Q3 2022 Shattuck Labs Inc Earnings Call
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Good afternoon, and welcome to the Shaddock Labs third quarter 2022 earnings Conference call.
At this time all participants are in a listen only mode. Later, we will conduct a question and answer session introductions will follow at that time.
As a reminder, this conference is being recorded.
I will now turn the call over to your host Kannan Richardson Senior director of Finance and Investor Relations at Shadow Labs Conor. Please go ahead.
Thank you operator.
Good afternoon, everyone and welcome to the Shaddock Labs conference call regarding our third quarter 2022 financial results and recent business updates the press release reporting our financial results.
After market close this afternoon and can be found on the events and presentations section of our website Shaddock labs dot com.
During this afternoon's call is Shaddock leadership team will provide a business overview of the third quarter of 2022 including clinical development updates from S. L. One seven to one five for our lead program and S. L 279 to five two.
We will refer to these as 154 and 252 throughout todays earnings call.
On today's call will be our Chief Executive Officer, and scientific co founder Dr. Taylor Schreiber, who will review our pipeline progress and upcoming key milestones followed by our Chief Medical Officer, Dr. <unk>, <unk>, who will provide an update on our clinical activities and then.
Our Chief Financial Officer, Andrew Neil will review, our third quarter 2022 financial results and financial guidance.
We will then open the call for questions. After doctors driver makes some closing remarks.
Before we begin I would like to remind you that today's webcast contains forward looking statements within the meaning of the safe Harbor provisions of the private Securities Litigation Reform Act of 1995.
Such statements represent managements judgment as of today and May involve risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by these statements.
For more information on these risks and uncertainties. Please refer to our most recent annual report on Form 10-K for the year ended December 31 2021.
In our other filings with the SEC, which are available from the SEC's website or on our corporate website <unk> com.
Any forward looking statements represent our views as of today November eight 2022.
With that I will now turn the call over to Dr. Schreiber, Our Chief Executive Officer Taylor.
Thank you Conor and good afternoon, everyone and thank you for joining us today.
2022 has been an operationally focused year for <unk> and our clinical team has done an excellent job of advancing $105 for our lead clinical stage agonist redirected checkpoint or arc compound.
As a reminder, <unk> is a surf Alpha FC CD 40, ligand bifunctional fusion protein, which serves to both block the macrophage checkpoint molecule known as <unk> 47, and also activates.
Horton immune stimulatory receptor known as <unk> 40.
Linking these two functions within a single therapeutic differentiates 154 from all other CD 47 inhibitors in clinical development.
As you will hear from Dr. <unk> in a moment our clinical team has made excellent progress and we completed enrollment in the monotherapy dose escalation portion of our phase one trial for patients with advanced platinum resistant ovarian cancer in the second quarter of this year.
One 504 reached a maximum administered dose of 10 milligrams per kilogram, which was the highest anticipated dose level in the study.
In the third quarter, we began enrolling patients in the first chemotherapy combination cohort in ovarian cancer and we have selected three milligrams per kilogram as the starting dose level for $1 four in this combination cohort.
As for the chemotherapy combination agent, we selected the combination with lysosomal doxorubicin, because preclinical studies demonstrated that ovarian cancer cells Express pro phagocytic or eat meat proteins on their surface following exposure to <unk> doxorubicin.
These eat me signals are essential to initiating an anti tumor response in the setting of CD 47 inhibition.
In addition, several decades of clinical experience in the platinum resistant ovarian cancer setting has established a single agent response rate in the range of 10% to 12% for liposome will doxorubicin.
Thus this trial design allows us to decipher the contribution of components with a relatively small number of patients.
In addition to our clinical development program in solid tumors. We began a clinical study for 154 for patients with acute myeloid leukemia and higher risk Myelodysplastic syndrome in the second quarter of this year and we expect to enroll patients in the first combination cohort with Asus siding in the fall.
Quarter of this year.
Patients enrolled in the dose escalation cohorts will primarily have relapsed refractory disease and any complete responses in this patient population with differentiate <unk> from other CD 47 inhibitors in this patient population.
The subsequent planned expansion cohorts will then enroll patients in the frontline setting where the activity of first generation $3 47 inhibitors has narrowed in recent updates and left significant room for improvement.
We believe that one platform may differentiate with the addition of CD 40, agonism to CD 47, blockade, which may lead to improved response rates and increased durability.
Our second clinical stage compound to <unk> to a PD one FC Ox 40 ligand bifunctional fusion protein is in phase one development for patients with advanced solid tumors and lymphomas.
We are continuing to enroll patients with primarily PDL one selected tumors at the top dose level of 24 milligrams per kilogram and topline data from the phase one dose escalation trial are anticipated in the first quarter of 2023.
<unk> preclinical pipeline, we've made tremendous progress over the past quarter with multiple publications on our preclinical arc and Gatland programs in the journal of immunology, which can be found on our website.
Interest in harnessing the activity of Gamma Delta T cells in cancer has continued to build and we believe our gatlin platform is truly distinct from all other approaches currently in development due to its unique design features.
Our team has uncovered and published some of the key aspects of Gamma Delta T cell biology, which will guide our clinical strategy and additional preclinical data will be presented at the society for immunotherapy of cancer Annual Conference later this week in Boston.
Gatland platform is highly modular and is amenable to mono specific by specific and buy parrot topic design and data from two separate product candidates one targeting the CD 20 antigen and another targeting the <unk> 700, <unk> three antigen will be included in the <unk> presentation.
The CD 20, Gatland has completed a dose range finding toxicology study in non human primates and is being considered as a non <unk> based b cell depleting therapy for antibody driven autoimmune diseases.
<unk> III guideline is being considered for a variety of solid tumor indications where single agent efficacy would be expected.
We look forward to sharing more data as the gamma Delta T cell therapy space continues to advance.
With that I will now turn the call over to Dr. <unk> <unk>, our Chief Medical Officer Lenny.
Thanks, Dana and good afternoon.
I'm extremely pleased with the execution of our clinical program and the progress we have made throughout the year.
Let's turn first to one side for a differentiated CD 47 inhibitor mcd agonist offer.
Our first clinical trial of <unk> four is a multicenter open label dose escalation trial intended to assess the safety Tolerability pharmacokinetics antitumor activity and Pharmacodynamic effect of intravenous administration of 154 as monotherapy in patients with <unk>.
Platinum resistant ovarian cancer.
Initial clinical data from this trial presented at 52021 demonstrated a favorable safety profile high target occupancy and on target Pharmacodynamic activity.
By CD 40 activation.
As you may recall from the last quarter, we announced that we had completed enrollment in the maximum administered dose level of 10 milligram per kilogram.
To date, we have not offset any evidence of destructive anemia, which we attribute to the design of the FC portion of behind pipe <unk>.
And the absence of binding to FC Gamma receptors.
We believe that the current safety profile at <unk> provides us with a therapeutic window in which we can potentially maximize the biology of CD 40, while reaching near 100% target occupancy of CD 47.
We expect to report the first data from the dose escalation portion of this trial.
Yes 2023.
And this is by our progress in the phase III trial I'm pleased to see that in the third quarter of DCF, We dosed our first patient in a phase one clinical trial of <unk> four in combination with lysosomal doxorubicin in patients with platinum resistant ovarian cancer.
This multi center open label trial is intended to evaluate the safety Tolerability pharmacokinetics antitumor activity and pharmacodynamics of 154 in combination with like the Soma boxes listing.
We expect to report initial combination data from this trial midyear 2023.
Now, let us turn our attention to slide four clinical trials in hematologic malignancies, where I'd like to highlight the progress we have made in our phase one <unk> clinical trial in AML and higher risk Mds.
In this trial evaluating the safety Tolerability pharmacokinetics anti tumor activity and Pharmacodynamic effects of Wi Fi <unk> as both monotherapy and in combination with <unk>.
As a reminder, the first part of this trial is a parallel staggered monotherapy and combination dose escalation in heavily pre treated relapse refractory patient population that few if any agents have consistently led to complete responses as Dan alluded to this is an area that any color.
Pete responses could be a differentiating signals, particularly to impact other CD 47 agents.
I am pleased to report that enrollment in the monotherapy cohorts of this trial has progressed nicely and as a result enrollment in that is affected in combination cohort is expected to begin in the fourth quarter of 2022.
Initial dose escalation data from the monotherapy and <unk> combination are expected in the first half of 2023.
Our second clinical candidate <unk> <unk> is in a multicenter open label clinical trial evaluating the safety Tolerability pharmacokinetics antitumor activity and pharmacodynamics up to five two in patients with advanced solid tumors and lymphoma.
As you will recall, we have previously reported initial data through six milligrams per kilogram from the ongoing phase one dose escalation clinical trial, demonstrating evidence of antitumor activity and dose dependent pharmacodynamic activity.
We have completed enrollment in the 12 milligram per kilogram cohort and anticipate completing enrollment in the 24 milligram per kilogram cohort in the fourth quarter of this year as a result and to allow for response assessment in these patients we expect to chef top line data from the additional cohorts.
In the first quarter of 2023.
As we have discussed before the PD one landscape has evolved in such a way that enrolling patients.
Both PD, one naive and at the high likelihood at this funding to PD. One inhibition is extremely difficult in nearly all geographies around the world.
As such the clinical path of 205, two would first be in PD, one relapsed refractory patients.
We would need to see a 20% or greater overall response rate in the addition of patient cohorts to see a viable path forward for 252.
With that I will now turn the call over to Mr. Neal to discuss our financial update Andrew.
Thank you Lynn good afternoon, everyone.
As Conor mentioned at the outset of our call the full financial results for the third quarter of 2022 are available in our earnings press release and in our forthcoming 10-Q.
Today, I would like to focus on a few key points from our disclosures, we continue to be well positioned financially as.
As of September 32022, we have cash and cash equivalents and investments of approximately $185 1 million.
In the third quarter of 2020 to our research and development expenses were $18 9 million compared.
Compared to $15 1 million for the third quarter of 2021.
In the third quarter of 2022, our general and administrative expenses were $6 6 million.
Compared to $4 3 million for the third quarter of 2021.
Our net loss for the third quarter of 2022 was $24 $6 million were a loss of <unk> 58 per basic and diluted share compared to a net loss of $17 4 million for the third quarter of 2021, or <unk> 41 per basic and diluted share.
Based on our current operating and development plans, we reiterate our financial guidance for 2022 and beyond.
We expect our existing cash and cash equivalents and investments to be sufficient to fund our planned operations into the second half of 2024.
We continue to operate with strong financial discipline across our entire company, including in our ongoing clinical programs and given our projected rate of cash burn we are in a healthy position as it relates to our balance sheet and expected clinical data readouts for our 154 and <unk> two clinical trials.
With that I'll hand, the call back to Dr driver for final comments Taylor.
Thank you Andrew.
Do you have just heard 2022 has been a year in which we have kept our heads down to focus both on clinical execution with the arc platform and further broadening our pipeline with the gatlin platform.
Both of those opportunities are now ripening quickly and we are pleased to be approaching key clinical data in 2023.
As you heard from Lenny clinical updates from the one 504 program, including complete data from the monotherapy dose escalation study in platinum resistant ovarian cancer patients and initial data in combination with lysosomal doxorubicin also in ovarian cancer patients are expected mid year 2023.
Additionally, initial data from our study in patients with relapsed refractory AML and higher risk Mds are expected in the first half of 2023.
I want to thank everyone for participating in today's call.
We believe the combination of our experienced team transformational science and protein engineering as well as financial resources puts us in an incredibly strong position to move beyond our next set of milestones.
We will keep you apprised of our progress as we continue to execute our strategic and corporate objectives.
With that we would now like to open the call for your questions operator.
Okay.
At this time I would like to remind everyone to ask a question. Please press <unk>.
Number one im sorry star and the number one on your telephone keypad.
Our first question comes from Marc Frahm with Cowen.
Hi, Thanks for taking my question.
Last quarter your lesson you spoke.
On an earnings call.
Talked about the three milligram dose being advanced into the docs will combo trial.
It seems unlikely that the 10 milligram, while still being pursued in the monotherapy whats going to need to be ported over do you have enough data now from the <unk>.
From that cohort in the mono therapy to confirm whether you think you will or will not be using the 10 milligram dose in the combo at all.
Hey, Mark Thanks for the question, let me ask Lenny to take that.
All our PK PD analyses support the 10 milligram per kilogram dose being evaluate that needed a combination.
Political allows us to go up on the dose by the three mid again is a very solid.
Sorry evaluation and combination.
Okay. Thanks, that's helpful and then.
Also in the early experience with monotherapy and there were some infusion reactions.
You extended the dosing time to help with that.
Update us on kind of how thats going to continue to evolve.
And can you confirm are using the longer infusion time in the combo trials.
Yes, we are using.
In a longer infusion time, which is two hours over to Lubbock and stood up over one another.
Okay. Thank you.
Thanks Mark.
Our next question comes from Jon Miller with Evercore ISI.
Mr. <unk> your line is live.
Okay.
Hi, This is Eric you're asking on for John Miller.
154, looking at the monotherapy trial in platinum resistant ovarian cancer.
This is Taylor you trailed off there.
Could you repeat the question.
Operator, maybe we can go to the next question and come back to Evercore.
Absolutely. Our next question comes from Gil Blum with Needham <unk> company.
Hi, Good afternoon, everyone. Just a quick question on the 10 Meg to pick dose.
Was there any sign off toxicity at that dose are purely this is.
A decision based on PK PD.
Hey, Joe I'll turn that over to linear as well, yes. Its a decision based on PK PD. We did an analysis across all the doses of anti dose range and attainment against per kilogram dose.
Get fully receptor occupancy.
On target Pharmacodynamic activity and it is.
Very good dose actually to take Paul but.
There is not much that you gain from going up to 10.
Okay, that's very helpful.
Maybe a speculative one do you guys have any view on kind of the abstracts that were published for Nikola map ahead of Ash I mean, I'm sure you guys looked at it it doesn't it doesn't look like there is not much more benefit for <unk> 47.
High risk Mds I would appreciate any thoughts you guys have.
Yes, so I'll start and Linda you may want to chime in with some additional comments I think.
Recently, we've seen some updated abstracts, both from Alex and more macro heading into ash.
With both I guess, what I would say to caveat my response is that.
There is not quite enough detail in the abstracts too.
To make a full assessment of.
The patients that.
We are.
In each trial and what it necessarily means.
And.
The other statement that I would make is that.
I think the trends toward.
The activity of <unk> 47 inhibitors at least single acting CD 47 inhibitors.
Being most convincing in the <unk> mutant AML population.
Is where we believe the field will continue to.
Evolve.
And.
The activity.
Hey decided in alone in the non <unk> 53.
HR Mds patients and then the combo between Asia and then in the non <unk> three mutant AML.
I think it's.
So far the data we've seen is really on the margins.
As to whether.
A single acting CD 47 inhibitor adds something beyond what you would expect from that chemotherapy only backbone.
Alright.
I appreciate the color and I'll step back in the queue. Thank you.
Thanks, Kevin.
Our next question comes from Eagle note to move it.
With Citi.
Hi, This is carly on for Yigal. Thanks, so much for taking our question.
Just had one on that the 154 update for AML and Mds in the first half of next year.
I guess can you comment at this point on roughly how many patients we should expect for <unk>.
The monotherapy and the combination cohort.
I know you mentioned in the prepared remarks that ticked up like any complete responses in this population would be meaningful but can you elaborate a bit on sort of what.
You are looking to see what is it eight in combo specifically.
Thank you.
Great. Thanks, So I'll ask you to take that also yesterday, so dose escalation part. So there is a monotherapy dose escalation and then there is a combination with Dave decided in dose escalation and so we anticipate anything between 10 and 20 patients.
The.
The dose escalation.
And then your second question dislodging some keeps emissions so.
In the relapsed refractory patient population institutionally.
Unusual to see some fleet emissions in that patient population.
So it would be but just see any complete commission that would be differentiating for this agent.
Okay got that.
Helpful. Thank you and next we just had one quick clarification question also I think.
Previously you also planning.
To do a combination.
The net of clash with the illustrated in budget, but it looks like now you might be just doing a facility could you just clarify if there was a change and what the what the reason was.
Yes, so the dose escalation is with data <unk> once we get to a dose of Azacitidine and one side Paul.
That is.
Expansion cohort in combination with <unk>.
<unk>.
And we need to plan.
Okay.
Bonnie followed by an expansion into the safety run in followed by an expansion.
Okay, great. Thank you very much.
Thank you.
Yes.
At this time I would just like to set as a reminder to ask a question. Please press Star then the number one on your telephone keypad.
Our next question comes from Cavalry Coleman with BT IAG.
Yeah. Good afternoon, Thank you for any updates.
One four.
You talk about how the approach is different from Iot for targeting which are also re polarize of macrophages.
Mark you have expanded into the space with multiple tumor types, including urea in cancer.
Sure.
<unk>.
This is the CD 47 axis addresses.
Addresses a particular aspect of macrophage biology.
Which enables macrophages to consume or phagocytose tumor cells that are in their proximity.
And so that activity in and of itself is not an activity that is directly addressed by <unk>.
Something like an IL four specific agent.
There are.
A number of a number of ways to influence the polarization of macrophages.
Some macrophages can be immune inhibitory some macrophages can be immune stimulatory.
And.
Certainly Iot for can play a role in that decision.
Interestingly CD 40.
It does as well.
When you stimulate CD 40 on a macrophage it helps guide that cell.
Toward that immune stimulating M. One phenotype.
And so I believe that an agent like one 504 addresses.
On the CD 40 side a somewhat similar.
Aspects of macrophage biology, as some of the Iot for agents.
The CD, 47% inventory part is purely a pro phagocytic.
Function.
Yes.
That's very helpful. Thank you and for AML any thoughts on combining it with cytarabine because these on the ovarian cancer data the safety profile looks benign enough alright.
As might have been two immunosuppressive.
Okay.
So the dose of sites that have been.
And that is also it is immunosuppressive.
You said, so you could actually deplete the sales that youre trying to debate.
Got it and maybe last one on.
Gallon, you multiple programs, where our cabinet and Lynn.
And then Tom I would like be 73.
Could we use with several indications.
Yes my question.
Alan a potential partnering opportunity or do you ultimately have aspiration to rally independently develop both Oregon Gatineau market.
It certainly could.
The gatlin platform is quite broad and B seven inch three is just one of the agents that we have in our pipeline.
These days and we think it's a compelling one being <unk> three is an added tumor antigen thats widely expressed.
Daiichi Sankyo has recently shown some interesting data was one of their programs targeting <unk> three.
I think again, the delta engage or could offer something thats distinct.
From what an antibody drug conjugate type molecule can offer.
And a number of tumor types.
So two tumors that are interesting from a <unk> three expression standpoint, where gamma Delta T cells are also relatively abundant.
Include tumors like melanoma, and non small cell lung cancer bladder cancer, a number of others.
So for now we're.
Proceeding along with the development of this agent toward IND.
Yes.
So I'll just leave it at that for now.
Yes.
Makes sense, thanks for taking my questions.
Thanks, Kevin.
And our last question comes from <unk> Shah with Baron Burger.
Great. Thanks for taking my question.
I have a few so first one on.
One slide four.
Are you willing to discuss.
More details around the 30 Meg per kg dose.
Okay.
PPD.
Dynamic Sir.
Alright.
Is it a call last year around this time.
Thanks have changed and again thank.
If you're willing to discuss.
Okay got it.
Yes.
Sure.
So I'll start and then when he can fill in any of the gaps if I missed them.
So the thing you might remember from our prior conversations that.
What we were hoping to achieve.
Over the course of the monotherapy dose escalation study was to identify a dose where.
154 was well tolerated.
The CD 47 was fully saturated where <unk>.
<unk> 40 was fully saturated.
And where the Pharmacodynamic effects that we attributed to CD, 40, biology, where maximal and had achieved a maximal plateau.
We shared some of that data in the <unk> presentation in the types of things that we see.
As a consequence of CD 40, finding include the rapid migration of <unk> expressing b cells and monocytes out of the blood within an hour or two of infusion as well as <unk>.
The impressive inductions of a number of CD 40, driven cytokines in the peripheral blood.
And when we moved from the three to 10 milligram per kilogram dose. We were fundamentally we knew that we were at saturation of CD 40, and <unk> 47, and we're starting to see large spikes in those cytokines and near maximum Margination of CD 40, expressing cells by three mix per kg.
And so fundamentally what we were asking us when we go to 10 do we see.
A further potentiation of those pharmacodynamic effects.
Stabilization in Maxwell plateau of those effects or a reduction in some of those pharmacodynamic effects. Many of you likely are aware that with the CD. Other CD 40 agents you see this odd bell shaped dose response curve that indicates that it might be tough to maximally drug the pathway.
What we saw from three to 10 is that all of those pharmacodynamic effects remained at a maximal plateau.
And so as Lenny alluded to before.
And looking at between that three and 10 milligram per kilogram dose there wasn't any discernible.
Benefit based on those endpoints to continue.
With the 10 Meg kicked dose.
Great. That's helpful and then second question.
Around.
The combination shortly.
A new sensor.
ADC ethane.
As disclosed last time.
Listed on <unk>.
Charles Dot Gov.
Given your update today I'm wondering if you're willing to discuss.
Yeah.
Sure so.
First of all were.
Yearly awaiting.
Hopefully an accelerated approval for <unk>.
By Immunogen any day now.
It is an exciting opportunity for <unk> for patients with platinum resistant ovarian cancer that haven't had a new therapy available to them, it's quite a long time.
And one of the interesting things about <unk> is that.
The label is expected to be at least initially in patients that express very high levels of fully receptor alpha on their tumors, 75% or greater.
But along the way immunogen has seen tumor shrinkage.
And about 80% of patients or so with lower levels of fully receptor alpha expression.
Starting at about 25%.
And it really begs the question could the durability it could that initial tumor shrinkage lead to greater durability. If it was combined with something that.
Potentiate at that initial tumor, killing signal that that <unk> clearly delivers.
And that's exactly where we see an opportunity for a drug like 154.
And.
I think I need to sort of leave it there until we hopefully get news of the accelerated approval and then we'd love to continue that conversation.
Great.
And our final question.
Turning to slide two.
You are still dose escalating.
Good drug and we'll provide updates.
Chris.
Question on the industry.
I Wonder should we so.
Operating under the assumption that you are not.
<unk> seen 20% of our.
This program.
Thank you Dan.
Yes that should be your operating assumption.
Yes.
Okay, great. Thanks very much.
Thanks Lee.
That concludes the question and answer session I will turn the call back over to Taylor Scribing.
<unk> Chief Executive Officer of Shaddock Labs.
Thank you. This concludes the Q&A session of the call. Thank you operator. Thank you all for joining Schaddick labs third quarter financial results and business update conference call. We appreciate your continued interest in <unk> and we look forward to updating you on our milestones throughout the remainder of 2022. Thank you.
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Yes.
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