Q3 2024 Cellectis SA Earnings Call
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Speaker Change: Good morning, everyone, and welcome to the Solitics 3rd Quarter 2024 Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time.
Speaker Change: Please be aware that today's conference call is being recorded. I would now like to introduce the first speaker, Arthur Stril, Chief Financial Officer. You may begin.
Speaker Change: Good morning and welcome everyone to Selective's 3rd Quarter 2024 Business Update and Financial Results Conference Call. Joining me on the call today are Dr. Andr Choulika, our Chief Executive Officer, and Dr. Adrian Kilcoyne, our Chief Medical Officer.
Arthur Stril: Yesterday evening, Selectus issued a 6K and press release reporting our financial statements for the nine-month period until September 30, 2024, and a business update. The report and press release are available on our website at Selectus.com.
Speaker Change: As a reminder, we will make statements regarding Selecta's financial outlook, including the sufficiency of cash-to-fund operations, in addition to its manufacturing, regulatory, and product development status, as well as product development status of its licensed partners.
Speaker Change: These forward statements, which are based on our management's current expectations and assumptions,
Speaker Change: and on information currently available to management.
Speaker Change: including information provided or otherwise publicly reported by our licensed partners.
Speaker Change: are subject to risks and uncertainties that may cause actual results to differ from those forecasted.
Speaker Change: A description of these risks can be found in our most recent Form 20-F filed with the Security Exchange Commission, SEC, and a financial report, including the management report, for the year ended on December 31, 2023, and subsequent filings Selectus makes with the SEC from time to time.
Speaker Change: I would now like to turn the call over to André.
Andre: Thank you, Arthur. Good morning, and thank you, everyone, for joining us today. This quarter, we're excited to announce that research and development activities have started for three programs developed under our collaboration and research agreement with AstraZeneca.
one allogenic CAR-T for metallurgical malignancies, one allogenic CAR-T for solid tumors, and one in vivo gene therapy for genetic disorders.
Andre: Electus is thrilled to have this strategic collaboration with one of the most impressive pharmaceutical companies of the past decade, AstraZeneca.
Andre: Together, we continue to advance our ambition in cell and gene therapy, bringing potentially life-saving therapies to patients with unmet medical needs.
Speaker Change: In the coming months, we will continue to focus on the enrollment of patients in our core clinical trials.
Speaker Change: These programs are key for the company, and in order to focus our resources toward success, we decided to de-prioritize the development of Fucar T123, evaluated in relapsed refractory acute myeloid leukemia.
Speaker Change: We strongly believe that gene-edited cells and gene therapies are revolutionizing medicine across a number of therapeutic areas and will become a large part of molecular medicine of the future.
Speaker Change: With that, I'd like to turn the call over to Adrian Kilcoyne, our newly appointed Chief Medical Officer.
Speaker Change: We're thrilled to welcome Adrian to SelectUS. He's a strategic, forward-thinking drug developer who is passionate about delivering life-saving therapies to patients.
Speaker Change: He joined us at the pivotal time bringing extensive experience in drug development as we are progressing in our co-clinical programs. Adrienne will give an overview of her clinical trials. Adrienne, please go ahead.
Adrienne: Thank you, Andre. As Andre mentioned, SelectUS continues to focus its development efforts on the BALI-01 and NAFLI-01 studies.
Speaker Change: While we will deprioritize the AMEL-E01 trial assessing UCART 1, 2, 3 in relapsed refractory acute myeloid leukemia,
Adrienne: This study has provided important insights into the role of CD123-targeted allogeneic CAR-T therapy in the treatment of AML and will inform the future development of our allogeneic CAR-T platform.
Adrienne: Recruitment in BALI-01, a study evaluating UCAR-22 in relapsed refractory B-cell acute lymphoblastic leukemia, has progressed well. We have now completed patient identification for all remaining open slots in the BALI-01 study to reach a total of 40 subjects treated.
Adrienne: As there is no longer a requirement for subject staggering, the remaining patients are being dosed concurrently.
Adrienne: Therefore, we expect the Phase 1 dataset to be available in 2025. We are currently planning our regulatory interactions in support of our potential Phase 2 strategy.
Adrienne: Thank you. Thank you. Thank you.
Adrienne: We also continue to enroll in the NAFLI-01 study of our dual CAR-T acid, UCAR-2022, in relapsed refractory non-Hodgkin's lymphoma. This study is addressing an important unmet need for patients who have relapsed following multiple lines of therapy, including, when available, an autologous CD19 CAR-T.
Speaker Change: As Andre mentioned previously, we will endeavor to share the data for the Phase I program in 2025.
Adrienne: With that, I would like to hand the call over to Arthur Stril, Selectus' Interim Chief Financial Officer, for an overview of our financials for the third quarter of 2024. Arthur, please go ahead.
Arthur Stril: Thank you, Adrian and Andre.
Arthur Stril: We are excited about the progress of our partnerships, which are positively impacting our financial position.
Arthur Stril: In particular, $47 million have been triggered so far under the AstraZeneca Joint Research and Collaboration Agreement, of which $25 million up front and $22 million reached development milestones,
Arthur Stril: in addition to reimbursement of research costs incurred.
Arthur Stril: In our financials, the cash, cash equivalents, restricted cash, and fixed-term deposits classified as current financial assets as of September 30, 2024 amount to $264 million.
Arthur Stril: compared to 156 million dollars as of December 31st, 2023.
Arthur Stril: This $108 million increase is mainly due to $140 million cash received from AstraZeneca as part of the second tranche of its equity investment in Selectus.
Arthur Stril: $16 million cash received from the European Investment Bank, EIB, pursuant to the disbursement of the €15 million Strange B under the finance contract with EIB.
Arthur Stril: $8 million of cash in from our financial investments.
Arthur Stril: $27 million of cash-in from our revenue.
Arthur Stril: Partially offset by cash payments from selectives to suppliers of $42 million, including $30 million to R&D suppliers and $12 million to SG&A suppliers.
Arthur Stril: Selectus wages, bonuses, and social expenses paid of $32 million, the payments of lease debts of $8 million, and the repayment of the PGE loan of $4 million.
Arthur Stril: You're invited to refer to our press release for figures related to consolidated net loss attributable to shareholders of Selectives for the nine months ended September 30, 2024.
Arthur Stril: The company believes that its cash, cash equivalents, and short-term deposits as of September 30th, 2024, will be sufficient to fund its operations into 2027.
Arthur Stril: We have been able to extend our cash runway through a combination of milestones received from the progress of our partnerships, as well as prudent cash management for our wholly owned R&D pipeline and controlled SG&A expenses.
Arthur Stril: We are focusing our span on developing our clinical product candidates UCAR 22 and UCAR 20x22, potential new product candidates, and operating our end-to-end cell and gene therapy manufacturing facilities in Paris and Raleigh.
Arthur Stril: Research costs under the AstraZeneca collaborations are funded by AstraZeneca.
Speaker Change: And now, I would like to turn the call over to André for closing remarks.
Andre: Thank you, Arthur. To close out this call, I would like to reiterate that we are confident about the continued progress of our ongoing clinical trials in pathological malignancies.
Andre: as well as how excited we are about our strategic collaboration with AstraZeneca.
Andre: At Selectus, we strongly believe that our product candidates, our technologies, and our in-house manufacturing capabilities will lead us and our partners to paradigm shifts for patients with hard-to-treat cancers and genetic disorders.
Andre: positioning us at the forefront of this promising medical and scientific field.
Andre: Moving forward, we have an important information to share for the future.
Andre: The company has decided to hold calls only when there is significant information to discuss.
Andre: or if there is a key update or business activities. We invite you to refer to our press releases for quarterly earnings and remain available to address any questions you may have.
Andre: In the meantime, selectives will participate or organize calls or in-person events outside quarterly calls to update you about our progress.
Andre: With that, I would like to open the call for Q&A.
Speaker Change: And at this time, if you would like to ask a question, please press the star and 1 on your telephone keypad. You may withdraw your question at any time by pressing star 2.
Once again, to ask a question, please press the star and 1 on your telephone keypad.
Speaker Change: We'll take our first question from Jenna Wang with Barclays. Please go ahead, your line is open.
Speaker Change: Well expectation wise, indication wise, you know. The previous activity was able to hold.
Speaker Change: So that's the number of patients we would anticipate to be able to share in 2025.
Speaker Change: Obviously that's part of the dose escalation and we're currently, as I mentioned earlier, at a phase where we no longer require staggering. So we would anticipate these last patients to be completed at a greater pace, as you would expect within this CAR T space. So again, 40 patients in 2025.
Speaker Change: In regards to UCART 123, you're absolutely correct. We've seen some really good signals with this target within AML. However, we have a responsibility to ensure that we have
Speaker Change: the best use of our cash and we prioritize the key assets. So we're prioritizing the assets that we believe gave us the highest chance of success.
Speaker Change: and that's why we have focused on Natalie and on Bally. That's not to say we don't believe there's a place for this therapy within the AML setting, we just have to prioritize what we can achieve with our runway. We have to optimize our runway.
Special thanks to Peter Beetham, Mark Stril, Rory Riggs, Rory Riggs, Rory Riggs, Mark Stril, Andr Choulika, Rory Riggs, and Peter Beetham.
Speaker Change: Okay, thank you.
Speaker Change: Thank you. Our next question comes from Jack Allen with Bird. Please go ahead. Your line is open.
All right, thanks for much for taking the questions and congratulations to the team on progress and Adrian for the new role
Jack Allen: A couple from us. I guess first on UCAR-22, Adrian, you mentioned that you're now enrolling patients in parallel. How should we think about the
Speaker Change: So, great question. We know that with any allogeneic therapy...
Speaker Change: You know, we do question persistence a lot, durability a lot, and that's where our ongoing conversations with the regulatory authorities are focused. What is the right indication? What is the right patient group? So absolutely, when we announce this data, we'll be announcing it in terms of durability response and our regulatory approach, which hopefully will make a lot of sense when you hear that later on in 2025.
Speaker Change: I missed the second question, sorry, could you repeat it?
Speaker Change: Yeah, thanks so much for that, Caller. And then just on 20x22, how should we think about the breadth and depth of that data set as we look at on 2025?
Speaker Change: Yeah, we aren't as advanced in 2022 as we are with 22. We still have fewer patients. We are, however, we're in a position where there's a lot of demand. And I would say across 22 and 2022, there's a lot of demand for patients in this study. So we would anticipate relatively brisk recruitment. We know that this is a far more common disease, but we do have waiting lists for slots in both of these studies. So I would anticipate we will have a pretty robust data set by 2025 to share with you.
Speaker Change: Got it. Thank you so much, and then maybe just one more if I could on the financial side
Jack Allen: Arthur, I was hoping you could talk a little bit about the evolution of revenues from the AstraZeneca deal.
Jack Allen: Forgive me, I believe the number is about 34 million in revenues to date. Is that primarily from AstraZeneca? And how should we think about the fourth quarter with the disclosure of a number in the 40s of accrued revenues realized as it relates to milestones from AstraZeneca?
Arthur Stril: Yeah, thank you so much, Jack. Great question. So, just by way of reminder, so the AstraZeneca collaboration allows for up to 10 cell and gene therapy programs.
Speaker Change: We're very happy to have already initiated three. And so I think what we wanted to report is really the number of milestones and up-front that have been triggered.
Speaker Change: which have a direct impact on our cash position, which by the way is one of the reasons why we're now able to get a cash guidance to 2027 as opposed to 2026 previously.
Speaker Change: The reason why the revenue numbers differ is through the accounting treatment of revenue. Some of this revenue is capitalized and...
Speaker Change: and recognized over time as opposed to recognized as a one-off item. And so you will always see some slight discrepancies between the revenue numbers and the actual milestones that are triggered. This is why in the press release we want to focus more on the milestones that have been hit.
Speaker Change: And if you want more details, I invite you to refer to our 6K, which gives a bit more detail as to the accounting treatment of revenue.
Speaker Change: Thanks so much for the call, and congrats on the progress.
Arthur Stril: Thanks.
Speaker Change: Thank you. Our next question comes from Yigal Nokomovits with Citi. Please go ahead.
Arthur Stril: Hi team, this is Ashik Mubarak on VGAL. Thanks for taking my questions. For Bally 01...
Ashik Mubarak: You alluded to 40 subjects being in the dose escalation phase, and that's the data set we'll see. I'm just wondering where you are in thinking about dose expansion and dose selection.
Ashik Mubarak: Is that pending, sort of, phase two regulatory interaction? And for that regulatory interaction, what are some of the key questions you're hoping to get some clarity on? Thanks.
Speaker Change: Yes, you're correct in your assumption. We are looking at the right approach to our phase two expansion study, right through to our
Speaker Change: a complete regulatory path.
Speaker Change: So we're being very careful in terms of our choice of endpoints.
Arthur Stril: because we believe that allogeneic therapies are unique and therefore they require a very thoughtful approach in collaboration with the regulatory authorities as to what the right endpoint is for these patients. We believe we know the position we're going in now, but again, we look forward to sharing more information with you in 2025.
Arthur Stril: Thank you very much.
Arthur Stril: Thank you.
Speaker Change: Thank you. Our next question comes from Yaman Zhu with Wells Fargo. Please go ahead.
Speaker Change: Hi, this is Kwan Ong for Yannan. Thanks for taking our questions. So I have a question on Bali.
Speaker Change: Sorry, Natalie Owen, do you continue to see your in-house products performing better than the CMO products? And any safety signals you have seen in the study? Thank you.
Speaker Change: We've seen earlier data that has suggested that our in-house product is actually superior to P1, as we call it, the previous product. So, yes, we're no longer dosing with P1, so we're not able to say on a patient-by-patient basis, is there a difference?
Arthur Stril: What was the second part of that question? Sorry.
Speaker Change: Oh, and have you seen any more?
Speaker Change: Yeah, take these things out. Thank you.
Speaker Change: Oh yes, we haven't seen any dose-limiting toxicities thus far, so we're very encouraged across all our programs with the safety profile we've seen across 1, 2, 3, 22 and 2022.
Speaker Change: like P1 and P2 are not comparable really in terms of expansion and we definitely see great results with P1, but like P2 in terms of like translational data that we get in terms of expansion is unmatched and
Arthur Stril: We definitely think that it's like really...
Arthur Stril: Provox that have a great palette. Well, it's like P1 is non-dosing one.
Speaker Change: Thank you so much for that, Carla. And one last question from us. So, for the Phase II studies for both 20 and 25-22, do you need active controls? And if so, what could be the controls? Thank you.
Speaker Change: We don't believe that we will need active controls, but again, we don't want to second-guess what the final guidance from the regulatory authorities are. We would anticipate those single-arm studies.
Speaker Change: Thank you so much for the Congress.
Speaker Change: Thank you. Our next...
Speaker Change: This question comes from Luisa Morgazu with Kempen. Please go ahead, your line is open.
Luisa Morgazu: Hi, team. Thank you for taking my questions.
Luisa Morgazu: I wanted to firstly ask, in terms of the three programs that have been initiated under the AstraZeneca partnership, do you already have any idea when you plan to provide more updates here, or is that totally under AstraZeneca guidance, let's say?
Speaker Change: Yeah, thank you so much. So we definitely, the program is, the programs are very much on the way and there's a daily...
Speaker Change: activities and discussions between the two teams who are working very closely together. I think it's interesting, and you can see also from the press release, that these are three programs in very distinct therapeutic areas and modalities. So we are doing hematological malignancies, we're doing solid tumors, and then we're doing in vivo gene therapy. So we're really leveraging the breadth and depth of the SelectUS platform, but also AstraZeneca's therapeutic area expertise.
Arthur Stril: We plan to provide an update likely next year on the progress of the programs. We want to be at a stage where the program has progressed enough that the update is meaningful. So stay tuned for this.
Speaker Change: Okay, perfect. And in terms of costs for the remainder of the year, what can we expect in terms of R&D and also SG&A?
Speaker Change: Yeah, great question. I think we'll be trending in the same vein as the beginning of the year. So I think we're not expecting any bonus at the end of the year.
Speaker Change: And we're in the process of, and we will be providing more update at the next update on the future years.
Arthur Stril: But the most important point is really that we were able to extend the cash runway into 2027, both through a combination of prudent cash management as well as increased revenue from our collaboration partners.
Speaker Change: OK, perfect. Thank you for the additional color. And that's all for my side.
Speaker Change: Thank you.
Speaker Change: Thank you. Our next question comes from Sylvine Richter with Goldman Sachs. Please go ahead, your line is open.
Speaker Change: This is Tommy on for Salveen. Thanks for taking our question and congrats on the progress.
Tommy: I think that the previously disclosed expectation for BOLI-1 was to have data by year end. Can you speak to what contributed to the shift to 2025? And as a follow-up, can you speak to the factors that you're thinking of towards establishing the Phase 2 dose? Thank you.
Speaker Change: The primary driver, and thank you for the question, the primary driver was actually to increase patient numbers within the later cohort. So we have expanded up to the maximum number of allowed patients.
Speaker Change: We wanted to make sure we had enough data to inform a very thoughtful phase 2 development. So we thought it prudent to actually get the extra data in order to support both us and the regulatory authorities in making the final decisions.
Arthur Stril: So hopefully that answers the question, but we believe it was the the most strategic path forward
Speaker Change: Thank you.
Speaker Change: Thank you. Our next question comes from Silvan Turkian with Citizens JMP. Please go ahead.
Silvan Turkian: Yeah, thank you. Thanks for taking my question and congrats on the progress.
Silvan Turkian: Maybe I'll welcome Adrian to select this. Could you please tell us a little bit at a high level if you're making, and what they could be, any changes to the medical research organization selectors as you take over from Dr. Frattini?
Speaker Change: And then could you also remind us if there are any royalties from Iowans? Thank you so much.
Adrian Kilcoyne: Thank you for the question. I'll take the first bit. So yes, of course, we believe that as we're embarking now towards phase two, we do need to build the capabilities in the organization. We have just...
Adrian Kilcoyne: recruited another hematologist oncologist into the team with extensive experience across multiple cell therapy companies including Otolis.
Adrian Kilcoyne: So we believe that that's really helped our capabilities moving forward.
Adrian Kilcoyne: We will continue to expand our clinical operations team as well. And again, we anticipate in 2025 we will have to expand further to support our Phase 2 activities. So we believe we are building the capabilities within the team now to support us moving forward.
Speaker Change: Thank you. Thank you. Thank you.
Arthur Stril: And I can take... Hi, Selvin. This is Arthur. I can take the question on IOvance. So just by way of reminder, IOvance is leveraging our TALEN gene editing platform to inactivate tumor-infiltrating lymphocytes.
Arthur Stril: And I think their recent BLA approval for non-edited TIL therapy is kind of testimony that we picked the right partner in the TIL space, which is now the only company that has an approved TIL therapy on the market, which is very exciting.
Arthur Stril: Exciting. So we have one program with them already in the clinic. It's a PD-1 inactivated tail therapy, IL-4001, which is currently in phase one evaluated in melanoma and non-small cells on cancer. And we do have economics attached to that, but they have not been disclosed.
Speaker Change: Thank you.
Speaker Change: Thank you. And this does conclude our Q&A session, as well as our conference call. Thank you all for your participation, and you may disconnect at any time.
Arthur Stril: So You
Arthur Stril: [music]
Arthur Stril: [music]