Chris Ogden; Senior Vice President - Finance and Accounting; CytomX Therapeutics Inc
Sean McCarthy; President, Chief Executive Officer, Director; CytomX Therapeutics Inc
Amit Dayal; Analyst; H.C. Wainwright & Co.
Good afternoon, everyone. Thank you for standing by. Welcome to CytomX Therapeutics third quarter, 2024 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. Chris Ogden CytomX, Chief Financial Officer. Please go ahead.
Thank you. Good afternoon and thank you for joining us.
Before we begin. I would 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 our control.
Important risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov we do not take 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 third quarter, 2024 financial results and highlights recent progress at atomic.
We encourage everyone to read today's press release and the associated materials which have been filed with the SEC. Additionally, the press release recording of this call and our sec filings can be found under the investors and news section of our website.
With me on the call today is Dr Sean A. McCarthy CytomX is Chief Executive Officer and Chairman Sean will provide an update on our pipeline and company progress. Before I walk through the financials for the third quarter, we will then conclude with a Q&A session with that. I will now turn the call over to Sean.
Thanks Chris and good afternoon, everyone.
As always, we are very pleased to be here today to provide an update on CytomX progress as we advance towards our vision of transforming lives with safer, more effective therapies.
Since our inception and the creation of the PROBODY therapeutic platform. We have been leaders in the field of masked conditionally activated biologics and our team has been working tirelessly to address areas of oncology with high unmet need, leveraging our multi-modality PROBODY platform.
We have more than 15 active discovery and development programs across our internal and partnered research pipeline with 3 of these programs currently in phase 1 physical development CX-904 PROBODY T-cell engager targeted to EGFR and CD-3, CX-2051, an EpCAM directed PROBODY antibody drug conjugate and also CX-801 our PROBODY interferon Alpha-2b.
Each of these programs really stands on the shoulders of our broad platform and clinical experience to date with mass therapeutics. And we continue to push boundaries. In our quest to make the biggest difference we can for cancer patients.
The site services pipeline is poised to deliver multiple clinical readouts in 2025 that will inform next steps for later phase clinical development and create significant value for shareholders.
Now, moving to our pipeline updates for the quarter, I will start with our work in the T-cell engager space.
The field of T-cell engagers in solid tumors has seen meaningful advances over the past 1 to 2 years but there remains a scarcity of really good tumor targets for conventional unmasked T-cell engagers because of target expression in normal tissues.
At CytomX, we are applying our PROBODY therapeutic platform to mask T-cell engagers directed against highly expressed solid tumor targets in order to maximize their activity in tumors and minimize systemic toxicities in normal tissues.
We are working on multiple T-cell engager programs including CX-904. Our mast PROBODY T-cell engager targeting EGFR and CD-3, which is partnered with Amgen in a global Co Development alliance.
EGFR is a well validated target in multiple cancer types. Nobody has yet been able to develop a T-cell engager against this target. So, we are breaking new ground with this program.
CX-904 is designed with a single EGFR binding arm and a single CD-3 binding arm and both are masked in a protease dependent manner allowing for tumor activation.
In May, this year, we shared a first look at safety and efficacy for this clinical program. Announcing positive Phase 1A dose escalation data from 35 patients that showed an emerging favorable safety profile and encouraging early signs of single aged anticancer activity at doses up to 10 mg.
Since our May. Data disclosure dose escalation has continued, and we have been focusing enrolment on patients with Pancreatic ductal adenocarcinoma, non-small cell lung cancer, head, and neck squamous cell carcinoma.
We are pleased to report that the 15 mg step dosing cohort has cleared. A maximum tolerated dose has not been reached for step dosing and escalation continues since the escalation is continuing. We do not expect any decision in 2024 regarding initiation of phase 1B, we continue to engage with our partner and gen regarding plans for CX-904. And we look forward to providing additional updates on the program next year, including potential phase one B initiation.
I would like to turn now to CX-2051. Our wholly owned first in class antibody drug conjugate targeting epithelial cell adhesion molecule or EpCAM developing therapies targeting EpCAM has been a goal of cancer research and development since its first identification as a highly expressed colorectal cancer.
More than 40 years ago, EpCAM is a highly attractive drug target due to its high expression in many solid tuber types, including colorectal cancer, non-small cell lung cancer, ovarian cancer, triple negative, breast cancer, and gastric cancers.
EpCAM has been implicated in many aspects of cancer biology, including signal transduction cell proliferation and epithelial mesenchymal transition. And it is particularly highly expressed in colorectal cancer.
In fact, we estimate that more than 90% of CRC patients have high level EpCAM expression.
Furthermore, we know that if EpCAM can, can be engaged successfully and safely, it can lead to tumor responses in patients. As best demonstrated by the anti EpCAM toxin fusion of Auzam moot that elicited a 40% complete response rate in Non muscle invasive bladder cancer because of its systemic toxicity. Though this drug needed to be administered locally.
Similarly, the previously approved transpacific antibody catchy maxim was shown to be effective in the treatment of malignant ascites. But again, had to be locally administered.
Interest in EpCAM continues to be high across the industry. But why has it taken the field so long to develop a successful systemic anti EpCAM cancer therapeutic?
The answer lies in normal tissue expression.
EpCAM expression is in fact, relatively low on most normal tissues compared to its expression on cancer cells, but it does have particularly high expression in the normal gastrointestinal tract.
This became problematic with first generation anti EpCAM antibodies that induced acute pancreatitis.
Second generation approaches such as the EpCAM CD-3, T-cell engager soliom had even more severe toxicity including grade three and higher upper GI inflammatory diarrhea and acute elevation of liver enzymes at sub therapeutic doses.
So how can we unlock the potential of EpCAM with a systemic therapy.
Well, let me list the key properties of CX-2051 that we believe make it a very attractive clinical candidate.
CX-2051 is a masked high affinity anti-antibody incorporating a [protac] cleavable linker that we have validated clinically. In other contexts, the cytotoxic payload cap-59 is a [Tobiis sos] one inhibitor well matched to cancer types where CM is highly expressed including CRC.
The C-59 payload has comparable preclinical antitumor efficacy to Daiichi's dire TAM both as a free payload and in the context of the [acam] binding ADC.
The payload antibody linker in CX 2051 has been optimized for bystander effect, which is believed to be an important contributor to ADC anticancer activity.
Furthermore, we have shown in preclinical models that CX-2051 is equivalent in activity to the unmasked ADC. But it is much better tolerated in terms of [GIOCS] CX-2051 also has shown antitumor activity in atic and resistant colorectal cancer models. A particularly important finding since we anticipate this drug will be used in the post atic anesthetic CytomX's advanced CX-2051 into the clinic in the second quarter of this year. In Metastatic CRC.
Given the very high expression and substantial medical need in CRC, we are focusing dose escalation in this cancer type to initially assess safety, explore initial science of anti-cancer activity and determine optimal dose levels for further evaluation, EpCAM expression levels in the phase 1 study are being assessed retrospectively and are anticipated to be high in the majority of patients.
And while for now, we are focused in CRC to gain initial experience with 2051 we see a broad opportunity to expand into several additional EpCAM positive tumor types. Once we have a preliminary assessment of safety and anti- tumor activity from this initial study.
I am very pleased to report excellent early progress in the phase one study of CX-2051. We are already enrolling the fifth dose escalation cohort just six months into the trial. And we have observed a favorable safety profile to CX-251 to date suggesting that masking is functioning as designed.
It is still relatively early days. But we see this as a very promising start and we remain on track to provide an initial phase 1, an update in the first half of 2025 to hopefully set the stage for broad based development of this drug.
With respect to the long-term opportunity for CX-251 we estimate that there are approximately 300,000 EpCAM positive addressable patients in the United States alone. So, this program represents a potentially transformational value creating opportunity.
Moving now to our third clinical program, CX-801 our masked interferon alpha two B PROBODY cytokine interferon alpha is a well validated molecule that we view as overlooked in the field of oncology. Interferon has established single agent anticancer activity in multiple tumor types. And it has also demonstrated potential as a combination therapy with checkpoint inhibitors.
The powerful ability of infer alpha to both directly kill tumor cells and drive antigen presentation makes it an ideal mechanism for combination with checkpoint inhibition potentially across a wide range of indications.
CX-801 incorporates a dual masking strategy with a peptide mask, blocking the interferon domains and a steric FC mask which are designed to clamp down the activity of systemic interferon and significantly increase the therapeutic window.
Our preclinical data for CX-801 demonstrates synergy with PD one inhibition both in terms of anti- tumor activity and activation of the tumor inflammatory microenvironment.
Moreover, we have also shown in animal models that systemic activity of our mass interferon is significantly reduced and overall tolerability is markedly improved compared to the unmasked side effects.
We are excited to have recently initiated the phase one clinical study for CX-801 having dosed our first patient during the third quarter.
Our initial goal for this program is to markedly improve on the clinical profile for a mass interferon and PD 1 inhibition in melanoma and CX-801 phase one dose escalation will primarily focus in this tumor type initially as monotherapy. Before moving into combination dose escalation with Keytruda, which we have access to through a collaboration supply group with Merck initial phase 18 data for CX-801 is anticipated in the second half of 2025.
So, with that, let me hand things back over to Chris to provide an update on our finances.
Chris Ogden
Thank you, Sean. Echoing Sean sediments. We are in an exciting stage with our pipeline and as we move into next year, we plan to deliver important clinical updates that have the potential to deliver significant value creation for CytomX. And we will also further inform our highest priorities for capital allocation across the pipeline.
With that context, we continue to remain disciplined in capital allocation with a focus on delivering against our clinical milestones in 2025.
Now, with that, I am pleased to be able to share our third quarter 2024 financial results with everyone today.
As of September 30, 2024, we ended the quarter with $118 million in cash, cash equivalents and investments compared to $137 million in cash. At the end of the second quarter, we expect that our cash balance will continue to fund CytomX operations to the end of 2025.
As always, our cash guidance does not assume any additional milestones from existing collaborations, or any new business development and we are active in this area.
Turning to revenue and operating expenses for the third quarter revenue was $33.4 million compared to $26.4 million in the third quarter of 2023. The higher revenue in the third quarter was driven primarily by research under our collaborations with Bristol Myers Squibb and Moderna operating expenses for the third quarter were $29.3 million.
An increase of $6.1 million compared to the third quarter of 2023. R&D expenses were $21.4 million for the third quarter of 2024 which was an increase of $4.9 million compared to the corresponding quarter in 2023.
This was primarily driven by increased clinical and manufacturing spend for CX-2051 as well as higher clinical spend for CX-904 G&A expenses increased by $1.1 million during the 3 months ended September 30, 2024, to $8 million compared to $6.8 million for the corresponding period in 2023.
Operationally, we continue to make significant progress with Amgen, Ellis, BMS Moderna and Regeneron. With the majority of our partnered research currently focused on masked T-cell engagers year-to-date. We have received $10 million in pre-clinical milestones through our collaboration with Ellis and continue to receive R&D funding across a number of our partnerships.
Additionally, we have the potential to earn additional milestones through our collaborations over the next year.
Closing out our financial updates, we continue to be disciplined in capital allocation with financial resources to support key pipeline milestones which we expect could drive meaningful value for shareholders and inform later state development for the pipeline.
With that. I will turn the call back to Sean for closing remarks.
Sean McCarthy
Thanks Chris and thank you everyone for joining us today. We are excited about the work we are doing at CytomX to advance our multimodality clinical pipeline towards value inflection in the near term. And we continue to push boundaries with our science.
The PROBODY platform and antibody masking in general is of high strategic interest in the industry. And we continue to be at the forefront of this field.
Looking ahead to 2025 we are well positioned to deliver multiple clinical data readouts across the pipeline. And we remain focused on advancing CX-904 CX-2051 and CX-801 to clinical proof of concept and to rapidly advancing programs into later phase development where we can deliver meaningful and differentiated outcomes for patients.
Furthermore, I would underscore that CytomX is and always has been built to deliver value over the near and long term. And we maintain our long-term perspective. We have deep expertise in the field of mass therapeutics across multiple modalities. Strong large pharma and biotech partnerships which position CytomX drive sustainable innovation over time to close out.
As always, I want to thank sincerely the patients who join our studies, their families, our clinical investigators, and our team for continuing to drive our mission forward. And with that operator, let us go ahead and open up the call for Q&A.
Operator
Thank you. At this time, I would like to remind everyone in order to ask a question. (Operator Instructions) And your first question comes from the line of Joseph Catanzaro with Piper Sandler. Your line is open.
Joseph Catanzaro
Great. Thanks for taking the questions. Thanks for the update. So may maybe first one on the CX-904 update and, and timing around the phase 1B decision. And it sounds like that's contingent on finishing the dose escalation and optimization.
I guess, you know, as we think about that, is, is there a like pre specified target dose that you are looking to achieve to achieve, is that a, hit the MTD, I guess, talk us through, how you are going about making the decision that you have identified the right dose, the right schedule there.
Sean McCarthy
Yeah. Hi Joe. Thanks for the question. As you know, I mean, since we presented our first results on this program earlier this year, you know, we have been very pleased with the safety profile of 904 and as we have continued our work over the course of the year, we have continued to learn about that safety profile and, and as a result, been able to continue to successfully escalate.
And, you know, we, we believe that it is important to continue to maximize dose for this, for this drug and, and keep going. You know, we know that we, I think we are all still learning in this field. I think generally that we, we do see those responses for T-cell engagers.
So we think it is in our interest and, you know, our partner's interest really continues dose escalation. And we are really pleased now to be at the next dose level up from 15, which we are, which we are actively enrolling. So, of course, the flip side of that is it means that it is going to take more time.
That is sometimes the way it goes t cell engagers in general. We are, we are all learning are tending to take more time rather than less, but we have got to make sure we do the right experiments.
Joseph Catanzaro
Great that is helpful if I could ask maybe one quick follow up on CX-2051. It is great to see the dose escalation moving along nicely wondering if you could say where dose level 5 falls within the number of planned dose levels and whether dose level 5 is, you know, within the expected therapeutic window or, or maybe there's still a ways to go there just trying to maybe start to think about the first half 25 update.
Sean McCarthy
Yeah. So again, great question. So, as I said, we are, we are, we are very pleased with the early progress with 2051. You quickly having moved into cohort five. This is obviously quite an experimental therapeutic, you know, cam being the target a mass ADC with an actually a novel payload count 59.
This is the first experience with this payload in the clinic. So, you know, we will learn as we go in terms of how the clinical data matches up to our models predicted range for safety and efficacy.
What I so what I can, what I can say is that compared to our modelling, we are at, we believe we are at doses where an unmasked ADC would be very likely to show the kinds of GI toxicities that have been seen with other unmasked cm strategies in the past. So, we, so we are pleased with where we are, but it is still relatively early days and we will, have more to say in the first half of next year.
Joseph Catanzaro
Okay, great. That is all helpful. Thanks for taking my questions.
Operator
Next question comes from the line of Liam Chang with Jeffrey. Your line is open.
Great. Thank you for taking our questions. This is Leon Cheung for Roger. So, I guess for us, we have a question about 904. So, regarding the phase 1B decision, so just wonder, you know, I believe the Pancreatic was the first ahead of the, in terms of enrolment. So where are we remind us? Where are we for the enrolment of the non-small cell line? And the head and neck.
And also, when you make the decision for phase 1B, will you also report the data, or you report it separately at a medical conference or like a company event? Thank you.
Sean McCarthy
Great. Thanks. Thanks for the questions. So, with regards to enrolment, as we mentioned, we have continued over the course of this year to obviously enroll in pancreatic where we reported our first single agent activity earlier this year. And we have continued to well increased, I guess emphasis on enrolment in head and neck and lung cancer. Since that may update in the may update, we had just a handful of patients in those two indications.
So, you know, enrolment has progressed well over the course of the year, we have been enrolling at the previously cleared doses of five and 10 mg. Now that we have 15 cleared, we will enroll at that dose and also continue to escalate to the next dose level. So that is where we are in terms of tumor types, in terms of data and decision.
This is of course, you know, a program in close collaboration with and we are we continue to be very, very focused on, on the and relationship on building a data package to share with them when the time is right to discuss next steps, which would be ideally the move from phase 1A to phase 1B and the data should be anticipated on the other side of that potential decision sometime later in 2025.
Got it, Thanks.
Sean McCarthy
You are welcome.
Operator
And your next question comes from the line of the, the route with PMO capital markets. Your line is open.
Etzer Darout
Great. Thanks for taking a question. Just another one in CX-904. As you are thinking about you know, sort of potential phase one B just across, you know, pancreatic or the other tumor types. Would these be monotherapy studies or maybe studies in combination with standard of care, particularly in like head and neck or, or non-small cell lung cancer. If and, and how you thought about that? Be great. Thank you.
Sean McCarthy
Yeah, hi. So, thanks. We are very focused on monotherapy at the moment and that is very consistent with the goals of our partner. Not to say that we are not giving consideration to combination strategies obviously on a, on an indication-by-indication basis. But right now, we remain at least in the phase one, a setting, of course, principally focused on, on monotherapy as to whether there will be any combination component of potential future phase one B. That is something that we do, we do plan to talk to our partner about, but as yet we have no defined plans for.
Thank you.
You're welcome.
Operator
Your next question comes from the line of Anupam Rama with JP Morgan. Your line is open.
Anupam Rama
Hey, guys, thanks so much for taking the question just wondering if we could, I could get one in on CX-2015. I know that you -- retrospectively if you looked at cm expression levels and they are high in the phase one study, is it fair to assume moving forward that you will be enrolling only high cam expressing patients or will you be taking all comers? Thanks so much.
Sean McCarthy
Yeah, no problem. That is a really good question. So, in CRC, as I mentioned, it is, the cancer type where EpCAM was first described long time ago and it was first identified there as a function of its really, really high expression.
And, you know, we have, done work with our own, our own assay that we have developed here at CytomX to confirm that in our hands, more than 90% of metastatic CRC patients have, have high level [cm] expression. And so, II I do not think, you know, and we will, validate that as we continue to look at the retrospective analysis in this ongoing study.
But I do not expect that on a go forward basis. In CRC, we would need to select the target. You know, for, that tumor type, if you look across other tumor types, one of the great things about EpCAM is it is expressed on so many cancers, you know, also at high level. But in some like, you know, lung cancer, it is high in, you know, 60%- 70% of patients that compares to gastric cancer, similar kinds of kinds of levels.
And in some tumor types like bladder prostate pancreatic, it is a little bit lower. And so, you know, we, we have developed, we think a very good assay, a good, a great IHC assay that will enable us in some of those other tumor types to potentially select for patients if we need to. And we will cross that bridge when we come through it, come to it.
I think another key point here though is that if you, if you aggregate across tumor types for EpCAM expression, there are hundreds of thousands of patients to be treated with a drug like this and we do see 2051 in the long run, you know, for that reason, having potential, you know, pan tumor potential a little bit like we have seen with there to.
Operator
Again, if you would like to ask a question (Operator Instructions). Your next question comes from the line of Mitchell Kapoor with HC Wainwright. Your line is open.
Amit Dayal
Good afternoon. This is Dayal on for Mitch. Thanks for taking our questions. Kind of on the idea of FCOM EpCAM expression and we were talking about the different tumor types. Are there any tumor types that you think are particularly vulnerable to the bystander effect?
Like, are there any biological rationale for that? And are there any specific tumor types with lower her two expression that might be less validated for an ADC approach but have higher EpCAM expression and somewhat higher unmet need. That might make it a cancer of interest.
Sean McCarthy
Well, I would say the main way we think about that in the context of this drug candidate is really in the design of the, of the payload and the linker itself. So those of you who have followed CytomX for, for a while may, may recall that we actually we had a prior version of a net CM, ADC which we had conjugated to a matanza payload. But we would always been really interested in, this expression in CRC and how to develop a drug that was more tailored to that tumor type just because of the unbelievably high expression of the target.
And that is what led to our selection of the cap-59 payload is a tool one inhibitor because as a, tool one inhibitor, it is indicated for the treatment of [T] and sensitive tumors like CRC. So we have been very deliberate in the design of this drug in terms of selecting payload to match level of target in areas of higher met need, including CRC, but not limited to CRC, also including lung, both squamous and adeno, ovarian, gastric as I have mentioned.
And many other tumors besides with regards to bystander effect, the linker, the trine linker that is in this ADC is also optimized for bystander effect.
And bystander effect can be particularly effective in the presence of high levels of target where ADC will bind target and in the extracellular environment release payload.
So, so you know, we just feel like the overall design of, we took our time to really get this one optimized and we feel like the overall design of 2051 the payload, the cleavable trial a linker, of course, the antibody mask and the protease cleavable linker and the selection of EpCAM as a very high potential previously clinically validated target really gives us, you know, the highest probability of technical success with this drug relative to the other ADC that we put in the clinic in the past.
Amit Dayal
Awesome. And if I could ask just for a little bit more color on the 904-program update, that was expected by year end. Has that been delayed or did the lack of ma maximum tolerated dose complicate that? And if so, when can we expect the next data release for phase 1A with 904? Thank you.
Sean McCarthy
Yeah. So, we consider today's call really this, this is the update on 904.
And you know, we are now and as we have said, this is very much a function of continued dose escalation. I wanted to make sure that we really fully explore dose intensity for 904 in the clinic.
So that, that means that the next update on this program will be next year. And what we are laser focused on is our alignment with Amgen as we continue to collect data and work with them as we move into next year on potential next steps.
Amit Dayal
Thank you so much for the answers.
Sean McCarthy
You are welcome.
Operator
Thank you. I am not showing any further questions in the queue.
I would now like to turn the call back to Dr. Sean McCarthy, Chairman and CEO for closing works.
Sean McCarthy
Well, thanks everyone for tuning in today. We are really excited about progress through 2024 at CytomX and we look forward to providing additional updates as we move into 2025. So, thank you all for your time.
Operator
Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.
