Q1 2025 Evaxion Biotech A/S Earnings Call
Satsang with Mooji
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Speaker Change: Good day and thank you for standing by. Welcome to Day of Action, first quarter 2025 conference call and webcast. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be the question and answer session. To ask a question during the session, you will need to press star one one on your telephone keypad. You will hear an automatic message advising your hand is raised.
Speaker Change: To withdraw a question, please press star 11 again. Please be advised to the conference has been recorded.
Speaker Change: I would not like to hand a conference over to your first speaker today, Christian Kanstrup. See you, please go ahead.
Speaker Change: Thank you so much and good morning and good afternoon everyone and very warm welcome to this
Speaker Change: On the back of our Q1 2025 results, I'm Christian Kanstrup, CEO of Evaxion
Speaker Change: With me today, I have Ed Schuscher, Birgitte Rono, our chief science officer, Thomas Schmidt, chief financial officer, and Mads Kronborg, our VP of Investor Relations and Communications.
Kristian Kanstrup: And for the agenda today, I will do the introduction, Birgitte, she will be doing the R&D update.
Kristian Kanstrup: Thomas will take her through the numbers and I will end up concluding before we again, as usual, we'll jump into the Q&A.
Kristian Kanstrup: And before we get going, I will direct the attention to this slide. We will be talking about forward-looking statement. And as always, when we talk about the future, that is, on certain hand, I direct your attention to the slide here.
Kristian Kanstrup: But with that, let's go curing and let's look at the introduction.
Kristian Kanstrup: I think it's fair to say that we have had a super basic couple of months since the last business update.
Kristian Kanstrup: are continuing to execute well. If we first look at business development, very pleased to say that the partnership with Merck is on track towards potential option exercise in the second half of the year.
Kristian Kanstrup: Compound in the optional licensing agreement, we will be in time to receive $10 million USD. Hence a very important milestone, and I am pleased to see that we are tracking towards the decision point in the second half of the year.
Kristian Kanstrup: Also, super pleased to see that our business development pipeline remains solid and it supports our full-year target of at least two new business development deals.
Kristian Kanstrup: However, in that context, I also have to direct attention to the fact that it is clear that the current turmoil in the financial markets
Kristian Kanstrup: is impacting deal execution. We have seen a potential partner which we have been in discussions while deciding to pause discussions and focus on internal data states assets in development.
Kristian Kanstrup: I think it's only natural that you would see decisions like that when there is turmoil in the financial markets and some uncertainty surrounding where we are.
Kristian Kanstrup: That being said, we are of course mitigating the risk of that by directing focus towards potential partners less impacted by the current macro environment and as I said.
Kristian Kanstrup: We remain confident about our full year target of completing at least two new business development deals, but it's clear risk is increasing due to the macro environment.
Kristian Kanstrup: From an anti-point of view, very pleased to see that EVXO-1 is continuing to yield positive data with just presented at the AACR in April and other set of strong data, and Biggitte will get back to those later on in the presentation here.
Kristian Kanstrup: On top of that, we are on train for the two year readout in the second half of the year and we have seen the first patient being those in the one year trial extension.
Kristian Kanstrup: Also important from an R&D point of view is to deploy our AI-inulti platform to develop new pipeline candidates.
Kristian Kanstrup: Having a pipeline of novel candidates is crucial for our ability to continue our multi-partner approach and generate future business development income.
Kristian Kanstrup: Also here, I'm pleased to say that we are on track for selecting the new infectious disease pipeline candidate which we will add to the pipeline here in the first half. Again, together we will get back to that later on as well.
from a platform point of view.
It's about the continued optimization and improvement of the platform.
Kristian Kanstrup: That is how we ensure that we have a leading AI platform for Nobel target discovery.
and Development.
Kristian Kanstrup: From a financing point of view, finally, cash at hand until mid-2026.
Kristian Kanstrup: The EIB loan conversion we have talked about earlier is still expected to be completed in Q2.
Kristian Kanstrup: So all known, basic couple of months, but also couple of months where we continue to see study traction across all parts of the business.
Kristian Kanstrup: Well, we also have been doing during the past couple of months as we have been quite active at various scientific conferences.
Kristian Kanstrup: AACR, Evaxion 1, Phase 2 data, here we actually presented that 80% of the new antigens elicit an immune response.
Speaker Change: As you will see in beginners' presentations, very strong data presented at that conference. We were at the World Vaccine Congress, had two presentations, had a man boost, we were at the Next Gen Biomed Conference also with two presentations.
These
Kristian Kanstrup: Participations at scientific conferences are crucial both for our interaction with the scientific community in general, but also very much.
Kristian Kanstrup: for the continued solid execution upon our multi-partner strategy because this allows us opportunity for engaging with possible partners at the various conferences. We will continue to have a very active presence at conferences throughout the year.
Kristian Kanstrup: Before handing over to Biggitte, just a quick look at our 2025 milestones. Here, please to say that we have delivered on the first two milestones for the year we are on track with the first infectious disease pipeline candidate.
Birgitte: And even though it has been a busy first half, it's very clear the second half is going to be even busier.
Birgitte: We have, as I already used to, key milestone in the Merck decision on Auction Exercise, coming up in the second half, EVX01 Phase II, two year readout.
Kristian Kanstrup: Also, the selection of the lead candidate for a Precision Earth Cancer Vaccine Concept.
Kristian Kanstrup: and Business Development continue strong focus on generating new partnerships and we have our target of these two new agreements in 2025 in addition to
Kristian Kanstrup: Yet another infectious disease candidate in the second half of the year being entered into the pipeline.
Kristian Kanstrup: So while it was busy, first off, it's going to be even more busy time ahead. We are looking very much forward to that, and with that, I will hand over to you, you begin this for an update on all the exciting things that have happened from an on-deep point of view.
Bhagith: Thank you, Christians. So we have a very broad R&D pipeline of AI immunology-defined vaccines, spanning tool key disease areas, cancer and infectious diseases.
Bhagith: So today I walk you through some of the latest progress in these key R&D programs. I'll start with EVX01, our personalized peptide-based cancer vaccine currently in Phase 2.
Kristian Kanstrup: And then I will also touch on our advancement in our precision cancer vaccine program targeting this novel class of tumor antigens that are shared across patients. And then lastly, I will present our purpose in expanding our infectious disease vaccine pipeline.
Kristian Kanstrup: So, Evaxion I, as mentioned, is currently in phase two and is being developed as a first line treatment for advanced melanoma.
Kristian Kanstrup: The EDXO-1 vaccine includes multiple patient-specific vaccine targets, so-called new antigens, that we have identified using our AI Immunology platform.
Kristian Kanstrup: It's being administered in combination with immune checkpoint inhibitors with the goal of enhancing clinical efficacy.
Speaker Change: And as Christian mentioned, we presented a biomarker and digital immune data at the annual meeting in the American Association of Cancer Research.
Speaker Change: And at this meeting, we reported that Evaxion won in juice a specific immune response in all the patients assessed so far.
Speaker Change: and that 80% of the vaccine target triggered a specific immune response, and that is a frequency that is substantially higher than what has been reported for other similar vaccine candidates.
Speaker Change: Furthermore, immunizations increased and maintained the boldness of the vaccine-induced chiseled responses.
Speaker Change: And with these data, we are tracking towards the two-year clinical data that we will report in the second half of this year.
Speaker Change: So, building on these positive data and to further explore the durability of both the new response and the clinical responses, we have, as Christian mentioned, extended this trial with one additional year.
And we now have those.
Speaker Change: The first patient with this extra EVX01. Notably, during this extension phase EVX01 will be administered as immunotherapy, allowing us to better understand the vaccine's standalone ethics.
Kristian Kanstrup: Also, the extension involves minimal additional costs as clinical sites remain active and the vaccine production is already complete.
Kristian Kanstrup: So we're looking very much forward to sharing updates from this program in the second half of 25.
Kristian Kanstrup: So let's turn our focus to our promising precision vaccine concept.
Kristian Kanstrup: So in this program we are using AI Immunology to design a precision cancer vaccine targeting this novel in non-conventional class of antigens, so-called IRF tumor antigens.
Kristian Kanstrup: that are shared across patients in select indications. And this approach could allow for broader use of cancer vaccines also for patients that are less likely to respond to conventional cancer immunotherapies.
So in this program we have...
Kristian Kanstrup: obtained proof of concept, demonstrating that mice that are immunized with an Earth-based vaccine, they are protected from tumour and also that we induce a specific thesis or response in these mice.
Kristian Kanstrup: Further on, we have now curated transcriptomic and proteomics tumor data from more than 3,000
Kristian Kanstrup: and additionally to identify these very evid strokes that are presented to the immune system we have analyzed more than a thousand immunopathidomic data.
Kristian Kanstrup: And with this data at hand, we have optimized AI immunology to allow for an improved version of a human-lead vaccine candidate containing multiple herb evitokes and that also has a broad A to A coverage.
Kristian Kanstrup: So in parallel with designing and optimal lead candidate, we are preparing for clinical clinical entries and have initiated IND and CTA enabling activities including C&C and Clinical Child Planning.
Thank you. Thank you. Thank you.
Kristian Kanstrup: So lastly we are making strong progress in expanding our infectious disease, vaccine pipeline and we have the first of two planned new vaccine candidates is contract for launching in the first half of this year.
Kristian Kanstrup: And this evaluation included an analysis of medical needs, commercial potential, competitive landscape, platform applicability and both clinical and pre-clinical feasibility.
Kristian Kanstrup: So based on this analysis, we now have shortlisted the most promising virtual targets, and these have been reviewed and discussed with an expert advisory panel to guide the final selection.
and more to come on this in the near future.
Kristian Kanstrup: So in summary, we have seen significant progress across our pipeline in both oncology and infectious diseases, and with the two major milestones completed in 25 and significant progress made across the program, we are well on track for our next milestones in the second half of this year.
Kristian Kanstrup: And we are of course looking forward to updating you as our programs continue to advance.
Speaker Change: Thank you so much, Birgitte. I think it's fair to say no doubt that AI, Immunality, really holds the potential for developing.
Kristian Kanstrup: Truly novel precision medicines and it's great to see the progress in the pipeline. Let's search for some progress in numbers and hand over to Thomas to take us through the Q1 results please.
Yes, thank you, Christian.
So moving into the financials from the Q1 to 2025.
Kristian Kanstrup: Let me start with the key highlights that we had and have seen in the Q1.
Kristian Kanstrup: First and foremost, our cash position, we have significantly improved in the first quarter due to our capital market activities in Q1, and namely even in January . So we have a cash position of...
Kristian Kanstrup: 17.8 million up from 6 million by the end of the year 2024.
Kristian Kanstrup: This also means that we have cash runway until mid-2026, which really also means its potential, its past potential exercise of options from MSD, and also the Evax-01-2-year clinical data we have.
Kristian Kanstrup: In Q1, we've seen less spending if we compare it to Q1 2024 as some of our, most of our projects have higher spending planned in the upcoming quarters.
Kristian Kanstrup: Our equity has certainly also benefited from our capital market activities. So, end of Q1, we have total equity of $10.3 million, which is again a significant strengthening versus the end of 2024.
Kristian Kanstrup: If I dig a little bit further into the profit and loss statement of Q1, we have recorded an operating loss of 3.9 million which should be compared to 4.4 million last year.
Kristian Kanstrup: Again, the overall lower operating expenses in Q1 is really the result of this, but we do expect that the project cost will pick up an increase in the coming quarters, fully aligned with our planning.
Kristian Kanstrup: Any potential income from business development deal, so that will come in excess to that.
Kristian Kanstrup: In the Q1, we also have financial income of $2.4 million and this has come mainly from a reassessment of derivative liability.
Kristian Kanstrup: Capital Marketing Activity in Q1, and it impacts also the financial income.
Kristian Kanstrup: and we would expect to see further impact due to reassessment of our derivative liability in the upcoming quarter as we still have approximately 50% of the derivative remaining.
Kristian Kanstrup: which compares to an income of 1.2 million last year but also due to that we last year had a significant
Kristian Kanstrup: Financial income again, also from a derivative liability and reassessment of 5.6 million last year.
Kristian Kanstrup: So, at least from an operating loss point of view, we are in a better position this year.
Moving then to the balance sheet, the items.
Kristian Kanstrup: As mentioned already, strengthening equity really has been a good step forward and with a 10.3 million dollars we have in net equity in the Q1, we are well above also the Nasdaq listing requirements and also the Nasdaq listing requirements are completely withdrawn. So the determination issue.
Kristian Kanstrup: Invest the warrants in our public offering had an exercise price denominated in the US dollar.
Kristian Kanstrup: We have a functional currency in Danish crowns, which then also according to international accounting financial standards means that we have recorded these investor warrants as a derivative liability.
quarter
Kristian Kanstrup: It is important to note that as we still have approximately 50% of our warrants still denominated in US dollar, we will see reassessment and we will need to do reassessment in the upcoming courses. Again, net impact is limited but this is expected in the upcoming course.
Kristian Kanstrup: Cash and cash, as mentioned, 17.8 million to really, really nice to see also that we have cash until mid-2026 in the current one runway setting.
Christian: And with that, I then handed back to Christian for concluding remarks.
Christian: Thank you so much, Thomas, for taking us through the numbers and let me just conclude before opening up the floor for Q&A.
Christian: I do hope that you agree with me from the presentation here that we are maintaining the strong execution, momentum, also our financial position with significant increase in the...
Christian: Cash and equity has been clearly moving in the right direction.
Christian: So we are tracking towards several potential value catalysts coming up in the second half of the year.
Christian: which is derived from our clear strategy with a strong focus on value realisation through our multi-partner approach.
Also, when talking about cash, our runway into mid-2026
Christian: is beyond both the two-year readout on eBay, so one, and the potential option exercise from Merrick, which would bring us an additional 10 million if both options are exercised for eBay's B2 and B3, which in turn would give us cash into 2027.
Christian: So with that I would like to open the floor for Q&A.
Christian: Thank you. Dear participants, as you are wanted, if you wish to ask a question, you will need to press star 1-1 on your telephone keypad and wait for a name to be announced. To answer your question, please press star 1-1 again.
Christian: Once again, if you wish to ask a question, please press star 1-1 on your telephone keyboard.
Speaker Change: Now, we're going to take our first question. And it comes to the line of Thomas Flaten from Lake Street Capital Market. So, the line is open. Please, ask your question.
Speaker Change: Good morning, good afternoon. Thanks for taking the questions. A few for Birgitte here. In the two-year EVXO1 data, was there a meaningful bias between CD4 and CD8 positive T cells?
Speaker Change: We mainly see CD4 T-cell. So in all the patients, we have all the samples from the patients, we have analyzed so far, we have CD4.
Speaker Change: Next one, that's very helpful. Thank you. And then on the lead herb candidate that you have, is it the intention that that will be a herb hotspot vaccine only or will you combine that with personalized cancer and new antigens?
Speaker Change: So the idea with this physician concept is to do a of the shelf vaccine. So we basically are able to design a vaccine that has what we called broad coverage.
Speaker Change: Meaning that patience with a different immune system and also expression profiles of these.
Speaker Change: Chuma Antigen would benefit from receiving this type of therapy. So it is a precision-based vaccine and we will at least not in the beginning combine it with any other types of vaccines including personalized approaches.
Speaker Change: Understood. And then one final one for me. There was news last week out of the UK that they were going to repurpose a meningitis vaccine for gonorrhea. It looks like it provides limited protection. I was just curious if you had any thoughts on that or what maybe your partners of Merck might have said about that, that roll out.
Speaker Change: Before, before, begin to speak to the scientific content, then I can just say, Thomas, I mean of course this is just...
Speaker Change: shows the level of desperation for having some effective therapy for preventive therapy for conorrhea, right? Looking at the numbers.
Speaker Change: that also one disclosed for the number of cases in the UK, it's a pretty significant increase, so fear that something needs to be...
We done and of course it is gifts us
Speaker Change: and a lot of comfort regarding the commercial potential for EVXB2 and then begin the scientific rational, which of course is there, but the scientific rational is there and it has also been known for a while that there is cross-protection.
Speaker Change: to Ghanaia, but it's far from complete, meaning that there is definitely a need for a more precision vaccine that would give a broader protection.
We have not discussed it with our collaborators at SIMC.
Got it. Thanks for taking the questions.
Thank you.
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Speaker Change: The participants, as a reminder, if you wish to ask a question, please press star 1-1 on your telephone keypad.
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The End
Satsang with Mooji
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Satsang with Mooji
Speaker Change: We are looking very much forward to the continued execution upon our strategy and will of course...
Speaker Change: Keep you all informed when relevant news unfolds and are looking forward to staying in touch with all of you. So thank you so much for all of you taking the time for listening in and wish you all a good day.
Speaker Change: This concludes today's conference call. Thank you for participating. You may now disconnect. Have a nice day.