CytomX Therapeutics, Inc. (NASDAQ:CTMX) Q2 2022 Earnings Conference Call August 4, 2022 5:00 PM ET
Company Participants
Chau Cheng – Vice President of Investor Relations & Corporate Communications
Sean McCarthy – Chief Executive Officer & Chairman
Carlos Campoy – Chief Financial Officer
Conference Call Participants
Kaveri Pohlman – BTIG
Etzer Darout – BMO Capital Markets
Supawat Thongthip – Mizuho
Mitchell Kapoor – H.C. Wainwright
Operator
Good afternoon, everyone. Thank you for standing by. Welcome to the CytomX Therapeutics Second Quarter 2022 Financial Results Call. Please be advised that today’s call is being recorded.
I would now like to hand the call over to your host for today Chau Cheng, CytomX’s Vice President, Investor Relations and Corporate Communications. Please, go ahead.
Chau Cheng
Thank you, Yola. Good afternoon and thank you for joining us. Before we begin, I’d like to remind everyone that during this call, we will be making forward-looking statements. Because forward-looking statements relate to the future, they are subject to inherent uncertainties and risks that are difficult to predict and many of which are outside of our control. Important risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov. We undertake no obligation to update any forward-looking statements whether as a result of new information, future developments or otherwise.
Earlier this afternoon we issued a press release that includes a summary of our second quarter 2022 financial results and highlights recent developments at the company. We encourage everyone to read today’s press release and the associated materials, which have been filed with the SEC. Additionally, the press release and a recording of this call can be found under the Investors and News section of our website.
With us on the call today are Dr. Sean McCarthy, CytomX’s Chief Executive Officer and Chairman; and Carlos Campoy, Chief Financial Officer.
With that, let me turn the call over to Sean.
Sean McCarthy
Thank you, Chau, and good afternoon, everyone. Thanks for joining us for an update on recent progress at CytomX. The foundation of our work at CytomX is to destroy cancer differently.
With our innovative Probody therapeutic platform, we have blazed the new trail in oncology R&D and is now generally accepted that the conditional activation of biologics, offers tremendous opportunity for the development of new cancer therapeutics. At CytomX, we firmly believe that our multimodality Probody platform has the potential to deliver differentiated medicines for the treatment of people with cancer.
To ensure CytomX remains well-positioned for the future, as announced last month, we have made a series of recent changes with the organization to prioritize our R&D investments and capitalize on our extensive clinical experience to date with our platform technology.
Our restructured pipeline holds much promise for people with cancer and continues to span preclinical stage to Phase 2. CX-2029 is in the later stages of Phase 2 expansions and enrollment into the solid tumor cohorts has been completed.
Our collaborative work with Bristol Myers Squibb continues, including the randomized Phase 2 study of BMS-986249 and we’re also well underway with Phase 1 dose escalation for CX-904, our EGFR CD3 T-cell engaging bispecific.
In regards to our early-stage pipeline, our recent decision to deprioritize praluzatamab ravtansine now enables us to focus our resources and capital towards two exciting new wholly-owned programs CX-801 and CX-2051. And I’d like to spend a few moments focusing on these new opportunities.
CX-801 is our conditionally activated interferon alpha-2b, the lead program within our broad efforts in the cytokine field. Interferon alpha-2b is an approved immunotherapeutic that has demonstrated clinical activity in multiple cancer types and we believe, provides an orthogonal and potentially superior approach to cytokines like IL-2, IL-12 and IL-15 in activating antitumor immune responses.
At the cellular level, interferon alpha potently stimulates antigen-presenting cells to activate cytotoxic T-cells. Furthermore, interferon alpha combines effectively with checkpoint inhibition and offers tremendous potential to unlock checkpoint refractory and/or resistant cancers.
Despite its potential, however, the systemic toxicity of interferon alpha has limited its use to date. We’re therefore excited to have created CX-801, a conditionally activated master version of interferon alpha-2b, designed to harness the powerful activity of this potent immune modulator by increasing its therapeutic window.
The broad therapeutic window of CX-801 was highlighted in our poster presentation at AACR earlier this year and we aim to rapidly advance this potentially best-in-class program towards clinical evaluation, with IND filing targeted for the second half of 2023.
Switching now to 2051 — CX-2051, a conditionally activated antibody drug conjugate targeting EpCAM with potential applicability across EpCAM-expressing epithelial cancers. EpCAM has been regarded as a high-potential oncology target for decades and has been clinically validated by others.
For example, the locally administered anti-EpCAM antibody toxin fusion protein opituzumab monotox has demonstrated robust clinical activity in non-muscle invasive bladder cancer. However, efforts to generate systemic anti-EpCAM therapeutics have to date not been successful due to toxicities to epithelial tissues.
This is because EpCAM, or epithelial cell adhesion molecule, as the name suggests, is present on the majority of normal epithelial cells and conventional anti-EpCAM biologics administered systemically have significant dose-limiting toxicities.
We’re applying the learnings from our clinical studies with praluzatamab ravtansine and CX-2029 in the design of CX-2051 and we’ll have more to say about the molecular configuration of this drug candidate in the future. We plan to file an IND for this novel ADC in the second half of 2023.
A key theme that connects our two newest programs CX-801 and CX-2051 is that both targets have a level of validation that we believe increases the probability of future clinical success and we are excited to be moving these programs forward.
Now returning to our later-stage pipeline where we continue to work intensively with our partners to advance multiple novel programs in the clinic. This past quarter, we introduced into the clinic CX-904, the third therapeutic modality from our versatile Probody platform.
CX-904, which is partnered with Amgen, is our conditionally activated T-cell engaging bispecific antibody designed to target the CD3 receptor on T-cells and the epidermal growth factor receptor on cancer cells. This target combination is intended to activate antitumor T-cell responses in EGFR-positive cancers.
In Q2, we treated the first patient with CX-904 and Phase 1 dose escalation is ongoing with the goal of assessing safety and selecting a go-forward dose for subsequent expansions.
Moving on to BMS-986249, our CTLA-4-targeting Probody candidate licensed to Bristol Myers Squibb. CTLA-4-targeted therapy is a foundational immuno-oncology strategy and treatment with ipilimumab as a monotherapy or in combination with nivo has resulted in clinically meaningful antitumor activity in a variety of malignancies.
The durability of responses to anti-CTLA-4 therapy continues to highlight the importance and uniqueness of this target. However, CTLA-4 blockade has a narrow therapeutic window and we believe that broader potential of CTLA-4 therapy could be realized through the application of our Probody platform.
BMS continues to evaluate 249 in a randomized Phase 2 study in combination with nivo versus ipi plus nivo in patients with newly diagnosed advanced melanoma. BMS previously reported Phase 1 safety data for 249 at ASCO 2020, showing the CTLA-4 targeting Probody was well tolerated at elevated doses both as monotherapy and also in combination with nivo.
At ESMO 2022, BMS plans to present updated Phase 1 results for 249 in a poster presentation. In early 2021, BMS extended the evaluation of 249 plus nivo to advanced hepatocellular carcinoma, castration-resistant prostate cancer, and triple-negative breast cancer.
And BMS also continues to study BMS-986288 the non-fucosylated CTLA-4 targeting Probody in a Phase 1 dose escalation study both as monotherapy and also in combination with nivo in patients with advanced solid tumors.
Now continuing on to CX-2029, our CD71 or transferrin receptor directed ADC, which is partnered with AbbVie. Enrollment into the overall CX-2029 Phase 2 expansion study has now met its objectives in all three solid cancer indications, including the esophageal/gastro-esophageal junction cancer cohort.
The diffuse large B-cell lymphoma cohort has been deprioritized due to strategic and competitive reasons and did not enroll any patients. A data update for the squamous lung cohort is expected in the fourth quarter of 2022 and data from the esophageal and gastroesophageal junction cancer cohort continues to mature.
With that, let me hand over to Carlos, who will provide you with a financial overview for the quarter.
Carlos Campoy
Thank you, Sean. As of June 30, 2022, we had $228 million in cash, cash equivalents and investments. Our recently announced restructuring efforts that Sean mentioned earlier, should allow us to extend our cash runway to 2025. This runway forecast does not include any potential upfront or milestone payments from existing or future partnerships.
For the second quarter of 2022, revenue was $18 million compared to the $16 million for the corresponding period in 2021. The increase was largely related to the CD71 collaboration with AbbVie. R&D expenses increased $5 million to $31 million during the three months ended June 30, 2022 compared to Q2 2021.
The increase was primarily due to higher personnel-related expenses and laboratory contract services in support of our preclinical and clinical pipeline. G&A expenses were $11.7 million during the second quarter of 2022, an increase of $2.4 million over Q2 2021. The increase was mainly in personnel and professional expenses.
Let me now turn the call back to Sean.
Sean McCarthy
Thanks Carlos. In closing, we believe our recent decision to restructure CytomX puts us in the strongest possible position to maintain our technological leadership in conditional activation of oncology therapeutics and to advance our robust pipeline with substantial potential for patients.
We’re proud of the significant progress we continue to make building on the consistent achievement of technical milestones, including six INDs filed across three therapeutic modalities, four programs that have advanced to Phase 2 studies and more than 500 cancer patients who have been treated with our product candidates to date.
Our corporate partnerships remain strong and we will continue to emphasize new business development as an integral part of our corporate strategy.
As we’ve said before, we care for every patient, we learn from every patient and we deeply thank everyone involved in our efforts to make the biggest difference we can. We are committed to destroying cancer differently for the benefit of people living with cancer, and we remain firmly focused on building CytomX for the long-term.
Operator, let’s now open the call up for questions.
Question-and-Answer Session
Operator
Thank you. [Operator Instructions] Your first question comes from the line of Kaveri Pohlman from BTIG. Please ask your question.
Kaveri Pohlman
Yeah, good afternoon. Thanks for the update and for taking my question. For CX-904, can you provide any insight into the study that’s ongoing? Are you starting with therapeutically relevant doses and how many dose levels you plan to test?
Sean McCarthy
Yes. Hi, Kaveri. Thanks for the question. So we’re, obviously, very pleased with the progress on 904 now being in the clinic and in the early stages of dose escalation. We haven’t disclosed any significant details of the Phase 1 strategy just yet. I can say though that we are starting at a pretty low starting dose. We do — I think it’s important to be thoughtful in dose escalation with a modality like this. And I think that’s very consistent with for example the update — the exciting update we heard yesterday from Regeneron regarding their co-stimulatory strategies as well in terms of one needs to take it stepwise and learn in a very progressive way.
Kaveri Pohlman
Got it. And maybe a follow-up. Based on your preclinical safety studies, what toxicities and/or DLTs you expect to see? And in terms of CRS rate, is there something you can point to that you would clearly say beforehand is good data?
Sean McCarthy
We haven’t really guided on what good data is going to look like. Like I said I think we need to take this program stepwise. I would emphasize that this is a Phase 1 study with a molecule that we expect to be highly potent as a T-cell engager. And so we are laser-focused in Phase 1 on safety. The data that we’ve presented previously on this general therapeutic concept of EGFR and CD3 is actually with a different preclinical molecule. We haven’t disclosed yet the data or the architecture if you like of 904. We will do so in the future.
But if you look at that previously disclosed data on the therapeutic concept of EGFR and CD3, we’re obviously very focused on cytokine induction. And you can see in that previously presented data very, very substantial shifts in improvements in safety with the marketing strategies that we have employed. But, of course, in the clinic we’ll be focused on all of these parameters as we move carefully and thoughtfully through this initial dose escalation phase.
Kaveri Pohlman
Got it. Thank you.
Operator
Your next question comes from the line of Etzer Darout from BMO Capital Markets. Your line is now open.
Etzer Darout
Great. Thank you for the question. So just wanted to get an update from you on benchmarks for the CX-2029 data in squamous non-small cell lung cancer. And I guess what you would characterize as good data on this upcoming update in the fourth quarter? Thank you.
Sean McCarthy
Yes. Hi, Etzer thanks for the question. So I think as we’ve discussed previously in the data release that we presented towards the end of last year, just to recap that data, we presented — announced data on 16 efficacy-evaluable patients towards the goal ultimately of enrolling 25 in that particular cohort. And we’ve announced previously that we are now and reiterated today that we’ve fully enrolled that cohort.
But at the time of those 16 efficacy-evaluable patients we saw a response rate of just under 19%. So we saw three confirmed partial responses. And we had guided previously going into that update last year that a response rate of the 20% range would be clinically significant and very meaningful. And so we’re right in that ballpark with that initial result.
One could argue actually that that benchmark could even be a little bit lower, maybe towards 15%. And why is that? Well, because the patients that were enrolled, all 16 patients who had prior checkpoint inhibitor experience. And this is an emerging, of course, patient population where the unmet need is very significant where one would expect responses to chemo for example to be in the low double-digits. So with the full cohort data the full 25 patients, we’ll be very pleased if we maintain the response rate in the range of what we’ve already disclosed.
Etzer Darout
Great. Thank you.
Sean McCarthy
Thank you.
Operator
And our next question comes from the line of Mara Goldstein from Mizuho. Your line is open.
Supawat Thongthip
This is Supawat for Mara. My first question is on the CX-2029. How do you plan to disclose the data in the fourth quarter? Is it going to be like similar to last year by the press release, or is it going to be at the conference venue have you decided on that?
Sean McCarthy
No comments on that at this point. As you can hear we’re maintaining our guidance of presenting or sharing data by the end of the year. We will be — now that the — as we’ve announced today now that the enrollment into the — all three of the solid tumor cohorts specifically head and neck lung and esophageal has been completed, we’ll obviously be sitting down with our partner AbbVie later in the year to review data and start to think about next steps and disclosure strategy will be a part of that discussion as well. So there’s no additional comment I can make at this stage.
Supawat Thongthip
Got it. And then one more on that. So with regard to the esophageal and GEJ arms when do you expect they’d be mature enough to be disclosed publicly?
Sean McCarthy
Yes. I can’t comment on that yet other than to say that the cohort is fully enrolled and the data continues to mature.
Supawat Thongthip
Got it. And then one more on BMS-962249. I was wondering if you can provide maybe additional color on the type of data that you plan to share or due in Bristol plan to share and perhaps a bit more color in terms of the tumors breakdown if you could?
Sean McCarthy
Well, there’s two things to say there, one which we mentioned in the call today that BMS did present the Phase I safety data at ASCO 2020. They will be presenting an update on the Phase I study, which obviously is now considerably more mature at ESMO coming up in a few weeks.
With regard — and as has been previously disclosed that patient population was a fairly typical Phase 1 study population for evaluating novel immunotherapy. So the usual mixed bag of tumor types.
Of course, the Phase 2 study that they’re running the randomized Phase 1 study of 249 is being conducted in frontline metastatic melanoma. That study continues to enroll and we will provide an update on timing of data as and when we have it.
Supawat Thongthip
Got it. Thank you.
Operator
Your next question comes from the line of Mitchell Kapoor from H.C. Wainwright. Your line is open.
Mitchell Kapoor
Hi. Thank you for taking the questions. I just wanted to know if you could remind us of the differentiation of the second EpCAM ADC versus the first generation? And what cancers might be a best fit for this program based on the design and the signature ratio?
Sean McCarthy
Yes. Thanks Mitch for the question. So I think, you’re referring to we’ve previously discussed and in fact we presented some data on a program we call CX-2043 an anti-EpCAM Probody drug conjugate or conditional ADC with the payload — the maytansine payload DM21. Very important and impressive data set pre-clinically.
We have moved on from that particular configuration to 2051, which we believe will have an even broader therapeutic window, and we’re not yet ready to disclose the molecular architecture of 2051. We will have a presentation at the World ADC Conference coming up in San Diego in September. And we will be saying more about 2051 at that conference. In the context of the learnings that we have — the many learnings we have from the 2009 and 2029 programs in the clinic.
Mitchell Kapoor
Thank you. And for the squamous non-small cell lung cancer data, could you kind of walk us through what expectations you might expect to see if you were to look at patients by CD71 status? And to the degree that you could comment on those analyses that we might see at the data set that would be helpful.
Sean McCarthy
Right. So, of course, as with any new target like CD71 we are highly interested in studying and understanding any relationship between target biology and anticancer activity. That work is ongoing. I can’t say yet when we’ll be ready to share that data. The study analysis is continuing, but that is something that is of course of high interest to us.
Mitchell Kapoor
Thank you so much, Sean.
Sean McCarthy
You’re welcome.
Operator
Your next question comes from the line of Peter Lawson from Barclays. Your line is open.
Unidentified Analyst
Hey, good afternoon, guys. Thanks for taking the question. This is Alex on for Peter. Two questions for me. Just on CX-2029 and the update in lung cancer. Wondering if you could speak a little bit about safety and specifically anemia? And if you could talk about what would be acceptable in terms of the rate and grade of anemia to make this program move forward?
Sean McCarthy
Yes. Hi, Alex, thanks for the question. So something that we continue to learn about continue to evaluate in regards to understanding mechanistically the anemia and also potential mitigation strategies, we’ve discussed this quite a bit in the past in our previously reported clinical work, the anemia has been managed through various means, including dose reductions, dose delays, erythrocyte stimulating agents.
We did conclude earlier this year that probably the ESA route is unlikely to help as much as we might have liked. We continue to look at dose reductions, dose delays. And once we look at the full data set across all of the solid tumor cohorts, I think, we’ll be in a better position to comment little bit later in the year.
Unidentified Analyst
Okay. Great. Thank you. And then just a second question on business development. You’ve previously talked about remaining active in BD discussions. You obviously have a number of partnerships that — where you partner your technology. I’m just wondering if you could speak to any interest in terms of looking at bringing in new technology externally. Or are you mostly focusing on partnering your technology to larger pharma players? Thank you.
Sean McCarthy
Yes. So, great question and I think a couple of different components to that question. So, first of all, I would emphasize that the restructuring that we have announced recently just reemphasize that that puts us in a robust cash position into 2025. And that does not assume — that guidance does not assume any additional business development cash inflows or any — or indeed any milestones so many existing deals that we have.
We do continue to be interested in leveraging the platform for additional business development in a strategic way. We continue to believe based on the progress we’ve made, and based on the discussions that we have over time that our technology is extremely relevant. I think if you look at the evolution of the ADC field, the evolution of the T-cell engager, and even co-stimulatory field that we heard about yesterday from Regeneron, and also the evolution of the cytokine field, we have a technology platform that we continue to believe can add significant value to these three areas.
So there should be opportunities over the course of our cash runway, should we choose to take them to do additional deals that could generate non-dilutive capital. We’ll see. I’ve always said we’ll do the right deals at the right time.
With regard to bringing in technology, we continue to follow the conditional activation space very carefully. I think we’re in pretty good shape there in terms of the investments we’ve made internally. We have an industry-leading platform. And so I can’t really comment on any other activities that we may have there at this stage.
Unidentified Analyst
Great. Thank you.
Sean McCarthy
You’re welcome.
Operator
At this time, I would like to hand the call back over to Chau Cheng for his closing remarks.
Chau Cheng
So on behalf of the executive team, I’d like to thank you all very much for joining us this afternoon. We look forward to updating you in the future on our ongoing progress.
Operator
This does conclude today’s conference call. Thank you for participating. You may now disconnect, and have a great day.
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