Q2 2022 Innate Pharma SA Earnings Call

your conference.

Thank you very much. Good morning and good afternoon and welcome everybody. This morning, NATE issued a press release providing a business update for the half year 22 results. We look forward to highlighting the progress made during the quarter as well as addressing future goals and milestones. The press release and today's presentation are both available on the IRE section of the website. Please turn to slide number two.

Before we start, I would like to remind you that we will make forward-looking statements regarding the financial outlook in addition to regulatory and product plan development.

These statements are subject to risks and uncertainties that may cause actual results to development.

Turning to slide three, on today's call we will be joined by Monda Majoubi, our CEO , who will then hand over to Joyce and Cara Connell, EVP and Chief Medical Officer, Yanis Morel, EVP, Business Development and Product Portfolio Strategy, and our Chief Financial Officer, Frederick Lombard, for an update on the financials.

Mondo, I will now hand the call over to you.

Good morning, everyone.

Before you start let me remind you of our strategy. Please move to slide number 4.

Our strategy centers around three key priorities, where we look to create value from our early pipeline through data-safe partnership where it makes sense to do so.

First, we look to create near-term value driven by our lead proprietary asset, LekitaMap, which as you know is in clinical development for T-cell lymphoma with readouts during the second half of this year. And two, ongoing trials with a larger indication of peripheral T-cell lymphoma.

Second, mid-long term we continue to fuel our pipeline and create long-term value leveraging our antibody engineering capabilities to develop innovative molecules with a primary focus on upper multi-specific NkCL-engager platform called ANKET.

Sanofi have the most advanced anchor in the clinic today. They have selected another candidate and we are nearing the clinic with the others. On the adenosine pathway, we have also announced plans to progress our CD39, APH52-1 to Phase 2 in partnership with AstraZeneca.

Last but not least, we are building a strong and sustainable foundation for our business, leveraging the various partnerships across both industry and academia.

We are a strategic partnership with Monolismar is continuing in lung cancer. Our focus is to leverage the value of our products as much as possible and we want to ensure that if we can gain valuable competencies via a partner agreement, we will consider that in our development plans for the product. This will further validate our science and offer capital that we can invest to advance our early portfolio.

Before I hand over to Joyce, please move to slide five which is an overview of the pipeline. It shows how we have translated our science into a robust portfolio of proprietary and partnered assets.

assets. It also illustrates how we are executing against our strategy with our lead proprietary asset, LacunaMap, supported by partner and earlier stage.

in particular from our NkCL Engager and KET platform.

We're also pleased to see the progress throughout the portfolio with several clinical assets continuing to progress from phase one through to phase three trials.

At this update, we announced that we have regained the right to four preclinical molecules from AstraZeneca and we look forward to updating you on our development plans and progress on these molecules in Utah.

We anticipate a series of potential clinical readouts and catalysts in the upcoming couple of years, as our R&D engine looks to leverage our scientific know-how to create a sustainable business.

I would like now to pass the call over to Jorison who will review the progress made in our portfolio starting with Lekitha Mab, our most advanced property asset. Jorison, over to you.

Thank you, Monda. On slide 6, let me start with our first-in-class humanized monoclonal antibodies that target the immune receptor, KIR-3-DL2. As you may remember, KIR-3-DL2 is an inhibitory receptor found in approximately 65% of patients across all cutaneous T-cells and thrombosis.

in the Calamet trial.

cohort one including surgery syndrome patients could potentially be a pivotal cohort.

For mycosis longuides, we have cohorts 2 and 3, which have been presented previously and are testing the hypothesis of non-expressors and expressors of Tier III DLT using the Fermi companion diagnostic assay.

As expected, a scientific hypothesis confirmed in forward to a high global response rate in comparison to the benchmark and the non-expressive cohort, which had a low global response rate in 2020.

As promised, on September 23rd, we are pleased to announce that we will be presenting preliminary data from the Mycosis Funguides cohort II in a few weeks at the EORTC Congress in Madrid.

On slide seven, let me summarize the progress we've been making with the clear map.

We are pursuing a faster market strategy for LacunaMav in the niche setting of Cesare Syndrome, where LacunaMav was granted US Fast Track designation and EU Prime designation in 2020.

We have expanded past cesarean syndrome to mycosis-1 group, where we have seen encouraging preliminary data from our phase 2 trial.

for surgery syndrome and mycosis fungalities, enrollment is on track.

For surgery syndrome, we will be presenting the initial data from the potentially pivotal cohort in the second half of 2022.

Finally, we are continuing to enroll into peripheral T cell lymphoma in the monotherapy and combination trials in the relapsed setting.

On slide eight, I would like to update you on Monalismab to remind you. Monalismab is an anti-NKG2A which acts upon the checkpoint pathway to potentiate NCCL activation that we have licensed to AstraZeneca for oncology.

Although we are disappointed with the results from a monolibernate head and neck cancer over the summer, we are pleased to see the early lung cancer program is underway with further proof points being presented this year.

There are currently two ongoing AstraZeneca sponsored early lung cancer trials underway with monolizumab in combination with NTPBL1-dervalumab.

On slide 9, you can see an overview of the late stage development plan for memories of the nineJim Amen Massachusetts.

As mentioned, based on the AstraZeneca-sponsored Phase II Coase data, AstraZeneca has commenced Pacific Nine, a Phase III trial evaluating the combinations of either monolizumab or eiculumab plus divalumab in the unresectable Stage III non-small cell lung cancer setting who have not progressed after concurrent chemo radiation therapy.

For the phase two COSE study, the three arms evaluated the combinations of darvalumab plus erythronine and darvalumab plus erythronine.

AstraZeneca's anti-CD73.

As published earlier in the year in the Journal of Clinical Oncology by AstraZeneca, after a median follow-up of 11.5 months, the results of the interim analysis showed a hazard ratio of 0.42 for dervalumab plus monolizumab versus dervalumab alone.

The results also showed an increase in the primary endpoint of confirmed overall response rate for duralumab post-monolismab over duralumab alone of 36% vs 18% respectively.

Although small numbers in the PFS exploratory subgroup analysis, monolizumab with divalumab demonstrated a trend favoring the combination in two different high HLAE and KG2A expression and supporting the mystic rationale for the combination.

We were also pleased to see that further analysis from the AstraZeneca sponsored NeoCoast data was presented at the ESMO Congress in Paris this week.

Neocost 2 is a Phase 2 study in stages 2A to 3A non-crossover lung cancer.

that includes a treatment line with Monolismab in combination with Gervalumab and chemotherapy.

The presentation provided the importance of ctDNA in the neoadjuvant setting in the monolism of the neuron by demonstrating a decrease in ctDNA.

On slide 10, I would like to highlight the progress of our assets targeting the identity pathway.

which is increasingly recognized as critical in the tumor immunosuppression and two approaches here in the Arctic.

For NTCD 39, IPH 5201, we have announced that we are progressing to phase two trials in collaboration with AstraZeneca in lung cancer and received a five million dollar milestone payment.

The Phase 1 in collaboration with AstraZeneca has concluded in solid humans in combination with Dervaluimab and AstraZeneca expects the data this year.

for our NTCD 73 IPH.

We have one, an investigator-sponsored phase one trial is underway where the IST is exploring a differentiated approach combining our anti-CD-73 with trust to demand and chemotherapy in her two positive cancers.

We look forward to further updates in this clinical program next year.

I will now hand over to Yanis to cover our NCAT program.

Thank you, Joyce.

On slide 11, I wanted to highlight the latest updates from our proprietary multi-specific NCESS longager platform that we call NCESS. NCESS is a funding for antibody-based NCESS longager platform that we call NCESS.

We are pleased to have presented our latest innovation at major scientific and medical conferences, including ESMO, as last weekend by our CSO, Professor Eric Diguet, as well as ACR and CT last year.

NCAT is a versatile fit for purpose technology made of various building blocks that is creating an entirely new class of ever tri- or cross-specific engagers to induce in the key community against Target-based technology and is standard for building blocks for an over-less than seven

This technology platform, which is leveraging our scientific expertise in the NPTEL space, will be an engine for our pipeline, creating value via multiple drug candidates, addressing multiple tumor talents.

Our excitement for this ANKET platform is supported by pre-clinical data we have to date. First, the ANKET platform allows for optimal harnessing of the NKSL effector functions due to the unique engagement of the activating acceptor NTP46 and CD16 that are both expressed on NKSLs.

Second, this technical efficacy can be further increased by the addition of IL-2 variants, which targets the IL-2 receptor beta-gamma complex, which is quantitatively expressed on NK cells, inducing their proliferation within the tumor microenvironment.

Overall, this platform demonstrates better clinical anti-tumor efficacy than we have seen technically with clinical-approved benchmark antibodies against the same tumor targets.

On slide 12, you can see our most advanced ANCAD program is a CD123-service tri-specific molecule IPL6101 or SAR579 that we are in collaboration with Sanofi.

It is no license to them and currently in phase one trial.

We also announced over the summer that Sanofi have selected for further development a second time this year vs the Samson

It is called IPH6401 or SAR-514 and it is a VCA metatardic tri-specific NCAT molecule using phenofly, cross-modal format which shows the versatility of our platform.

We now have announced 13 million in milestone to date from his partnership with Sanofi.

Our most recent generation of Ancat molecules is a tetra-specific version incorporating a cytokine to support the N-K-CEL proliferation. It's also progressing toward the I-N-D study, with the first I-N-D filing expected in 2023 for the I-P-H 6501. As Monda also mentioned, we will provide an update on next steps for the other assets from our clinical portfolio in due course. Thank you.

I will now hand over to Frederic for an update on the financials.

Thank you Yannes. On site 13, as usual, you can find the consolidated financial statements as of the six months ended June the 30th this year and including in our press release for further information.

I will cover the highlight on this slide.

Cash and cash equivalents, short-term investment and financial assets amounted to 158.2 million as of end of June this year. This does not include the 5 million USD and 3 million euro announced from AstraZeneca and Sanofi for the ETH 52.01 H2 progression and the NKBCA target selection of already expected 10 million of resource tax credit due in H2.

Revenue and other income from continuing operation amounted to 45.6 million euro in the first half of 2022.

14.7 million in the first half of 2021.

and mainly comprised revenue from collaboration and licensing agreements.

These mainly resulted from the partial or entire recognition of the proceeds received from the agreement with AstraZeneca and Sanofi, and which are recognized on the basis of the percentage completion of the works performed by the company under such agreements.

Governmental funding for research expenditure were 4.3 million euro in the first half of 2022.

Operating expenses from continuing operations were 37.1 million in the first half of 2022, of which 67.3% or 25 million were related to R&D.

And the expenses from continuing operations increased by 3.7 million to 25 million in the first half of 2022.

This changed many results from an increase in direct R&D expenses related to programs, notably for lacquer MAB on our proprietary tetra-specific anchors.

EPRT 65.1 and an increase in personal expenses mainly explained by the increase in share-based payments.

General administrative expenses from continued operations decreased by $0.5 million, with $0.5.1 million in the first half of 2022.

I will now turn to Monda for summary of the catalyst and close.

Thank you.

Thank you for the like.

As you can tell, we are working consistently and diligently to execute our strategy across all three key pillars and believe that we are laying the foundation to drive near and long-term value for patients and our shareholders.

Please move to slide 14.

Looking at our clinical program, we expect to achieve a number of milestones over the next two years.

As you heard from Joyce, our phase two telemark study for Lac Courtenay continues to progress. We will start to report preliminary data from this month from the program. In addition, as you know, we are moving our peripheral T-cell lymphoma program into the clinic with initial data expected in 2023. For monoluzumab, the lung cancer trials are underway. We continue to advance the adenosine pathway agent in the clinic where we look...

forward to sharing our phase 2 plans in Jucos.

In parallel, we continue to develop our NCAT technology platform with our partners and OFI, and we are very encouraged by the technical results from our next generation and casellian gauges. We believe that this represents a natural revolution of our platform with data presented at conferences last year. We look forward.

for dates on our proprietary MCAT APA 6501 later this year with the IND on track to be filed next year. Let's move to the conclusion slide.

Lastly, on slide 15, as you can tell, we continue our exciting journey at innate. We look to build our business to create value for patients and stakeholders. And in summary, we have positioned innate pharma for the future with our strategy and made meaningful progress throughout 2021 across all three strategic pillars.

We have carefully managed our resources so we can continue to invest in progress in our pipeline. And I'm very pleased that we continue to have a very strong cash position with a runway into the second half of 2024, with $158 million as of June 30, 2022, not taking into account additional DD milestones. Collectively, we are driving value across our business and ultimately advancing our goal to deliver innovative medicine predictions.

We look forward to keeping you updated on our progress throughout the year. This concludes our prepared remarks. We will now open the call to questions.

As a reminder, to ask a question, please press star, then the number one on your telephone keypad. Again, that's star, then the number one to ask a question.

You can also email IR2 if you have a question.

Your first question comes from Yigal Nechobimas with Citi.

Hi, this is Carly on free is all thanks for taking our questions. We have one on the design of Neo Coast to just clarify the rationale for adding chemo to the combination in the coast to which you didn't have in the coast.

So let me answer the question, is it about the design of the neocost-2 trial and the rationale to add chemotherapy to the combination while the neocost-1 did not include chemo? I think Joyce will provide some explanation.

Go ahead, Joseph, please. Hi, and thank you for the question. Just as a reminder, Neocurse 2 is a trial that is currently being run by AstraZeneca. And currently, they have not provided any further information about the chemotherapy, but it is also to kind of go into the mechanism a little bit about normalism. Normalism is not.

Using the chemotherapy itself as we've seen from the co-study does provide synergy and will enhance the efficacy of normalizing that.

from a mechanistic perspective.

Okay, got it, thank you. And then we also had a question on Interlink. I guess, do you have a hypothesis at this point for why this study wasn't successful? Do you think it could have been a trial design issue? And are there any learnings from Interlink that you and AZ can use as you develop monolizumab and other tumor types? Thank you.

Thank you again for the question. In Chairman Gwen we are looking further into it. Of course it is a large phase 3 and due to that we are kind of really delving deeper into the data to determine if there are any learnings that we can get from the results that we are seeing.

thankyou.

Okay, great. Thanks for taking questions.

Your next question comes from the line of Diana Grebox with SBB Securities.

Hi, thanks for the question. Two for me. Maybe you could give us some more context on the tele-mask like MS readout, I think on September 23rd. Why MS and not also sensory syndrome and the same readout and if you could help you know set any expectations for the amount of patients and the data we should expect there. And then my second question is can you talk a little bit more about.

the preclinical programs that were given back to a night pharma from AstraZeneca. The mechanisms or why those were given back, if it's program specific or sort of an overall strategic collaboration change. Thank you.

So maybe I can start with the first question and then hand it over to you to answer the second question. So in regards to the data, we are – so in regards to the microservices for gratis data, that is going to be released at ERTC. And due to that, we cannot give any more specifics at least around the ventilator, the AtchTrex release. And as mentioned in surgery syndrome, we will be releasing the data in –

selected of the four years ago and as you can imagine in four years many things can change in a big pharma and again it was very early stage but I think we see that we had an opportunity again in the full rights we see that as an opportunity to further develop these programs completely freely or even to partner with the third party but most importantly for our collaboration with AZ which is very

were those being worked on at innate pharma or AstraZeneca?

No, these are, they are actually optioned on program that were developed at NAICS Pharma.

Got it. Thank you.

Next we have a question from the line of Eric the bereguard with stifle.

I will read out Eric's question submitted online. So it's a similar follow-up to the AZ-4. The market looks quite disappointed by the exercise of zero out of the four preclinical assets by AstraZeneca to move forward. Can you tell us how far AstraZeneca went to assess the preclinical assets? Should we think more about a lack of strong enough profile or a visualization exercise by AstraZeneca?

Are you confident? Or are you that some of those will find other partners to move forward?

Thank you, Eric, for the question. So maybe to reiterate what Yannick already said, first of all, AstraZeneca continues to be an important partner and shareholder.

Over the last four years, we made significant progress with assets for which we had proper

development and commercialization agreement with, as you know, Monalzimab, now in phase three and phase two in early stage long, and APH52, after AC39, moving into phase two. The technical option was one of the many collaborations underway. AG had, as you said yourself, a lot of other programs in the way, and you can imagine for a company of that size, they do prioritization of their portfolio on a regular basis. What's really important is enjoying the period.

We have received notice that AstraZeneca will not exercise its option to license those for preclinical programs and this option agreement was part of the 2018 multi-term agreement between AstraZeneca and NATE. There has been no update on the progress since the agreement but as you said now that we regain full rights we can further develop those for preclinical molecules and we will share our plans.

for further development either in partnership or as property assets in Jucus. But I think one important nuance that we need to keep in mind, we're talking about targets here, we're not talking about molecules and assets, it's very very early.

Thank you.

Your next question comes from the line of Nick Hallett with Goldman Sachs.

Just one question on your cash runway guidance in QH24. Can we just clarify if that includes any assumptions around potential acute amount revenues?

or if it includes any proceeds from the HM facility. Thank you.

Thank you for the question. So we are really having a safe approach on that front for the cash runaway calculation. So we do not include the B.D. procedure revenue. That is not fully committed. And as you know if we would do so we would have communicated it to the market.

So we are really having a safe approach on that front for the cash runaway calculation. So we do not include any bidi procedure revenue that is not fully committed and as you know if we would do so we would have communicated it to the market which is not the case so far.

Thank you.

Your next question comes from the mic.

Go ahead, please.

Your next question comes from the line of Olga Smola-Sitzman with Brian Garner.

Good afternoon and thank you for taking my questions. I just want to maybe touch upon neocore's presentation at ASMO. I believe there were sort of more granular data on intratumoral immune activation by DURVA and two combinations. And it sort of seemed like combination with DURVA in general with MONA in general showed broader change in gene expression.

and sort of a regulation of selected genes, including cytoplaxicity, lymphocytic, etc., were higher. So I'm just curious if this provides additional basis to differentiate between dura-aleclumop and dura-mona combinations for you and Astra. And if there were any additional learnings regarding maybe mechanism of action or patient population that might sort of benefit.

from dura-mona combination better. Thank you, Olga. This is a very important question that goes a little beyond the...

that were presented at ESMO a couple of days ago. Before I hand over to Yanis to maybe talk to the granular aspect of this, let me turn to the next speaker. He is a professor

remind everyone that the ongoing phase three trial is testing two hypothesis. One is of course the combination of the monolizumab. The other one is the combination of the JIRA with an anti-CD73. I think there are already some elements that can help eventually differentiate which patient may derive what benefits from which combination. But I think at this point in time it's...

Yes, I think you said it's very right. And like Nader said, the number of patients for which we have the professional data is pretty limited. But it's really, I would say, reassuring and asking from the mechanism of action perspective because we clearly show, and I'm sure you're trying to describe, a very strong immune activation, whether in the duova, olexin M-ARM, or in duova, and to get to a mechanism of arm.

as compared to the GRDA alone. But the numbers are very limited, but what is also important to keep in mind is that this new cost data where I would say monitor after a single cycle of GRDA plus OLE or MONA, whereas in the new cost there would be a multiple cycle plus chemo, a bit like in the CheckMate 816 trial.

So it's really, I would say, an important asking step from the mechanism of action perspective.

Great, thank you.

And then if I may I understand that the results for MS

cohort will be presented soon.

But I'm just curious if you can comment in terms of patients that you're seeing in the study so far and thinking that NF is more indolent type of lymphoma.

Are those kind of having more previous lines of therapy and in general status of MF cohort versus sensory syndrome cohort?

So thank you for the question. So the presentation is going to be at EORTC and unfortunately we cannot comment on the abstract or any of the data within the abstract. We are of course just keeping in mind the enrollment criteria that we have mentioned before.

The NF cohort is integrated in two lines of therapy also and so because of that we are treating later line patients. I'm very similar to the SS where we are also treating later line patients.

Thank you, that's very helpful.

Again, if you would like to ask a question, please press star, then the number 1 on your telephone keypad. You may also email your questions.

Your next question comes from Arson with Kepler.

Hi, this is a question that Arson sent in from Kepler. So first question, what is your development strategy for the KU to now? Are you looking for a partner?

And second question.

I'll let them go first, then I'll ask them second.

Thank you, Arsen, for the question. So, number one, lacuitum herb, as you know, is a proprietary product that is coming from our labs. We're extremely proud that you could, you know, translate the scientific knowledge around this molecule to bring it to the patient, and we are even more excited to see the preliminary results coming out of phase one that led to the decision by the FDA to grant first-hand designation.

It may not be a B idea. We need to validate this first step and I think is a road from duration. We have the first preliminary data camer from the potential potentially pivotal arm and the fillema, to be presented toout the end of the year. So that's, I think, the first step. The second step, and I trually was to expand from there and see whether we can see activity outside.

Cesare syndrome and there's all gets said in less aggressive form of cutaneous tissue cell lymphoma like mycosis pangolides. That's also something that we have disclosed early in the program last year and precisely at the Lugano meeting and we will be providing an update at the upcoming URT-C cutaneous tissue cell lymphoma meeting in Madrid in a couple of days. And of course the next step in cutaneous cell lymphoma is to go into phase C but it's too early to do.

moving forward. First of all because the market is much larger as you know there are close to 20,000 new patient diagnosed with peripalticilin lymphoma every year. About half of them express the Q3-DL2 and of course there is a significant and medical need not only in second line but even in first line there is room for improvement. I think we are the early steps of that development and the readout from the ongoing phase 1b trial that we started and that we announced...

to maximize the opportunity for the asset while bringing capital that you can reinvest into our portfolio.

And then the second question from Arson and Kepler, another question on AstraZeneca, I think a more of a broader collaboration question. So how is your collaboration going with AstraZeneca after the recent failures of the head and neck and the exercise option?

Again, very important question and thanks for the opportunity to reiterate what I said. In the past, AstraZeneca is more than a partner. It's a shareholder and you may remember in 2018 as part of this agreement, AstraZeneca became a shareholder of innate Pharma.

The two assets that are in collaboration with AstraZeneca, which are Monalizumab and APH 52.1, are progressing. Monalizumab is in phase 3, and AstraZeneca is investing, not only in the Pacific Nine trial, but also in a new randomized phase 2 trial called the Neocost 2. This is of course an important signal about their appetite or interest in Monalizumab, of course.

the importance of the collaboration and the relationship within 8-5. And last but not least, as we announced earlier in the year, they took the decision to move APH-6201 and anti-CD39 into Phase 2. Despite the fact that they have progressed already, the ACD-73 and Phase 3, they are still interested and involved in the development of our anti-CD39. I mean, these are two very strong signals.

that can tell you about the relationship and the collaboration that we have with AstraZeneca. The fact that we have a negative readout from Interleuk1, it's part of our business in the U.S.

Drug development, you have, you know, ups and down and I think we both have fori. And as to the risk to explore the potential or of monolizm, up in had the nextck anscer. The fertility analysis told us that this may not be the best way. But as you jsen said, I think we need time to D just and look at the totalility of the data and see what we can learn from these preliminary results. But it does not really put into question the whole.

they have to conduct on a regular basis.

Your next question comes from Jane Main at Evacore.

Hi, this is an online submitted question. Can you comment on the amount of potential milestones from AstraZeneca tied to non-small cell lung cancer? Thank you.

Yeah, actually we did not disclose the breakdown of the milestone. We, maybe just to remind you, the total amount of milestone of the deal is $1.2 billion. We already cashed in $450 million. The last two milestones that we disclosed were for patients in phase three. We get $50 million for the first phase three, $50 million for the second phase three. And we still, I mean, there is a total of 400 in regulatory.

your participation to this call. As I said in my concluding remark, we continue to consistently execute our strategy and make sure that we create value short term. We'd like to come up and we are very excited to see that this work is coming to the light now and we will be presenting data in the second half of this year.

excited by the progress of Monologemab in early stage and concern. We look forward to update you also on the APH-6201 phase two program that we announced. That's not the least. We have a very strong cash position and a cash runway into the second half of 2024 which of course will allow us to execute our strategy and create value as I said for patient and shareholder. Thank you. Have a good day.

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How I.