Q1 2025 AbCellera Biologics Inc Earnings Call
Operator: At this time, I would like to turn the call over to Tryn Stimart, Absolute Peace Legal and Compliance Officer. You may proceed. Thank you. Hello, everyone.
I would like to turn the call over to Dan Stein Mart absolute Chief legal and compliance Officer you May proceed.
Thank you Hello, everyone. Thank you for joining us for accelerated first quarter 2025 earnings call.
Tryn Stimart: Thank you for joining us for Abcellera's first quarter 2025 earnings call. I'm Tryn Stimart, Abcellera's Chief Legal and Compliance Officer. Dr. Carl Hansen, Abcellera's President and Chief Executive Officer, and Andrew Booth, Abcellera's Chief Financial Officer, are joining me on today's call.
Speaker Change: <unk> <unk>, chief legal and compliance officer, Dr. Carl Hansen, <unk>, President and Chief Executive Officer, and Andrew Booth <unk> Chief Financial Officer are joining me on today's call. During this call, we anticipate making projections and forward looking statements based on our current expectations and according to the safe Harbor provisions of the Pri.
Tryn Stimart: During this call, we anticipate making projections and forward-looking statements based on our current expectations and according to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Our actual results could differ materially due to several factors outlined in our latest Form 10-K and subsequent Forms 10-Q and 8-K filed with the Securities and Exchange Commission. Abcellera is not obligated to update any forward-looking statements, whether due to new information, future events, or otherwise.
Speaker Change: But securities Litigation Reform Act of 1095, our actual results could differ materially due to several factors outlined in our latest Form 10-K, and subsequent forms 10-Q, and 8-K filed with the Securities and Exchange Commission.
Speaker Change: <unk> is not obligated to update any forward looking statements, whether due to new information future events or otherwise.
Tryn Stimart: Our presentation today, including our earnings press release and SEC filings published earlier today, are available on our Investor Relations website.
Tryn Stimart: The information we provide about our pipeline is for the benefit of the investment community and is not intended to be promotional.
Speaker Change: is for the benefit of the investment community and is not intended to be promotional. As we transition to our prepared remarks, please note that all dollars referred to during the call are US dollars. After our prepared remarks, we will open the lines for questions and answers. Now, I'll turn the call over to Carl.
Tryn Stimart: As we transition to our prepared remarks, please note that all dollars referred to during the call are U.S. dollars.
Tryn Stimart: After our prepared remarks, we will open the lines for questions and answers.
Tryn Stimart: Now, I'll turn the call over to Carl. Quinn. And thank you everyone for joining us today.
Thanks, Tryn, and thank you everyone for joining us today.
Carl Hansen: This first quarter, we continue to execute against our key priorities for 2025, which include initiating phase one clinical trials for ABCL 635 and ABCL 575. nominating one or more additional development candidates and moving these into CTA enabling studies. Completing platform investments and starting to use our clinical manufacturing capabilities.
Carl Hansen: This first quarter, we continue to execute against our key priorities for 2025, which include initiating phase one clinical trials for ABCL 635 and ABCL 575.
Carl Hansen: Nominating one or more additional development candidates and moving these into CTA enabling studies, completing platform investments, and starting to use our clinical manufacturing capabilities.
Carl Hansen: Today, my prepared remarks are focused on providing additional details about ABCL 635, including revealing its target and indication for the first time. ABCL 635 is a potential first-in-class therapeutic antibody being developed for non-hormonal treatment of moderate to severe vasomotor symptoms, more commonly known as hot flashes, that are associated with menopause. ABCL 635 targets Neurokinin 3 receptor, or NK3R, which is a GPCR involved in endocrine homeostasis and thermoregulation. Notably, ABCL 635 is the first program from our GPCR and Ion Channels platform to advance into our pipeline.
Carl Hansen: Today, my prepared remarks are focused on providing additional details about ABCL 635, including revealing its target and indication for the first time.
Carl Hansen: ABCL 635 is a potential first-in-class therapeutic antibody being developed for non-hermonal treatment of moderate to severe vasomotor symptoms, more commonly known as hot flashes that are associated with menopause.
Carl Hansen: ABCL 635 targets Neurokinin 3 Receptor, or NK3R, which is a GPCR involved in endocrine homeostasis and thermal regulation.
Carl Hansen: Notably, ABCL 635 is the first program from our GPCR and I channel's platform to advance into our pipeline.
Carl Hansen: On our last earnings call, we discussed how we assess program investment decisions. And this slide summarizes our view of ABCL 635 in each of the four dimensions of our investment framework. First, starting with the science. The NK3R pathway is well understood and has been clinically validated with small molecules. giving us high confidence in the biology. Accordingly, we believe the main scientific risk for ABCL 635 is whether or not we can achieve sufficient target engagement. From a commercial perspective, VMS associated with menopause presents a large unmet medical need and a significant market opportunity. Approximately 30% of women experience moderate to severe BMS at some point in their lives, with more than half seeking treatment.
Carl Hansen: On our last earnings call, we discussed how we assess program investment decisions. And this slide summarizes our view of ABCL635 in each of the four dimensions of our investment framework.
First, starting with the science.
Carl Hansen: The NKFIR pathway is well understood and has been clinically validated with small molecules, giving us high confidence in the biology. Accordingly, we believe the main scientific risk for ABCL 635 is whether or not we can achieve sufficient target engagement.
Carl Hansen: From a commercial perspective, VMS associated with menopause presents a large, unmet medical need and a significant market opportunity. A approximately 30% of women experience moderate to severe VMS at some point in their lives, with more than half seeking treatment.
Carl Hansen: ABCL 635 has the potential to be the first antibody therapy in the NK3R class, a market estimated to reach over $2 billion in annual sales.
Carl Hansen: ABCL 635 has the potential to be the first antibody therapy in the NK3R class, a market estimated to reach over 2 billion in annual sales.
Carl Hansen: With respect to differentiation... ABCL 635 has the potential to be a first-in-class antibody treatment for BMS with dosing every four weeks and an improved safety profile as compared to small molecules. And finally, this program has a well-established development path with potential for important early readouts on biomarkers and efficacy.
Carl Hansen: With respect to differentiation, ABCL 635 has the potential to be a first-in-class anti-body treatment for BMS with dosing every four weeks and an improved safety profile as compared to small molecules.
Carl Hansen: And finally, this program has a well-established development path with potential for important early readouts on biomarkers and advocacy.
Carl Hansen: VMS represents an underserved, underappreciated, and serious unmet medical need. They impact the well-being, the productivity, the career advancement, and the income of millions of women in North America alone. In the United States, there are approximately 40 million women of menopausal age. VMS are the most common symptoms of menopause, and as I noted earlier, about 30% of women will experience moderate to severe VMS in their lifetime. The median duration of BMS is seven and a half years. Approximately 12% of women will experience symptoms for more than 10 years. And in some cases, BMS can last for decades.
VMS represents an underserved, underappreciated, and serious unmet medical need.
Carl Hansen: They impact the well-being, the productivity, the career advancement, and the income of millions of women in North America alone.
Carl Hansen: In the United States, there are approximately 40 million women menopausal age.
Carl Hansen: VMS are the most common symptoms of menopause, and as I noted earlier, about 30% of women will experience moderate to severe VMS in their lifetimes.
Carl Hansen: The median duration of VMS is seven and a half years, approximately 12% of women will experience symptoms for more than 10 years, and in some cases, VMS can last for decades.
Carl Hansen: This is why new treatments for BMS are an important addition to available therapies for women who suffer from this serious and long-overlooked condition. Menopause hormone therapy, or MHT, is recognized as an effective treatment for VMS and is the current standard of care. While effective, MHT is not for everyone. Approximately 12% of women are contraindicated for MHT, and 8% of women who begin MHT discontinue within 12 months. Additionally, in a recent global study, it was found that 57% of women who were eligible for MHT were against using it.
Carl Hansen: This is why new treatments for BMS are an important addition to available therapies for women who suffer from the serious and long overlooked condition.
Carl Hansen: Menopause hormone therapy, or MHT, is recognized as an effective treatment for DMS and is the current standard of care.
Carl Hansen: While effective, MHT is not for everyone. Approximately 12% of women are contraindicated for MHT and 8% of women who begin MHT discontinue within 12 months.
Carl Hansen: Additionally, in a recent global study, it was found that 57% of women who were eligible for MHT were against using it.
Carl Hansen: Non-hormonal treatments for VMS are therefore an important option for women who either cannot or who choose not to use MHT. NK3R antagonists have recently been proven as effective non-hormonal options for the treatment of DMS. NK3R is a GPCR protein expressed by candy neurons that are located in the infundibular nucleus, also known as the arcuate nucleus, which is a region of the hypothalamus. Candy neurons play a central role in regulating endocrine reproductive function and also impact thermoregulatory control via an interdependent neuronal pathway. Prior to menopause, candy neuronal activity is balanced by stimulatory NKB-NK3R signaling and the inhibitory effect of estrogen.
Carl Hansen: Non-harmonial treatments for VMS are therefore an important option for women who either cannot or who choose not to use MHT.
Carl Hansen: NK3R antagonists have recently been proven as effective non-hermonal options for the treatment of VMS.
Carl Hansen: NK-3R is a GPCR protein expressed by candy neurons that are located in the infantibular nucleus also known as the arculate nucleus, which is a region of the hypothalamus.
Carl Hansen: Candy Neurons play a central role in regulating endocrine reproductive function and also impact thermal regulatory control via an interdependent neuronal pathway.
Carl Hansen: Prior to Menopause, Candy Neuronal activity is balanced by Stimulatory, NKB, NK3R Stingling, and the inhibitory effect of estrogen.
Carl Hansen: In menopause, when estrogen levels decrease due to the natural process of reproductive aging, this neuronal activity becomes unbalanced. As a result, NKB increasingly binds NK3R, causing candy neurons to overactivate and stimulate the thermoregulatory neurons in another region of the brain, called the preoptic nucleus, which leads to hot flashes. ABCL 635 was designed to bind to NK3R and to prevent the activation of candy neurons by NKB. Blocking NKB-NK3R signaling with small molecules has been clinically shown to reduce both the frequency and severity of DMS associated with menopause. Importantly, the infundibular nucleus responds to soluble factors in the blood and is therefore one of the few specialized areas of the brain that is not isolated behind the blood-brain barrier.
Carl Hansen: As a result, NKB increasingly binds NK3R, causing candy neurons to overactivate and stimulate the thermoregulatory neurons in another region of the brain called the preoptic nucleus, which leads to hot flashes.
Carl Hansen: KBCL 635 was designed to bind to NK3R and to prevent the activation of candy neurons by NKB.
Carl Hansen: Blocking, NKB, NK3, or signaling with small molecules has been clinically shown to reduce both the frequency and severity of DMS associated with menopause.
Carl Hansen: Importantly, the infantibular nucleus responds to soluble factors in the blood and is therefore one of the few specialized areas of the brain that is not isolated behind the blood brain barrier.
Carl Hansen: Because of this, we believe that ABCL635 should be able to engage NK3R on candy neurons, and our preclinical studies support this hypothesis. Translating this result into humans and confirming that target engagement is sufficient to reduce BMS is the key scientific risk in this program.
Carl Hansen: Because of this, we believe that ABCL 635 should be able to engage NK3R on candy neurons and our pre-clinical studies support the cypothesis.
Carl Hansen: Translating this result into humans and confirming that target engagement is sufficient to reduce BMS is the key scientific risk in this program.
Carl Hansen: There are two small molecule NK3R antagonists that have recently been demonstrated clinically to be both safe and effective. Therefore, ABCL 635 has the potential to enter the market at a time when the class has already been established and small molecules are approaching peak sales. Fesalinitant, a once daily oral treatment, was approved in May of 2023 and is the first available NK3R antagonist for the treatment of DMS. Ellen Zanitant, also a once-daily oral treatment, successfully completed phase three trials and is expected to be approved within the year. Unlike Fesalinitant, Elanzanitant is a non-selective antagonist that blocks both NK3R and a related receptor NK1R.
Carl Hansen: There are two small molecule NK-3R antagonists that have recently been demonstrated clinically to be both safe and effective. Therefore, ABCL 635 has the potential to enter the market at a time when the class has already been established and small molecules are approaching peak sales.
Carl Hansen: Fezellinatant, a once daily oral treatment, was approved in May of 2023, and is the first available NK3R antagonist for the treatment of VMS.
Carl Hansen: Alan Zanatant, also a once daily oral treatment, successfully completed base three trials and is expected to be approved within the year. Unlike Fensilined Attents, Alan Zanatant is a non-selective antagonist that blocks both NK3R and a related receptor NK1R.
Carl Hansen: Because ABCL 635 is an NK3R specific antibody, we expect that it will avoid some side effects that have been observed with small molecules in the clinic. First, unlike small molecules that are metabolized in the liver, antibodies are generally not associated with liver toxicity. And second, because ABCL 635 is specific to NK3R, we do not expect fatigue or somnolence that is believed to be related to the antagonism of NK1R.
Carl Hansen: because ADCL 635 is an NK3R-specific antibody, we expected it will avoid some side effects that have been observed with small molecules in the clinic.
Carl Hansen: First, unlike small molecules that are metabolized in the liver, antibodies are generally not associated with liver toxicity.
Carl Hansen: And second, because ABCL 635 is specific to NK3R, we do not expect fatigue or psalmulant that is believed to be related to antagonism of NK1R.
Carl Hansen: In addition to having potential for an improved safety profile, we also believe ABCL 635 can achieve convenient dosing that would be preferred by a large fraction of women with BMS. To confirm this, we conducted a market research survey of 75 women who have VMS and found that, assuming equal efficacy and safety profiles, more than 50% said they would prefer the convenience of a once-monthly injectable over a daily oral treatment. In addition, for the subset of women with experience using auto-injectors, a large majority, approximately 70%, said they would select a once-monthly injectable over a daily pill.
Carl Hansen: In addition to having potential for an improved safety profile, we also believe Abcell 635 can achieve convenient dosing that would be preferred by a large fraction of women with BMS.
Carl Hansen: To confirm this, we conducted a market research survey of 75 women who had VMF and found that assuming equal efficacy and safety profiles, more than 50% said they would prefer the convenience of a once-monthly injectable over a daily oral treatment.
Carl Hansen: In addition, for the subset of women with experience using auto injectors, a large majority, approximately 70%, said they would select a once-monthly injectable over a daily pill.
Carl Hansen: In summary, the recent and upcoming approvals of novel non-hormonal treatments for BMS are an important and long overdue solution for millions of women. ABCL 635 is being developed as a next generation NK3R antagonist with both an improved safety profile and a more convenient dosing regimen. If ultimately successful, we believe it can be a highly differentiated product that is launched into a large and established market. In terms of timing, our plans include completing the CTA process this quarter. starting our phase one study in Q3 of 2025 and reporting key readouts of safety and early efficacy in mid-2026.
Carl Hansen: In summary, the recent and upcoming approvals of novel non-hormonal treatments for VMS are an important and long-overdue solution for millions of women.
Carl Hansen: ABCL 635 is being developed as a next generation NK3R antagonist with both an improved safety profile and a more convenient dosing regimen.
Carl Hansen: If ultimately successful, we believe it can be a highly differentiated product that is launched into a large and established market.
Carl Hansen: In terms of timing, our plans include completing the CTA process at this quarter, starting our phase one study in Q3 of 2025, and reporting key readouts of safety and early efficacy in mid-2026.
Carl Hansen: As ABCL 635 goes into clinical trials, we have high conviction in the biology, the differentiation thesis, and the unmet medical need. We expect the most important risk regarding target engagement will be addressed in Phase 1, making this an important near-term clinical readout.
Carl Hansen: As ADCL-635 goes into clinical trials, we have high conviction in the biology, the differentiation thesis, and the unmet medical need. We expect the most important risk regarding target engagement will be addressed in phase one, making this an important near-term clinical readout.
Carl Hansen: Turning to our second program, we have been advancing ABCL 575 concurrently with ABCL 635. It is also on track with a CTA filing in Q2, and we anticipate starting Phase 1 clinical trials in the third quarter.
Carl Hansen: Turning to our second program, we have been advancing ABCL 575 concurrently with ABCL 635. It is also on track with a CTA filing in Q2 and we anticipate starting phase one clinical trials in the third quarter.
Carl Hansen: Later this week, our team will be in San Diego presenting preclinical data on ABCL 575 at the annual meeting of the Society for Investigative Dermatology. You can download the poster presentation on our website when it becomes available tomorrow, May 9th.
Carl Hansen: Later this week, our team will be in San Diego presenting pre-clinical data on ABCL 575 at the annual meeting of the Society for Investigative Dermatology. You can download the poster presentation on our website when it becomes available tomorrow
Carl Hansen: With our first two programs nearing the clinic, our transition from a platform company to a clinical stage biotech is nearly complete. Behind ABCL 635 and ABCL 575, we are working on a portfolio of more than 20 internal and co-development programs from which we will continue to build our pipeline. As mentioned earlier, ABCL 635 will be the first clinical program derived from our GPCR and IAM channels platform. We view this as an important proof point that our technology can unlock these challenging and high-value target classes, which represent approximately half of our preclinical program. We expect to elect an additional development candidate from this platform in the near future and look forward to sharing updates with you as they become available.
Carl Hansen: With our first two programs near in the clinic, our transition from a platform company to a clinical stage biotech is nearly complete. Behind ABCL 635 and ABCL 575, we are working on a portfolio of more than 20 internal and co-development programs, from which we will continue to build our pipeline.
Carl Hansen: As mentioned earlier, ABCL 635 will be the first clinical program derived from our GPCR in ion channels platform. We view this as an important proof point that our technology can unlock these challenging and high-value target classes which represent approximately half of our pre-clinical programs.
Carl Hansen: We expect to elect an additional development candidate from this platform in the near future and look forward to sharing updates with you as they become available.
Carl Hansen: Similarly, we see our T-Cell Engager platform as a source of internal programs and also as a basis for future partnering activities. Last month, we provided an update on our TCE platform, including in vivo data that was presented at AACR's annual meeting.
Carl Hansen: Similarly, we see our T-cell Engager platform as a source of internal programs and also as a basis for future partnering activities. Last month, we provided an update on our TCE platform, including in vivo data that was presented at AECR's annual meeting.
Carl Hansen: And finally, investments in building our clinical manufacturing are on track and are nearing completion. We expect to start using these capabilities later this year.
Carl Hansen: And finally, investments in building our clinical manufacturing are on track and are nearing completion. We expect to start using these capabilities later this year. And with that, I will hand over to Andrew to discuss our financials. Andrew?
Andrew Booth: And with that, I will hand over to Andrew to discuss our financials. Andrew. Thanks, Carl. As Carl pointed out, Abcellera continues to be in a strong liquidity position, with approximately $630 million in cash and equivalents and with roughly $180 million in available committed government funding to continue to execute on our strategy. We are continuing our plans with a focus on internal programs and completing our CMC and GMP investments. Looking at our key business metrics, in the fourth quarter, we started to work on one partner-initiated program, which takes us to a cumulative total of 97 programs with downstream participation.
Thanks, Carl.
Andrew Booth: As Carl pointed out, Abcellera continues to be in a strong liquidity position, with approximately $630 million in cash and equivalence, and with roughly $180 million in available committed government funding to continue to execute on our strategy.
Carl Hansen: We are continuing our plans with a focus on internal programs and completing our CMC and GMP investments.
Carl Hansen: Looking at our key business metrics, in the fourth quarter we started to work on one partner initiated program which takes us to accumulate of total of 97 programs with downstream participation.
Andrew Booth: We saw no new molecules advancing into the clinic in the quarter, maintaining our cumulative total of 16 molecules to have reached the clinic. And we understand the development of the four Triani-licensed molecules that Novarok advanced into Phase I are currently paused. As we have stated previously, we view the overall progress of molecules in the clinic as a potential source of near and mid-term revenue from downstream milestone fees and royalty payments in the longer term.
Carl Hansen: We saw no new molecules advancing into the clinic in the quarter, maintaining our cumulative total of 16 molecules to have reached the clinic, and we understand the development of the four trianny-licensed molecules that Nova Rock advanced into phase one are currently paused.
Carl Hansen: As we have stated previously, we view the overall progress of molecules in the clinic as a potential source of near and midterm revenue from downstream milestone fees and royalty payments in the longer term.
Andrew Booth: Turning to revenue and expenses, revenue for the quarter was about $4 million, mostly driven by research fees relating to the work on partnered programs. This compares to revenue of $10 million in the same quarter of 2024. As we have mentioned in the past, we expect research fee revenue to continue to trend lower as we increasingly focus on internal and co-development programs. Our research and development expenses for the quarter were approximately $43 million, $3 million more than last year. This expense is driven by increasing investment in our internal and co-development programs. In sales and marketing, expenses for Q1 were about $3 million, a modest reduction relative to the same quarter last year.
Turning to Revenue and Expenses
Carl Hansen: Revenue for the quarter was about $4 million, mostly driven by research fees relating to the work on partnered programs.
Carl Hansen: This compares to revenue of $10 million in the same quarter of 2024. As we have mentioned in the past, we expect research fee revenue to continue to trend lower as we increasingly focus on internal and co-development programs.
Carl Hansen: Our research and development expenses for the quarter were approximately $43 million, $3 million more than last year. This expense is driven by increasing investment in our internal and co-development programs.
Carl Hansen: In sales and marketing, expenses for Q1 were about $3 million, a modest reduction relative to the same quarter last year, and in general in administration, expenses were approximately $16 million, compared to roughly $17 million in Q1 of 2024.
Andrew Booth: And in general and administration, expenses were approximately $16 million, compared to roughly $17 million in Q1 of 2024.
Andrew Booth: Looking at earnings, we are reporting a net loss of roughly $46 million for the quarter compared to a loss of around $41 million in the same quarter last year. In terms of earnings per share, this result works out to a loss of $0.15 per share on a basic and diluted basis. Looking at cash flows, operating activities for Q1 of 2025 used approximately $12 million in cash and equivalent. Excluding investments in marketable securities, investment activities amounted to a net $17 million, mostly in property, plant, and equipment, driven by our ongoing work to establish CMC and GMP manufacturing capabilities.
Carl Hansen: Looking at earnings, we are reporting a net loss of roughly $6.46 million for the quarter, compared to a loss of around $41 million in the same quarter last year. In terms of earnings per share, this result works out to a loss of $0.15 per share on a basic and diluted basis.
Carl Hansen: Looking at cash flows, operating activities for Q1 of 2025 used approximately $12 million in cash and
Carl Hansen: Excluding investments in marketable securities, investment activities amounted to a net $17 million, mostly in property plant and equipment, driven by our ongoing work to establish CMC and GMP manufacturing capabilities.
Andrew Booth: The investments in PP&E were partially offset by government contributions. And as a part of our treasury strategy, we have nearly $450 million invested in short-term marketable security. Our investment activities for the quarter included approximately a $25 million net decrease in these holdings.
The investments in PP&E were partially offset by government contributions.
Carl Hansen: and as a part of our Treasury strategy, we have nearly $450 million invested in short-term marketable securities.
Carl Hansen: Our investment activities for the quarter included approximately $25 million net decrease in these holdings.
Andrew Booth: Altogether, we finished the quarter with over $630 million of total cash, cash equivalents, and marketable securities. As a reminder, we have received commitments for funding for our GMP facility and for the advancement of our internal pipeline from the Government of Canada's Strategic Innovation Fund and the Government of British Columbia. This available capital does not show up on our balance sheet. With over $630 million in cash and equivalents and the unused portion of our secured government funding, we have approximately $810 million in total available liquidity to continue executing on our strategy. The cash usage for the remainder of 2025 will continue to prioritize advancing our two lead programs to the clinic, building the preclinical pipeline, and completing our investment in the integrated CMC and GMP capability.
Carl Hansen: All together, we finish the quarter with over $630 million of total cash, cash equivalents, and marketable securities.
Carl Hansen: As a reminder, we have received commitments for funding for our GMP facility and for the advancement of our internal pipeline from the Government of Canada's Strategic Innovation Fund and the Government of British Columbia. This available capital does not show up on our balance sheet.
Carl Hansen: With over $630 million in cash and equivalence and the unused portion of our secured government funding, we have approximately $810 million in total available liquidity to continue executing on our strategy.
Carl Hansen: The cash usage for the remainder of 2025 will continue to prioritize advancing our two lead programs to the clinic, building the preclinical pipeline, and completing our investment in the integrated CMC and GMP capabilities.
Andrew Booth: As previously communicated, the new manufacturing facility is scheduled to come online at the end of 2025. With respect to our overall operating expenses, our capital needs are very manageable. We continue to believe that we have sufficient liquidity to fund well beyond the next three years of increasing pipeline investment.
Carl Hansen: As previously communicated, the new manufacturing facility is scheduled to come online at the end of 2025.
Carl Hansen: With respect to our overall operating expenses, our capital needs are very manageable. We continue to believe that we have sufficient liquidity to fund well beyond the next three years of increasing pipeline investments.
Operator: And with that, we'll be happy to take questions. Thank you.
And with that, we'll be happy to take questions.
Operator: We will now begin the Q&A portion of the call. If you would like to ask a question, press star followed by one of your telephone keypads. To remove your question, press star followed by two. Again, to ask a question, press star 1. As a reminder, if you're using a speakerphone, please remember to pick up your handset before asking a question.
Operator: We will pause here briefly if questions are registered.
Jackie: Our first question comes from Brendan Smith with TD Securities. You may now proceed.
Speaker Change: Our first question comes from Brendan Smyth with TD Securities You May now proceed.
Jackie: Hey, this is Jackie. I'm for Brendan. Congrats on the quarter and thank you for taking my question. Maybe just a quick one on 6.3.5. What do you expect this asset needs to see in terms of phase one data and any follow-up data to really capture that competitive edge given the head start that peers have, you know, going beyond just, you know, that it's more of a nicer dose and the preferred kind of type of medicine? Yeah, that's very helpful. Thank you.
Carl Hansen: Hey, this is Jackie on for Brandon Congrats on the quarter and thank you for taking my question maybe.
Speaker Change: Maybe just a quick one on fixed three five what do you expect this asset needs to see in terms of phase one data and any follow up data to really capture that competitive edge given the head start that appear to have.
Carl Hansen: Going beyond just that it's more.
Carl Hansen: Nicer.
Carl Hansen: Nicer dose in preferred.
Carl Hansen: Type of medicine.
Carl Hansen: Sure I'm happy to take that question Carl here so.
Speaker Change: Obviously, there's some recent activity in the approval of NK <unk> antagonist with Firth <unk>.
Carl Hansen: It's a terrific outcome for patients that are looking for a non hormonal treatments.
Carl Hansen: We view.
Carl Hansen: The the validation and the success of those molecules as very positive for this program, there's going to be some time required to.
Carl Hansen: To communicate to medical practitioners and patients and to start to build the class.
Carl Hansen: And we are positioned with a molecule that would take advantage of that growing awareness and would be positioned if it is successful to launch into what has become a large and established class.
Carl Hansen: In terms of what we need to see in the phase one studies, we haven't disclosed the design of those studies, but we will be looking of course at safety, but also at some very important data on Biomarkers, which are an early sign of target engagement.
Carl Hansen: And.
Carl Hansen: On the latter part of the study evaluating efficacy in.
Carl Hansen: In a population of participants.
Carl Hansen: So one of the really attractive things about this program is that by mid point next year, we should have data.
Carl Hansen: That tells US a lot about.
Carl Hansen: The success of the program in the science.
Carl Hansen: And with that we'd be in a position to double down and to invest further.
Carl Hansen: From a differentiation perspective, which was related to what part of your question.
Carl Hansen: Really it's two things. The first is we do believe that an antibody that is specific to <unk> can have a cleaner safety profile.
Carl Hansen: Just something that that we believe is highly valued and differentiated and perhaps even more in differentiation is the dosing as mentioned in my prepared remarks.
Carl Hansen: We we have conducted a study that shows that.
Carl Hansen: Majority of women would prefer to have a once monthly subcutaneous self administered injection over a daily pill.
Carl Hansen: And for women that have experience with auto injectors that number goes up to about 70%.
Carl Hansen: With the.
Carl Hansen: The growing use of auto injectors, particularly in the <unk> one class, we see that as a trend that's going to continue to grow over time.
Carl Hansen: It's a matter of convenience, it's a matter of compliance.
Carl Hansen: And people that have busy lives would.
Carl Hansen: Would prefer to have something that is something you do once a month and then you don't have to worry about it after that.
Carl Hansen: If we are successful and of course, we're just at the very beginning of this so our eyes are laser focused on getting this early data, but if successful again it launches into a large class and we think that there is a significant population in fact, the majority that would prefer that format.
Speaker Change: No that's very helpful. Thank you.
Carl Hansen: Then maybe one, just a quick one. What should we expect to see from the upcoming 575 preclinical data tomorrow presented at the Medical Bain Institute? Sure, yeah, so we are presenting at SID, as I mentioned. You know, the preclinical data will include, you know, some early animal work that supported the filing, and probably the most important data is the first glimpse at PK analysis and predictions of what that would lead to in human studies. The main pillar of differentiation for ABCL 575 is that we believe it will be differentiated in having a superior dosing regimen, and we're aiming for having, you know, at least three month, if not six month dosing, and are optimistic that you'll be pleased with the data when you see it.
Speaker Change: And then maybe one just quick one what should we expect to see from the upcoming 575 preclinical data tomorrow presented at the medical meeting.
Speaker Change: Sure Yes.
Speaker Change: We are presenting that said as I mentioned.
Speaker Change: The preclinical data will include some early.
Speaker Change: The animal work that supported the filing and probably the most important data is the first glimpse at PK analysis.
Speaker Change: And predictions of what that would be too in human studies.
Speaker Change: The main pillar of differentiation for <unk> 575 is that we believe it will be.
Speaker Change: It will be differentiated and having a superior dosing regimen and we're aiming for having.
Speaker Change: At least three months, if not six months dosing.
Speaker Change: And are optimistic that you'll be pleased with the data when you see it.
Jackie: Great. Thank you so much. Thank you.
Speaker Change: Great. Thank you so much.
Speaker Change: Thank you.
Talani: Our next question comes from Andrea Newkirk with Goldman Sachs. You may now proceed.
Speaker Change: Our next question comes from Andrea <unk> with Goldman Sachs. You May now proceed.
Talani: Hi all, this is Talani on for Andrea. Thanks for taking the questions and congrats on the progress. Just one, another quick one on 6.3.5. Given the risk you had mentioned facing the program around translatability of the NK3R engagement from the preclinical studies into humans, is there a precedent you could point to that gives you confidence that those observations will still hold in the clinical setting? That's a great question. So, you know, we have preclinical data, including data on NHP, that give us, you know, a lot of reason to be optimistic that this will translate into humans.
Speaker Change: Hi, all this is <unk> on for Andrea Thanks for taking the questions on congrats on the progress just one another quick one on <unk> five given the risk you had mentioned based on the program ran translate ability.
Speaker Change: Keith we are engagement from the preclinical studies into humans is there a precedent you could point to that gives you confidence that those observations will still hold in the clinical setting.
Speaker Change: That's a great question so.
Speaker Change: We have we have preclinical data, including data on an H P.
Speaker Change: That give us.
Speaker Change: A lot of reason to be optimistic that this will translate into humans and so I think I am being circumspect, largely because drug development is a humbling industry and youre, often surprised and of course non nonhuman primates are not humans. So it needs to be shown there.
Carl Hansen: And so I think I am being circumspect largely because drug development is a humbling industry, and you're often surprised. And, of course, non-human primates are not humans. So it needs to be shown there. In terms of precedent, you know, there are there are some antibodies, I believe, you know, CGRP receptor that are in a similar part of the brain. So there is some precedent, but, you know, this is a different pathway and the details of where the neurons are in that part of the brain. And, of course, you know, behind that, whether or not we have complete understanding of the pathway, which we believe we do, but sometimes you can be surprised, all of those things need to be de-risked.
Speaker Change: In terms of precedent there are.
Speaker Change: There are some antibodies I believe.
Speaker Change: <unk> receptor.
Speaker Change: And a similar part of the brain. So there is some precedent but.
Speaker Change: This is a different pathway.
Speaker Change: And the.
Speaker Change: The details of where the neurons are in that part of the brain.
Speaker Change: And of course behind that.
Speaker Change: Whether or not we have complete understanding of the pathway, which we believe we do but sometimes you can be surprised all of those things need to be de risked and the important thing for <unk> 65 is that the development path allows us to test both of those main risks.
Carl Hansen: And the important thing for ABCell 635 is that the development path allows us to test both of those main risks early in clinical development through a biomarker readout and early efficacy. So, you know, it's not that I would bet against it, but I think in all drug development, we should be cautious and not assume that things are going to translate directly from non-human primate to human.
Early in clinical development through the through a biomarker readout and early efficacy so.
Speaker Change: It's not it's not that I would bet against it but I think in all drug development, we should be cautious and not.
Speaker Change: Not.
Speaker Change: Assume that things are going to translate directly from nonhuman primates to humans.
Talani: Okay, understood. Thank you.
Speaker Change: Okay understood. Thank you and then just one more if I may with both 5765 now advancing into the clinic. How are you thinking about the next development candidates and is there any line of sight at the sign as to what targets are indications might be select that are of interest.
Carl Hansen: And then just one more, if I may. With both 575 and 635 now advancing into the clinic, how are you thinking about the next development candidates? And is there any line of sight at the sinus? So what targets or indications might be selected or of interest?
Carl Hansen: Sure, I'll take that one again. Yeah, so we are building our portfolio and making investment decisions according to the framework that I outlined in some detail in the last earnings call and that I alluded to at the start today. Basically, we're looking for high conviction biology with a large unmet medical need, a compelling case for differentiation, and importantly, a development path that allows us to get as much information as quickly as possible, and it doesn't pose undue risk or require a huge amount of time and money to get those early answers. Beyond that, we are target agnostic.
Speaker Change: Sure I'll take that one again.
Speaker Change: So we are building, our our portfolio in making investment decisions. According to the framework that I outlined in some detail on the last earnings call and that I alluded to at the start at the start today.
Speaker Change: Basically we're looking for high conviction biology.
Speaker Change: With a large unmet medical need a compelling case for differentiation and importantly, a development path that allows us to get as much information as quickly as possible and it doesn't pose undue risk or or require a huge amount of time and money to get to those are the answers beyond that we are targeting.
Carl Hansen: So we have been looking broadly across indications, broadly across biology, to look for opportunities that we're excited about. A substantial portion of that effort has brought us to the difficult target classes, so ion channels and GPCRs. And as I said in my prepared remarks, it's likely that the next development candidate that will come up will be another one that is either a GPCR or ion channel that builds on what has been years of technology and capability building to unlock that class. And we're quite excited about that.
Speaker Change: Good agnostic so we have been looking broadly across indications broadly across biology.
Speaker Change: To look for opportunities that we're excited about.
Speaker Change: A substantial portion of that.
Speaker Change: That effort has brought us to the difficult target classes, so ion channels in <unk> and as I said in my prepared remarks.
Speaker Change: It's likely that the next development candidate that will come up will be another one that is either a GTC our ion channel that builds on what has been years of technology and capability building to unlock that class and we're quite excited about that.
Carl Hansen: Typically, we will not be discussing targets or indications until a program has moved at least to development candidate. And once it is a development candidate, we will disclose the indication and the target if we believe that that is strategically wise. And we will avoid doing that if we think that there's downside in terms of competition. And so, depending on what the target is, we'll either disclose very early, as we did with 575, or we will hold it closer to our chest and disclose it closer to CTA filing, as we have done with NK3R. Makes sense, thank you.
Speaker Change: Typically we will not be.
Speaker Change: Discussing targets or indications Intel our program has moved at least to development candidate and once it is a development candidate we will disclose the indication that target.
Speaker Change: If we believe that that is strategically wise and we will avoid doing that if we think that.
Speaker Change: There is downside in terms of competition and so depending on what the target is we'll either disclosed very early as we did with 575 or.
Speaker Change: Or we will hold it closer to our chest and disclose it.
Speaker Change: Closer to CPA filing as we have done with <unk>.
Speaker Change: Makes sense. Thank you.
Speaker Change: Yeah.
Puneet Souda: Our next question comes from Puneet Souda with Lee Rink Partners. You may now proceed. My first one has to do with the 575 asset, so during the quarter we saw some updates from lacotinlamab as well as amlitelamab and asthma, I was wondering if you had any comments on how those readouts inform your updated view of the opportunities for the particular asset.
Speaker Change: Our next question comes from Puneet <unk> with Leerink partners you May now proceed.
puneet: My first one has to do with the $5 75 asphalt.
puneet: During the quarter, we saw some uptake from Washington Lab, Walter Hamilton animal telling that in ethanol I was wondering if you had any comments on how those readout.
puneet: Form your updated view of the opportunity for particular asphalt.
Carl Hansen: Yes, Carl here. I'm happy to take that one. Thanks for the question, Puneet. So, you know, first of all, you know, our investment thesis in 5.7.5 is reinforced by the hypothesis that the OX40 ligand class is going to be a huge class, important not just in atopic dermatitis, which is obviously a huge market, but also will find applications across other indications. Over the last quarter, I think there's been, you know, several points that confirm and reinforce that hypothesis. So, there is the Sanofi trial in asthma. And while they did not read out on the top line, there was a subset of patients for which they got 70% responses, which is excellent.
puneet: Yes.
puneet: Here I'm happy to take that one thanks for the question Puneet.
puneet: So.
puneet: First of all our our investment thesis and 575 is.
puneet: Is reinforced by the the hypothesis that the ox 40 ligand class is going to be a huge class important not just in atopic dermatitis, which is obviously a huge market.
puneet: But also we'll find applications across other indications.
puneet: Over the last quarter I think there has been.
puneet: Several points that confirm and reinforce the hypothesis.
puneet: There is the Sanofi trial.
puneet: In asthma and while they did not.
puneet: Readout on the top line there was a subset of patients for which they got at 70% responses, which is excellent.
Carl Hansen: That subset of patients are the patients with high eosinophil counts, which is the same patient group for which dupixent is being used. And so, we view that as a very strong positive signal that OX40 ligand is going to have applications and be an important therapeutic option in asthma. And of course, you know, Sanofi has put their money where their mouth is. They are advancing that into phase three. So, we see that as a very positive outcome. In addition to that, there was a readout for another OX40-OX40 ligand molecule in the gene with some early efficacy in alopecia, which again highlights that OX40 ligand will have applications broadly in INI.
puneet: Subset of patients or the patients with high eosinophil accounts, which is the same patient group.
puneet: For which <unk> is being used and so we view that as a very strong positive signal that ox 40 ligand is going to have applications in being important.
puneet: An important therapeutic option in asthma.
puneet: And of course, you know Sanofi has put their money where their mouth is they're advancing that into phase III. So we see that as a very positive outcome.
puneet: In addition to that.
puneet: There was a readout for another ox 40, ox 40 ligand molecule.
puneet: Imaging with some early efficacy in alopecia, which again highlights that ox 40 ligand will have applications broadly and ini and while it has not been widely.
Carl Hansen: And while it has not been widely covered, Sanofi has decided to advance an OX40 ligand TNF-alpha bispecific for HS. So, that is another example of OX40 ligand being important in HS and also reinforces a second pillar of our investment thesis, which is that OX40 ligand is a particularly good pathway, or OX40-OX40 ligand is a particularly good pathway for combination therapy.
puneet: Covered.
puneet: Sanofi has decided to advance an ox 40 ligand TNF alpha by specific for <unk>. So that is another example of ox 40 ligand being important in Hs and also reinforces the second pillar of our investment thesis, which is that ox 40 ligand is a particularly good pathway or ox 40, Osprey login is particularly good pathway for combination.
Carl Hansen: You asked also about rocatinlamab. They've released additional data. I would say that the data is disappointing compared to what has been seen with amlatilamab. It's not clear if that is a reflection of the difference between targeting OX40 ligand and OX40, or if it's a difference with the mechanism of action, because rocatinlamab is, of course, a depleting antibody, whereas we have an FC effector null variant, which will not deplete cells. So, all of that we view as being very positive and a tailwind for the program. You know, in our shop, we're currently focused on getting the early phase one data.
puneet: P.
puneet: You asked also about rocket <unk> Dave.
puneet: They've released additional data.
puneet: <unk>.
puneet: I would say that the data is disappointing compared to what has been seen with <unk>. It's not clear if that is a reflection of the difference between targeting ox 40 ligand and ox 40, or if it's a difference with the mechanism of action because rocket <unk> is of course.
puneet: Depleting antibody, whereas we have an FC effector.
puneet: No variant, which will not deplete.
puneet: So all of that we view as being a <unk>.
puneet: Very positive and a tailwind for the program.
puneet: In our shop, we're currently focused on getting the early phase one data. The most important part of that is going to be demonstrating.
Carl Hansen: The most important part of that is going to be demonstrating the long extended PK, and then a lot of the big catalysts are going to come from outside of ebcelera, and examples of the OX40-OX40 ligand class working in other indications or working in combination are things that we believe, you know, add value to that program and make it more attractive going forward. So, we're keeping an eye on that, just like you are.
puneet: The long extended PK and then a lot of the big catalysts are going to come from outside <unk> and examples of the ox 40, Ox 40 ligand class working at other indications or working in combination are things that we believe.
puneet: Add value to that program and make it more attractive.
puneet: Going forward. So we're keeping an eye on that just like you are.
Andrew Booth: Okay, and then I have one, maybe a bit of a deep cut, but given pharma tariffs, there's been a lot of talk about where IP gets domiciled. As a Canada based company, I was wondering if that becomes an elementary discussion when you're thinking about, you know, spinning off assets to potential partners.
puneet: Okay, and then I have one maybe a bit of a deep cut but.
puneet: Given pharma tariffs, there's been a lot of talk about where IP is domiciled.
puneet: Canada based company I was wondering if that becomes an element of the discussion when you're thinking about.
puneet: Spinning off assets to potential partners.
Andrew Booth: Hey, thanks. It's Andrew here. I think at the moment, we haven't had a discussion in terms of spinning off assets. We have our intellectual property up here in Canada, and for now, it remains a good jurisdiction for us to hold intellectual property. So we haven't had many discussions further than that. Got it. Thank you.
puneet: Hey, Thanks, It's Andrew here I think at the moment.
Speaker Change: We haven't had that discussion in terms of.
Speaker Change: Spinning off assets. So we have our intellectual property up here in Canada and for now it remains a good jurisdiction for us to hold intellectual property. So we haven't had many can discussions further than that.
Speaker Change: Yeah.
Speaker Change: Got it thank you.
Speaker Change: Thank you.
Mark Hoffman: Our next question comes from Malcolm Hoffman with BMO. You may now proceed.
Speaker Change: Our next question comes from Malcolm Hoffman with BMO you May now proceed.
Speaker Change: Okay.
Mark Hoffman: Hi, I'm Mark Hoffman for Evan Seigerman from BMO. You called up four Novarox molecules in the clinic that have been paused. Can you provide some more context to this pause and what it means for future development? And then kind of extending off the conversation around IP and tariffs, I know a decent amount of the manufacturing capabilities for Abcellera are based in Canada. Is there any consideration for potentially producing U.S.-based manufacturing redundancies to kind of address that potential risk in the future? Thank you.
Malcolm Hoffman: Hi, Mark Multiline for admin citizen can be amount you called up for novel molecules in clinical and then Paul can you provide some more context to this pause.
Speaker Change: For future development, and then kind of extending off the conversation around IP in Paris.
Speaker Change: <unk>, a decent amount of manufacturing capabilities, which are based on Canada is there any consideration for potentially producing U S based manufacturing redundancies to kind of address that potential.
Speaker Change: Potential risks in the future. Thank you.
Carl Hansen: Yeah, sure, I'm happy to take that one. With regard to the NOVAROC molecules, I think we just thought it prudent to disclose what we had seen on their own website. We believe it's related to fundraising, which is not uncommon in the present environment for them to complete fundraising in order to continue those trials, but we'll keep an eye on that and give any updates as we see it. With regards to the manufacturing facility, we do have this manufacturing facility in Canada. Right now, we have built this manufacturing facility in order to support us in our phase one, phase two clinical trials, so still during research phase of manufacturing the product.
Yes, sure I'm happy to take that one with regard to the overall molecules I think we just thought it.
Speaker Change: It prudent to disclose.
Speaker Change: What we had seen on their own website, we believe it's related to.
Speaker Change: Fundraising, which is not uncommon in the present in the present environment for them to complete fund raising in order to continue those trials, but we will keep an eye on that and give any updates as we see it.
Speaker Change: With regards to the manufacturing facility and we do have this manufacturing facility in Canada.
Speaker Change: Right now we are we have built this manufacturing facility in order to support us in our phase one phase two clinical trials, so still doing research.
Speaker Change: Phase of the of manufacturing the product and as you know as we have mentioned our first two molecules we are advancing them through the Cta in Canada, but even as it's still even if we start trials in the United States I don't believe it will be an issue in moving those products over the border in order to conduct those clinical trials.
Carl Hansen: And as you know, as we have mentioned, our first two molecules, we are advancing them through to CTA in Canada. But even as it's still, even if we start trials in the United States, I don't believe it will be an issue in moving those products over the border in order to conduct those clinical trials.
Mark Hoffman: We haven't given any thought. It's still quite early to think about when we get to commercial, when we think about commercial manufacturing for any of these molecules, where that might be done. And that's still a topic for much, much in the distant future. I appreciate it. Thanks, guys. Thank you.
Speaker Change: We haven't given any thought it's still quite early to think about when we get to commercial when we think about commercial manufacturing for any of these molecules where that might be done and thats still a topic for.
Speaker Change: Much much in the distant future.
Speaker Change: I appreciate it thanks guys.
Speaker Change: Thank you.
Srikripa Devarakonda: Our next question comes from Srikripa Devarakonda with Truist. You may now proceed. Hi, guys.
Speaker Change: Our next question comes.
Speaker Change: From <unk>.
Speaker Change: Does taper macondo. It truly you may now proceed.
Speaker Change: Hey, guys. Congrats on all the progress and thank you so much for taking my question I know you.
Srikripa Devarakonda: Congrats on all the progress, and thank you so much for taking my question. I know you've not yet talked about trial design, but as you go through your planning, I was wondering if there are any specific learnings from all the other trials relevant to 635 that have already been done that can help you optimize your trials. And also, if I'm not mistaken, this, you know, as a target has had, NK3R has had a long history in terms of drug development, with earlier trials focused on neuropsychiatry. Wondering if there's good enough understanding, and if that could be, I know it's really early stages, but if there is a potential to expand beyond VMS. Thank you.
Speaker Change: <unk> talked a lot of challenges, but as you go through your planning I was wondering if there are any specific learnings from all the other trials relevant to 635 wells have already been done.
Speaker Change: It can help you.
Speaker Change: Optimize your child.
Speaker Change: And also if I'm not mistaken this.
Speaker Change: Target has had and Keith has had a long history in terms of drug development with earlier trials focused on noodles psychiatric <unk>.
Speaker Change: Wondering if there's good enough understanding that that could be I know, it's really early stages, but it has the potential to expand beyond VNS. Thank you.
Carl Hansen: Carl here. I'll take that. I'm actually not aware of the development of NK3R in neurological indications. I think there is some precedent for NK1R, which is the second target that is hit by elanxanetan. Beyond that, I don't think I'd be able to comment. Coming back to the development path, it is a big advantage that there is a clear development path that has now been successfully navigated by two products. So it's obvious what the final endpoints should be, the patient population, how to set that up. So we have an advantage from that perspective in that we don't have a lot of ambiguity as to what will be the bar for getting approval of ABCL 635.
Speaker Change: Carl here I'll take that I'm actually not aware of the development of NK three are in neurological indications I think there is some precedent for NK one R, which is the second target that is hit by <unk>.
Speaker Change: Beyond that I don't think I'd be able to comment.
Speaker Change: Coming back to the development path.
Speaker Change: It is it is.
Speaker Change: Is a big advantage that there is a clear development path that has now been successfully navigated by two products. So it's obvious what the final endpoint should be the patient population how to set that up.
Speaker Change: So we have an advantage from that perspective and that we we don't have a lot of ambiguity as to what will be the bar for getting approval.
Speaker Change: <unk> 605.
Carl Hansen: We haven't yet disclosed details of the clinical development plan, but as per my previous comments, our emphasis right now is to design the first trial and not to pull punches so that we can take as much risk off the table as soon as possible. So we are looking in this first trial not just to get a look at safety, which we believe will be good, but you always have to prove that, but also to get early evidence from biomarkers on target engagement and an early read on efficacy. So, once we have that in hand, then if it looks the way that we hope, we would be working to accelerate the path forward to development, and there's already some thinking and planning around that.
Speaker Change: We haven't yet.
Speaker Change: Closed details of the clinical development plan.
Speaker Change: But as per my previous comments, our emphasis right now is two.
Speaker Change: Design, the first trial and not to pull punches. So that we can take as much risk off the table as soon as possible.
Speaker Change: So we are looking in this first trial not just to get a look at safety, which we believe will be will be good but you always have to prove that but also to get early evidence from biomarkers on target engagement and an early read on efficacy.
Speaker Change: So once we have that in hand, then.
Speaker Change: If it looks the way that we we hope we would.
Speaker Change: Be working to accelerate the path forward to development and there is already some thinking and planning around that but of course it depends upon regulatory engagement and on the data that we get from the phase one trial.
Carl Hansen: But, of course, it depends upon regulatory engagement and on the data that we get from the Phase 1 trial.
Srikripa Devarakonda: Great, thank you so much. Thank you.
Speaker Change: Oh, great. Thank you so much.
Speaker Change: Thank you.
Josh: Our next question comes from Stephen Wiley with Stifle. You may now proceed. Hey, thanks for taking our question. This is Josh on for Steve. Work one on 635.
Speaker Change: Our next question comes from sticking Wiley with Stifel. You May now proceed.
Speaker Change: And thanks for taking our question this is Josh on for Steve.
Speaker Change: Quick one on <unk> three fives in terms of the development plan do you think you and I know you had said that you haven't really disclosed.
Josh: In terms of the development plan, do you think you, and I know you said that you haven't really disclosed the full plan just yet, but do you think you'd have to go into Healthy Volunteers first to kind of establish the preliminary PK, PD, and safety analyses? And then just to follow up on some of the questions related to biomarkers and target engagement, could you maybe just provide us with some color on what types of biomarkers you'll be looking at preliminarily to get a sense as to the target engagement here? and then I just have a follow-up.
Speaker Change: The full plan just yet, but do you think you'd have to go into healthy volunteers first to kind of establish their preliminary PK PD and safety analysis.
Speaker Change: And then.
Speaker Change: And then just a follow up on some of the questions related to Biomarkers and target engagement.
Speaker Change: Could you maybe just provide us with some color on what types of biomarkers, you'll be looking at preliminarily to get a sense as to the targeting decision here.
Speaker Change: And then I just have a follow up.
Carl Hansen: Sure, yeah, so the short answer is in the early part of the trial, we will be enrolling healthy volunteers, and, you know, connecting that with your second question, we expect to enroll both male and female healthy volunteers, and the most reliable biomarker of NK3R engagement would be testosterone levels. So, that's probably one of the early readouts that we get, which gives you some strong evidence of target engagement, but of course, that's not conclusive until you can show that that also translates into efficacy.
Speaker Change: Sure yes so.
Speaker Change: The short answer is.
Speaker Change: In the early part of the trial, we will be enrolling healthy volunteers.
Speaker Change: And connecting that with your second question.
Speaker Change: We expect to enroll both male and female healthy volunteers and.
Speaker Change: And the most reliable biomarker of engage our engagement would be testosterone levels. So that's probably one of the early readouts that we get which gives you some.
Speaker Change: Strong evidence of target engagement, but of course, that's not conclusive until you can show that that also translates into efficacy.
Carl Hansen: Great, thank you. And then just my follow-up was on the PSMA by CD3 T cell engager presentation, you guys made it AACR. Could you just maybe tell us about, and I know it's early, but is there anything you could tell us about which format you currently believe can have the best target profile in terms of threading the needle on both efficacy and safety as it pertains to CRS risk? And then, you know, is this, is this, you know, what's the timeline for maybe nominating a development candidate? And is there kind of an appetite for outlicensing with BD, or is this something that you maybe want to develop internally?
Speaker Change: Great. Thank you and then just my follow up was on the P. SMA by CD three T cell and Goodyear presentation, you guys made at ACR.
Speaker Change: Could you just maybe tell us about and I know, it's early but is there anything you could tell us about which format. You. Currently believe can have the best target profile in terms of threading the needle on.
Speaker Change: Both efficacy and safety as it pertains to Crs risk and then.
Speaker Change: Is this is this.
Speaker Change: Whats the timeline for may be nominating a development candidate and is there kind of an appetite for life.
Speaker Change: Licensing with BD or is this something that you maybe want to develop internally.
Carl Hansen: Yeah, I'll start with the question about format. And honestly, that is the multibillion-dollar question that everyone across the industry is trying to answer. At ACR, as in previous years, at a high level, there is increasing, I'd say, accelerating enthusiasm for TCE as a class. A lot of that has been driven by very exciting data in solid tumors. When you talk to all the different groups, it's also apparent that it doesn't look as though there's going to be one technology and one solution that is the magic bullet for every solid tumor or for every target. And many pharma companies and the big players who have committed to the space, and I would say that list is growing quickly, are placing multiple bets because you need to do these experiments in the clinic to find out what is working.
Speaker Change: Yeah, I'll start with the question about about format.
Speaker Change: And honestly that is the the multibillion dollar question that everyone across the industry is trying to answer.
Speaker Change: At ACR as as in previous years.
Speaker Change: At a high level, there is increasing I would say accelerating enthusiasm for TCE is a class a lot of that has been driven by very exciting data in solid tumors.
Speaker Change: When you talk to all the different groups. It's also apparent that.
Speaker Change: It doesn't look as though there's going to be one technology in one solution that is the magic bullet for every solid tumor or for every target.
Speaker Change: And many pharma companies and the big players, who have committed to the space and I would say that list is growing quickly.
Speaker Change: Placing multiple beds, because you need to do these experiments in the clinic to find out what is working.
Carl Hansen: Our approach to this has been to not cut corners, but to do the hard work to put in place the tools, the workflows, the assays, to start to systematically investigate which targets, which formats, which modalities, perhaps even combinations with co-stimulation are going to be needed to get efficacy and tolerable safety in the clinic. And that foundation is allowing us to make, in our shop, what I believe is some pretty rapid progress. But we are, of course, only one company in an ecosystem that's working on this problem, and we're also working with partners to solve this as well.
Speaker Change: Our approach to this has been to.
Speaker Change: Not cut corners, but to do the hard work to put in place the tools the workflows the assays.
Speaker Change: To start to systematically investigate.
Speaker Change: <unk>, which targets, which formats, which are.
Speaker Change: Which modality is perhaps even combinations with co stimulation.
Speaker Change: We're going to be needed to get efficacy and tolerable safety in the clinic.
Speaker Change: And that.
Speaker Change: That foundation is allowing us to make.
Speaker Change: In our shop, what I believe is some pretty rapid progress, but we are of course only one company in an ecosystem. That's working on this problem and we're also working with partners.
Speaker Change: To solve this as well so when.
Carl Hansen: So when... When we start to get, you know, a hook on the science or when the breakthroughs come, we're going to be very well positioned to capitalize on that. And we're already seeing, you know, some really promising results with some of the internal programs. You asked if we'd be open to licensing, licensing, or if we'd bring them into the portfolio, and I think both those options are on the table. I think I said in my prepared remarks, we see this as both a platform for building our pipeline, as well as for partnering. And we make those decisions based on, you know, the opportunity and the framework that I described in response to the previous question.
Speaker Change: When do we start to get.
Speaker Change: Ah hook on the science or win the breakthroughs come we're going to be very well positioned.
Speaker Change: To capitalize on that and we're already seeing some really promising results with some of the internal programs you asked if we'd be open to licensing.
Speaker Change: I would licensing or if we bring them into the portfolio and I think both of those options are on the table I think I said in my prepared remarks, we see this as both a platform.
Speaker Change: For for building, our pipeline as well as for partnering and.
Speaker Change: And we make those decisions based on.
Speaker Change: The opportunity and the framework that I described in response to the previous question. So.
Carl Hansen: So TBD there. But we are increasingly excited about the TCE space and it should be no surprise to anyone that if the class is to have the promise that everyone believes it does, which is to provide, you know, perhaps not curative, but very meaningful treatments to patients who have no options in cancer, that isn't something that's going to come easily. And it's going to take the combined efforts of many groups in the clinic as well as as well as in the lab. And so that's that's something we're committed to.
Speaker Change: TBD there, but we are increasingly excited about the D C space and.
Speaker Change: It should be no surprise to anyone that if.
Speaker Change: If the class is to have the promise that everyone believes that Doug which is to provide you know, perhaps not curative, but very meaningful treatments to patients who have no options in cancer.
Speaker Change: That isn't something that's going to come easily and it's going to take the combined efforts of many groups in the clinic as well as as well as in the lab and so that's.
Carl Hansen: And we think it's going to be a long game.
Speaker Change: That's something we're committed to and we think it's going to be a long game.
Josh: Okay, great. Thank you for taking the question. Thank you. There are no questions waiting at this time, so I'll pass the conference back over to the management team for any further remarks. No further remarks. Just thank you everyone for joining us today. We're excited about the progress and looking forward to the next call. Take care. That concludes today's conference call. Thank you for your participation. You may now disconnect your line.
Speaker Change: Okay, great. Thank you for taking the questions.
Speaker Change: Thank you.
Speaker Change: There are no questions waiting at this time, so I'll pass the conference back over to the management team for any further remarks.
Speaker Change: No further remarks, just thank you everyone for joining us today, we're excited about the progress.
Speaker Change: And looking forward to the next call.
Speaker Change: Take care.
Speaker Change: That concludes today's conference call. Thank you for your participation you may now disconnect your line.
Speaker Change: [music].