of the longer timelines required for our initiation of Phase II studies, we made it deliberate and executed on in enrolling patients in specific cohorts that would be the subject of our phase two studies. And since that decision was made earlier this year, enrollment in those cohorts that will be the subject of our phase 2 studies has actually exploded. And so we have considerably more patients in those cohorts that have generated data, which will be the subject of our upcoming presentation with additional data disclosure. Yeah, no, that's great.

But because of the longer timelines required for our initiation of phase III studies.

We made a deliberate effort.

And executed on it.

And enrolling patients in specific cohorts that would be the subject of our phase two studies and since that decision was made earlier this year.

Enrollment in those cohorts that will be the subject of phase II studies is actually exploded.

And so we have considerable more patients in dose cohorts that have generated data, which will be the subject of our.

Upcoming presentation.

Additional data disclosure does that.

Garo Armen: Thanks for the additional clarity on that. I look forward to taking the questions. And once again, if you have a question, please press 01. And we have no more questions. Thank you very much, everybody, and thank you very much for your attention in these very busy times. We look forward to fielding your questions, and don't hesitate to contact us as required. Thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating. You may now disconnect. Thanks for watching!

Yeah, no that's great. Thanks for the additional clarity on that I look forward to it.

Thanks for taking my questions.

Yeah.

And once again, if you have a question. Please press star zero one.

Right.

And we have no more questions.

Thank you very much everybody and thank you very much for your attention and these very busy times.

Look forward to fielding your questions and and.

Don't hesitate to contact us as required.

Thank you ladies and gentlemen. This concludes today's conference. Thank you for participating you may now disconnect.

Okay.

Yeah.

[music].

Yeah.