Alligator Bioscience AB (publ) (ATORX) Earnings Call Transcript & Summary

Greetings from the BioStock Studio here at Medicon Village in Lund. We're pleased to invite you to this R&D market update event featuring Alligator Bioscience, a Lund-based biotech company developing immuno-oncology treatments. The program for today's event will begin with Alligator Biosciences' CEO, who will talk more about ATOR-17 -- ATOR-15 (sic) [ ATOR-1015 ] and mitazalimab. At 02:15, we will hear from the company's COO, Malin Carlsson, who will discuss instead ATOR-17 and its development track. Then at 02:30, we will be joined via Zoom by Professor Ignacio Melero from the University of Navarra in Spain. He will talk about 4-1BB as an attractive target in immuno-oncology. At 02:45, the program will finish off with a Q&A session and conclude at 03:00. So now I'll leave the words to Per Norlén and Malin Carlsson. Welcome both.

Thank you. So again, welcome. This is an R&D update, and we are today going to focus on our clinical programs on the actual drug candidates, their properties and how we're going to develop those to bring great value to the programs. At my side is Malin Carlsson, our Chief Operating Officer and Head of R&D, and she will introduce you to 1017 in more detail, a program that we just released new data on. First, I will start introducing you to 1015, mita and also some highlights on the company. So we have a solid clinical pipeline today with 4 products at clinical stage within immuno-oncology; 3 of those are actually in the clinic, all with a first-in-class potential. And we have built them all through our internal technology platform from ID generation through preclinical development and into clinical assessment. One of these is ATOR-1015. Here, we are first in the world with a novel concept, a tumor localizing CTLA-4 bispecific, and it solves one of the key problems of immuno-oncology today, that of the CTLA-4 toxicity. We intend to take CTLA-4 from being sort of a last resort into standard of care. And that's by solving the toxicity issues. We also have 1017. Malin will get back with more data. We have today released new clinical data, and it's a potential for best-in-class and first-in-class in the next-generation 4-1BB antibodies. We also have mitazalimab. This is a Phase II ready CD40 antibody, and that's an area where there's now also clinical validation within immuno-oncology. And we intended to take that into pancreatic cancer in Phase II. And lastly, we are capitalized today to bring all our clinical programs through clinical development for more than 12 months going ahead. So when will the data come? We have already presented. We have presented on ATOR-1015, the first interim update on the clinical studies. And that was released at ASCO in June this year. We've also presented 1017. 1017, it's released today, and we will come through with more data later on. Now you can see the slide as well, which makes it easier. Then we are, later this year, going to release 1015 data, the full study data that will include efficacy data and the biomarker data, and that would be released at the scientific conference later this year. Then next year, there will be very important news. First, we have a full readout of the 1017 clinical study. That will be in the spring next year. And then for the first time in the history of Alligator, we will get efficacy study readout, and that will start with ATOR-1015 who will have a study readout in malignant melanoma. Also, we will have efficacy readout for mitazalimab in an interim readout next autumn. And in 2022, we have more data for 1015 and a full readout for mitazalimab. So let's go on to the products. 1015. This is a well-known target. It's clinically validated. That's why CTLA-4 discovery received the Nobel prize. It activates the T cells, that's well known. It also takes away the inhibitory cells in the immune system, the regulatory cells. And that part of the mechanism is probably the most important. 1015, we have actually shown quite clearly that 1015 has a superior efficacy on killing those regulatory cells compared to other CD40 antibodies. So it's a very strong efficacy. Despite that, we are now confident that also the tolerability profile is superior. And that is backed up on the emerging clinical data, the data we have released at ASCO this year. So let's take a look at the data. The study has included 21 patients. It's a dose escalation trial, and now we are at quite high dose levels. It's all comers. So a lot of different cancer indications and essentially cancer indications where no other therapy is allowed anymore. So that is a population. We are dosing at 750 milligram, which is a three to fourfold higher than the highest dose of our competitors. Still, we have seen no DLTs, which is dose-limiting toxicity and no severe adverse events. We do have immune-related adverse events, but they are tolerable. Today also we have some early efficacy signals. We have best response yet is stable disease. And the question might be, of course, when will we get proof-of-concept data for this molecule. So let's move to the clinical plans. The Phase I trial is in its very last stages, and we are now gearing up to start the next study, which will be an efficacy study. The product is developed to be given in combination with PD-1. We have, however, made a decision to change the plan somewhat. We are front-loading another study. So -- and that will be a single agent study with 1015 in malignant melanoma. So why do we do that change? There are 2 reasons. The first one is that we can show clearly that we have single-agent activity, and that is -- was all important to generate the value for the program. The other fact is that doing this will take us to efficacy data much quicker. The reason is this Phase Ib trial, single-agent assessment in malignant melanoma will be performed as part of the ongoing trial, so it will continue without a break and start including melanoma patients in this trial quite soon. And that allows us to have an efficacy readout already autumn next year. That would be a very important readout. It would basically say whether this product works or not. Then along the way, if we see a signal, we can start and we have made all the preparation for the Phase II in combination with PD-1, and that will be started as soon as we see a signal in single-agent activity. And that trial can then read out in 2022. That is 1015. Let's move over to mitazalimab. Mitazalimab is a different mechanism of action. 1015 activates T cells, mitazalimab activates dendritic cells. This is another player in the immune system, but equally important. Dendritic cells present tumor antigens. It shows the immune system what to attack, how to identify the tumors, and then the dendritic cells will activate the T cells who will kill the tumor cells. So it's an important complement to today's T cell therapies. We have completed Phase I, as you can see in this slide. And we are now gearing up for Phase II. What's important with CD40 is that we, today, have clinical validation for the target. It's come through one of our competitors, and I'll show you the data. What you see here on the left-hand side, in the white column, that is chemotherapy response for it in pancreatic cancer. And you can see it's a very poor response rate. The black column is a more recent and a better chemotherapy combination, gemcitabine plus nab-paclitaxel. And that has a better response rate in the range of 20% to 30%. There has been studies to assess where PD-1 adds to this activity. Of course, there's been high hopes in seeing effect of PD-1 in pancreatic cancer. There's been basically no effect whatsoever, and that's the red column, adding PD-1 on top of chemotherapy. So why is that? The answer is quite simple. PD-1 activates T cells, but pancreatic cancer is an extremely cold tumor. There are essentially no T cells there. So no point in activating what's not there. CD40 on the other hand, CD40 shows the immune system what to attack. It activates the T cells and makes them recognize the tumors. So that will lead to T cell infiltration. And the hypothesis is that CD40 could make the tumors sensitive for PD-1 therapy. And that is exactly what has been shown by our competitors. The green column is chemotherapy plus CD40. Suddenly, we see a better response rate. And the gray column is adding PD-1 on top, and then CD40 seems to make PD-1 work. So that's a great and very promising data, and that's why we also intend to go into pancreatic cancer. One question is how we compare to competitors. Here is a quite elaborate scheme and I won't go through all the details. I would say, we have essentially 4 key competitors. There are 6 programs in clinical development, 4 of these have products that have a stronger activity in the tumor environment, making them better tolerated and a greater potential for having a therapeutic window. And those are the one in blue gray here to the left. Of these 4 products, you can see on the first line that we have the same format, all our IgG1 and -- but our competitors have made a modification. They are very similar all the products. Our competitors have made modification, and that's based on early mouse data several years ago that suggested that, that would be beneficial. But it was shown over the years that, that was not translatable to patients. They have basically a different setup, making that change probably unimportant. That change, however, has another effect. It makes those antibodies proportionately more active in the circulation, and that could be a tolerability problem because activation in the circulation could lead to cytokine release and inflammation and that will reduce tolerability. And I think that is probably what we see in the clinical trials. Let's look at this slide. Sorry, see if I can make this work. So we have a tolerable dose of 1.2 mg per kg today, whereas our competitors, as you can see, are severalfold lower, especially the Seattle Genetics SEA-CD40 has a very, very low tolerable dose, and that's where we have a great advantage. We are at the dose levels where you should be with an antibody, our competitors are not yet. Then if we look at another aspect because if we have better tolerability, what about efficacy? Are we as efficacious. Well, let us compare to the main competitor, Apexigen. That's a product that generated the clinical validation has shown signs of efficacy in pancreatic cancer. We have a much higher dose, 3 to 4 to fivefold higher, but if you go to and look for preclinical evidence for efficacy in vitro in cell cultures, both companies have very strong data. They have very active antibodies. If you look to in vivo activity, that's antitumor effect in different models, both companies again have shown very strong data. The only 1 difference is we have shown it with our molecule, they have used a surrogate mouse molecule with similar properties to their clinical antibody. Then what about PD biomarkers? In the clinical studies, we have essentially the same profile. We show elevation of the same biomarkers and elevation to the same level. So it looks very similar. In the Phase I trials, we do move down the list, single agent activity in Phase I. We have seen a low response. We have 10 stable disease and 1 clear responder. They had none in their study. So actually, there's a clear advantage to our product. Then, of course, in clinical Phase II, we're not there yet. They have shown promising data. I'm confident our molecule is at least as active as the Apexigen product. So it looks really promising. Let's take a look at the planned trial. This is what it is. We have a dose escalation built into the trial. It's a very small escalation. We move down half a dose level and then move up again. Once we establish tolerability with chemotherapy, then we will expand the trial, add another 20 patients and make efficacy assessment, see if we have an efficacy signal. If we do, we add more patients; if we don't, that's the end of it. The trial itself, if you look on the right-hand side, in black, we have the chemotherapy. It's modified FOLFIRINOX, that's a combination of 4 chemotherapies. And then we have mitazalimab. And that dosing regimen has been adjusted to maximize the mode of action of mitazalimab. Mitazalimab, what it does, it improves antigen presentation. Chemotherapy on the other hand, that will damage tumor cells, which will lead to release of tumor antigens. So the tumor antigens will be released. A few days later, we will give mitazalimab, who will improve the uptake and the presentation of those tumor antigens and then induce a strong immune reaction. So that is to maximize the effect of mitazalimab in combination with chemotherapy. Of course, we do include CT assessments of tumor size. We are going to have biopsies and also we have a very strong biomarker plan to back it up. And the timing for the study is as follows: we have a complete Phase I. We are now entering Phase II by submitting a CTA by the end of the year, and we plan to dose the first patients in the spring and then have an interim readout with biomarker data and our first clinical response data end of next year with a full readout in 2022. So that is 1015, and that is mitazalimab. And now let's move into 1017. Malin? I leave this for you.

Thank you very much. So I'm really excited to share some data around 1017 with you today. 1017 is perhaps the least publicly known molecule in our portfolio. But I would like to change that and really share some information around this molecule with you. So ATOR-1017 is directed against the 4-1BB receptor that is localized on T cells and NK cells in the tumor. And this is a quite well-known target in immuno-oncology. Now there is lot of interest around it. And our molecule is -- has the potential to become best-in-class and also potentially first-in-class. We are currently in Phase I, and we have shared some interim data with you today. And we are moving into Phase II, once Phase I has read out next year. I'm going to share with you today what makes ATOR-1017 so unique in the landscape of 4-1BB antibodies. It's directed against the unique domain and is -- has -- is an IgG4 molecule with tumor-directed effect. So the 4-1BB molecule is the target, and we are happy to have Professor Melero with us later today, who is a world-known expert on this target, and he will share some thoughts around this target with you today. This is a target that is highly expressed on T cells and NK cells. And it's preclinically validated and there are also some signs of efficacy in clinical trials by now. There are several antibodies in clinical development, and this is a molecule that we expect to have efficacy in combination with PD-1. So patients on PD-1 treatments will have an additional effect of adding ATOR-1017. So this image of the 4-1BB molecule, there are 4 different domains, with domain 4 most proximal to the cell membrane and domain 1 more distally. And we will talk more about that during the presentation today. So 4-1BB, there are several antibodies in development, and ATOR-1017 was designed to overcome the limitations of the first generation of 4-1BB antibodies. There was urelumab from Bristol-Myers Squibb that went into clinical trials in 2005. That program is now stopped due to toxicity issues. And then we can mention utomilumab from Pfizer, that is still in development. Most studies are stopped due to lack of efficacy. So this is a weak antibody. ATOR-1017 has been designed to overcome those issues and to really hit the sweet spot between safety and efficacy. So what we have done in designing ATOR-1017 is to use the knowledge that is out there in how 4-1BB antibodies work. We knew that urelumab is directed against domain 1, and it's an IgG4 molecule, and this became a very powerful antibody. And we know that utomilumab is directed against domain 3, 4 of the target. And this was -- is an IgG2. And this then was a weak agonist. So we hypothesized that by binding to domain 2 of the target and to create a molecule that is stabilized IgG4 with effects in the tumor, we would create the -- optimize the perfect 4-1BB antibody. So what the team did, and this was before I joined Alligator and I must say I'm quite impressed by the work that has been done. They selected a number of molecules out of the ALLIGATOR-GOLD library, and they optimized them through the FIND technology to really find the absolute right molecule with the right properties. So domain 2 binding IgG4 molecule, but moreover, we wanted it to be stable and with good drugability properties. And as a drug developer, I know that those features are so important when it comes to really putting a drug on the market, that it's possible to manufacture it in an efficient way, but it's stable and that it doesn't aggregate and so on. And all those properties we see in ATOR-1017, which is very nice. Right. So this is new data. The yellow here in the molecule that is a crystal structure of the antigen binding portion of ATOR-1017. And this is so nice for us to see because we have selected an optimized molecule to have the exact correct properties. But now we also have some visual evidence that this is indeed the molecule we have. So it's nice to be able to present that to you today our crystal structure, ATOR-1017. Taking a look at our competitors. We have urelumab, the super agonist and their crystal structure as well as utomilumab's crystal structure have been published. So we have put the image up here. We see that it binds to domain 1. Utomilumab binds to domain 3, 4. And here, we have them again, ATOR-1017. There is another one in clinical development Phase I from Compass. This 1 binds to domain 3, 4, yet to be proven, the effect there. For ATOR-1017, we anticipate that this molecule will generate the safety profile we need and also yield the right efficacy. So moving into the clinical data that we have shared with you today. We are in Phase I, running a study that is our first in-human study, multicenter open-label study. This is a quite traditional Phase I study in oncology, running in 3 sites in Sweden. We may include up to 50 patients with metastatic cancer. The patient population is also quite classic. We are looking at solid malignancies, all comers with advanced or refractory or metastatic or unresectable disease. And as is common, those are patients that -- where the remaining therapeutic options basically is participation in a clinical study with a modified 3 plus 3 dose escalation design. So we are happy to share with you today that the 40 milligram flat dose has now been clear and we are ready to dose the next dose level of 100 milligrams. We have 7 patients that are still on the study, all of them. And what is important is that at this point in time, at 40 milligram, we have seen very few drug-related adverse events, and those that we saw were mild or moderate. This is also a piece of clinical data that I'm happy to share with you today, the pharmacokinetics, the PK profile. And what we see here is exactly what we expected and wanted to see. We see a dose proportionality with the highest doses yielding the higher concentrations. And we also see a long half life just as we wanted to confirming that all the engineeral efforts in picking the absolute right molecule actually paid out. And this is really exciting data for me as a drug developer. So we are running Phase I, and that will read out in its -- in total in next year -- in the first half of next year, and then we will move into Phase II, and we are preparing for that, and I look forward to share more data from the Phase I study with you in due time. And by that, I hand back to you.

Thank you. Thank you so much for the presentation, very interesting, and you too, Per. And now, actually, we will try to get in touch with our next guest, virtual guest, if you may, Professor Ignacio Melero, guest lecturer, who is going to join us by Zoom from Spain. But I'm receiving input that he's not able to make the connection. So we may have to wait a few minutes.

So -- but in the meantime, maybe I can go ahead and ask you some questions actually. Since you just gave the presentation on 1017 here. I have some specific questions regarding that. As you mentioned, you broke the news this morning the positive news of the Phase I trial showing a good safety profile with the lowest dose, 40 milligrams. And we were just wondering how high in dosage do you expect to go as the study progresses.

That is difficult to say. So we will progress. So we are -- right now 40 milligram is around twice the dose where urelumab, their maximum tolerated dose. And that's a very good sign, of course, that we are this high already. How high will we go? We will keep dose escalating as long as it makes sense as long as we have reason to believe that additional dose will actually add benefit for the patient. And we will keep assessing that as we go. But time-wise, somewhere next year, I think we will come to a point where we can select our next Phase II dose.

Sounds good. And -- well, actually, you've gone through this, but would you like to add any specifics regarding the time line of the 1017 study? Yes, the next steps actually you showed on this slide.

Yes. So we presented our interim safety data and PK data today. And this really depends on how high can we go. Because we do 1 dose at a time, is that safe, we move on, that's how it works. So this one can move in any direction. But I'm quite certain it will be during next year and during the first half of next year.

Okay. And actually, one more question regarding 1017. And how does the competitive landscape look for 1017?

Right. Yes, I mentioned the Compass molecule. And then there is -- so there are 3 us and 2 more in Phase I, Adagene also has a molecule in Phase I. They are quite similar to ATOR-1017, not quite. So that is the competitive landscape right now. Then there are a number of assets in preclinical development. So there is a huge interest in this target. And -- but it's about finding this sweet spot between safety and efficacy that will select the winner in this race.

Great. Still no sign from the Professor. Well, in that case, I can continue with some questions. Maybe Per, if you'd like to join us.

Yes, absolutely. Thank you.

And so I had one question regarding mitazalimab. And that is what specific characteristics would you say make mitazalimab suitable for treating pancreatic cancer?

I think, first of all, the mechanism of action. It's today, what we can understand, the only mechanism that could add to chemotherapy. It has a response rate, but basically long-term survival, there's still nothing that affects long-term survival. With mitazalimab and our competitors, I should say, they increase the responsiveness of the tumor for immunotherapy. If you can say some people say it makes a cold tumor hot, that basically means that the tumor without T cells will turn into tumor with infiltrating T cells that could attack the tumor. And that is the basic CD40 mechanism of action. And then as I alluded to before, our molecule has been designed to have a strong activity within the tumor with less activity in the circulation. And we strongly believe that is something that will make CD40 a tolerable target while also an effective target. So that will give us a therapeutic window.

Great. In regards to ATOR-1015, in general, how do you believe it will change the immunotherapy landscape?

So ATOR-1015, what we tried to do here is to get around CTLA-4 toxicity. CTLA-4 is behind or beside PD-1, the only immunotherapy target that has been clearly shown that it adds long-term survival to patients. The problem is it isn't used because it's so toxic, it over activates the immune system. It does an general immune activation and immune system starts to attack you name it, every tissue in the body. So most patients get really sick and have to terminate therapies. Our thinking is basically that if we can localize the antibody for the tumor to have a selective activity within the tumor area and sort of the draining lymph nodes with less activity in the rest of the body, we could reduce that systemic toxicity. We don't think we would get away from toxicity, but we think we can get a better profile and essentially making it possible to use the product in less ill patients. Today, it's what you use when you don't really have a choice to use anything else because it's so toxic. But we think it can be expanded to much more patients and in more indications, it will make a better tolerability.

Very promising then.

Yes.

This is -- we -- I've been told we have the Professor online. Professor?

Yes. I am.

Okay. There he is. Well, thank you, professor for joining us. I just wanted to give a short introduction for the professor here, Ignacio Melero, who is joining from Zoom -- from Spain by Zoom. He is an internationally acclaimed leading expert on the 4-1BB as a targeted immuno-oncology and being both a medical doctor and a highly active translational scientist, he and his team have made significant contributions in the field of immuno-oncology. And I thank you again, professor, for joining us.

It's my pleasure.

I'll leave the floor to you too to give the presentation. I'm sorry, say that again.

Do you want me to start the presentation now?

Yes, please. Go right ahead.

Okay, I'll do that. So I'm going to share my screen, should be working, so let's see. Okay. Are you seeing my screen already?

Yes. Looks good.

So when I joined the teleconference, you were talking about checkpoint inhibitors and some of the blessings and the curses that are behind those therapies. But it has been certainly the best way to achieve efficacy over the years using immunotherapy. And in a way, what we are tampering with are the mechanisms that prevent excessive immune responses, inflammation and rejection of -- [ apoptosis expressing transplantation autoantigens. ] In a way, the mechanism is simple because you have to block these inhibitory receptor ligand first as hard as you can, trying to stay away from dose-limiting toxicity typically in the form of autoimmunity or auto -- or self-limited autoimmunity. There is another way of thinking, and actually, both of them started about the same time, and that's that using agonist moieties for activity receptors of the immune system under certain circumstances, it was conceivable that you can provide them in such a way that you would enhance the intensity of ongoing immune responses. That the best receptors to achieve so were what we called and -- keep calling costimulatory receptors and those were receptors that are kind of confirmatory for T cell activation. If T cell is being engaged by cognate antigen, then what happens next is that, to some extent, is asking for contest signals telling that it's appropriate to get activated, expand and acquire effector functions. And one of the things is that some of these costimulatory mechanisms -- some of these costimulatory receptors have constitutive expression while others get expressed only on those T cells that are experiencing or are involved in an ongoing immune response. So precisely to those, it would be providing considerably a stimulatory signal. So one of the points is that at least some of the molecules in the TNF receptor family of surface receptor, fulfill this concept of the T cells that are the [indiscernible] and therefore, receiving a potent signal through the antigen receptor would be becoming poised to respond to these costimulatory stimuli. So in a way, immunostimulatory monoclonal antibody is coming to flavors, one of them are these inhibitors of -- inhibitors and the other one would be agonists or activators. And many of such molecules are under clinical development. As you know, with PD-1, PD-L1 and CTLA-4, these area of releasing the brake type of strategies have made to the clinic with much success in the area of agonist antibodies, probably the most advanced are right now anti-CD137 or 4-1BB, that's what we will be commenting in detail about OX40, but also GITR, CD27, CD40 acting on antigen presenting cells and ICOS are in this list of molecules targeted with that purpose. So specifically, we think the TNF receptor family, these are molecules that are expressed on T cells, very weakly in a constitutive fashion with the exception of CD27, which is constitutively expressed and expression gets augmented, much augmented during anti-independent T cell receptor activity and also CD28 costimulation enhances the level of expression of CD -- of 4-1BB, OX40 and GITR. They belong to the tumor necrosis factor receptor family, but they do not have a death domain that's cytoplasmic sequence that is able to exert [indiscernible] based activation activity. So they do not trigger apoptosis. But on the contrary, they are able to engage with several adapters that convey stimulatory signals to the anti -- the receptor expressing cells, mainly mediated through the NF-kappa B pathway activation. They lack an intrinsic enzymatic activity, but they are able to recruit constitutively and upon activation these family of TRAF receptors that can mediate the signal. In the case of 4-1BB CD137, the canonical adapters that have been extensively described are TRAF2 and TRAF1. TRAF2, we believe we have an idea of what it does and it's E3 ubiquitin ligase that creates docking sites for downstream signs. TRAF1 is almost a total mystery. And CD137 was discovered by [Indiscernible] almost 30 years ago as a receptor that was expressed on activated T cells, but not on resting T cells. And a group in Seattle, in Medarex, which was very actively working in the TNF receptor, TNF family, discovered a ligand, 4-1BB ligand or CD137 ligand, which is mainly expressed on professional antigen presenting cells such as dendritic cells, activated macrophages and activated B cells. From very early on, both with natural ligand and with antibodies, it became very clear that ligation of CD137 was able to promote T cell proliferation, part of the story is that it enhances the production of interleukin-2, then it's a very powerful inhibitor of T-cell apoptosis through several mechanisms, and it also enhances the ability to perform cytotoxicity and to produce cytokines. Very early on, there were agonist antibodies that can mimic the ligand and even surpass greatly the effects in a pharmacological fashion. And they were studied and most of their activity seems to be related to the ability to cross-link the receptor in a patch -- in a micropatch of a plasma membrane. And as we will be commenting, the strategy has progressed to Phase II clinical trials. So the experiments that we started almost 25 years ago were very simple. And that was where that we were implanting tumors with the reputation of being not very immunogenic in syngeneic mice. And what happened is that by providing systemic administration of the agonist anti-4-1BB antibodies, we were able to reject complete rejections in a good number of cases even when the tumors had been allowed to grow for over 10 days. And that was quite remarkable. The mechanism of action from the beginning was very clearly involving activation of cytotoxic T lymphocytes that was mediating cognate recognition of antigen and direct cytotoxicity of tumor cells. Over the years, it became clear also that 4-1BB activated is expressed on activated NK cells and they could be having a role in that location, that it's model dependent. Dendritic cells can also express 4-1BB and its clear that 4-1BB can be activatory in this regard. And as we will be commenting later, dendritic cells, presenting antigen to CD8 cells are required for antitumor effects. Then we spotted a curious mechanism, and that's there is ectopic expression of CD137 on vascular cells in the tumor, very much restricted to the microvasculature of the tumor and activation of 4-1BB at this level led to the production of chemokines attracting T cells and do the expression of adhesion molecules in -- on the surface of the endothelial cells in the tumor and enhancing penetration of T cells. And then from the beginning, it was kind of [Technical Difficulty] that the very same antibodies that we were using to treat cancer models were being used by some of our colleagues. We gave the antibodies to them to treat successfully mouse models of autoimmunity in which CD4 cells were the main pathogenic mechanism. And it's curious, but for example, collagen-induced arthritis or allergic encephalomyelitis or some of the models of lupus -- systemic erythematous lupus in the mice were ameliorated by treatment with anti-4-1BB antibodies. And it could be traced that the part of the story was that it was inducing CD4 apoptosis through activation induced cell death or exacerbated activation induced cell death. But it's far from being completely understood, and there are some groups that have claimed a role for regulatory T cells in those settings. And certainly, 4-1BB is expressed by regulatory T cells, including those in the tumor microenvironment, although it seems to be pretty inert because most of the research that we put forward trying to understand what CD137 does on tumor infiltrating Tregs is kind of conflicting and probably very weak effects that we don't understand yet. There were a few exceptions to this amelioration of autoimmunity and these are that you can exacerbate CD8-mediated pathology. For example, in a model of type 1 diabetes, which is a nonobese diabetic mice -- mouse and also you can exacerbate to some extent projection of allografts. And it's a curious biology that we have been studying over the years. And there was another exception is that when we were dosing agonist antibodies with -- to mice bearing tumors we were able to see mild increases of circulating transaminases and some infiltrates of CD8 T cells mainly that were starting from the periportal spaces and leading to some level, very mild level of hepatocyte apoptosis it can be seen here from a TUNEL assay. And this was on target and this was a polyclonal infiltrate according to T cell receptor sequencing, mainly mediated by CD8 cells. So there have been 2 first attempts to translate this immunobiology to the clinic. So the first one is an antibody under the name of urelumab that was developed by Bristol-Myers Squibb. This is an IgG4 antibody with a mutation to prevent heavy chain swap. It was clearing all the steps. At that time, it was not very well known, but the affinity for [ this homologous ] 4-1BB was at least a 50-fold lower than to the human version. It had certain ability to bind Fc receptors. And the thing is that it was started in the classical dose escalation trial and from these trials, maximum tolerated dose was declared, that unfortunately, at that dose, about 20% of those patients developed severe or serious hepatitis, and that was a problem. This antibody [indiscernible] is probably a superagonist antibody. It has very strong intrinsic activity on the molecule and that's monitored by reported cell lines in which you can measure the activation of NF-kappa B. On the other side of the spectrum, Pfizer developed an IgG2 antibody, utomilumab, which has very weak agonist activity, very much dependent on cross-linking, but it's a pretty weak agonist on the receptor. It went all the way through dose escalation and was very safe, the maximal [indiscernible] dose was reached. Clinical activity was very modest. It's only [ as monotherapy were observed ] in a few patients who had metastatic merkel cell carcinoma of the skin. So what happened in the clinical trials of urelumab in humans is that as a result of this mechanism -- of liver inflammation, patients treated beyond 1 milligram per kilogram were suffering quite often with liver inflammation and also a number of patients were developing a quite benign neutropenia that at least in the mouse models can also be observed and is very much mediated by local production of cytokines, including TNF alpha. So what was decided in the Bristol-Myers development was to limit the dose to those doses that were declared to be liver safe, that were in the neighborhood of 0.1 or 0.3 milligrams per kilogram and a flat dose was chosen. From the very beginning, we knew that there was a synergy between CD137 and PD-1 blockade. And part of this story, I don't claim that this all of it is that CD137 costimulation leads to a strong induction of interferon gamma, which is the main inducer of PD-L1 expression on tumor cells and leukocytes and epithelial cells. And therefore, by blocking the brake, at the same time you are acting on the accelerator you prevent this negative feedback loop from appearing. So simultaneous ligation made sense. The animal models were saying that this synergistic. And with urelumab at these doses that have been declared to be safe, very low doses, I must say. It was tested in melanoma, the combination of urelumab/nivolumab in a single-arm clinical trial, which is offering some kind of interesting results in the sense that melanomas declared to be very weak expressers of PD-L1, under 1% of cells expressing PD-L1, happened to be responsive to the combination of urelumab and nivolumab. This was presented in a meeting in SITC a couple of years ago, but has not been published yet. With utomilumab and pembrolizumab, there is also ongoing clinical research. Utomilumab is used at a high dose, 10 milligrams per kilogram together with pembrolizumab, very -- the combination is safe, again, but it's difficult to know if it's adding anything to the efficacy that you would be expecting by pembrolizumab monotherapy. There are several aspects that are calling our attention regarding the biology of 4-1BB. And one very prominent effect that was codiscovered by Greg Delgoffe in Pittsburgh and Ignacio in Pamplona is that it has a very profound effect on T cell mitochondria, enabling very much the metabolic fitness of the T cells. And in that regard, we believe that there is an almost perfect marriage of 4-1BB costimulation and adoptive T cell therapy. For a number of reasons, when you are trying to raise cultures that are to be used in adoptive T cell therapy, if you select the T cells that are expressing 4-1BB provide the costimulation in vitro, you get much better T cells in part because of these metabolic adaptations and the chromatin reprogramming effects. As you may know, the best chimeric antigen receptors used to build CAR T-cells that are around happen to have together with the CD3-zeta chain, the intracellular, the cytoplasmic tail of 4-1BB as a transfuser, and the activity there has a lot to do with persistence because of this and the apoptotic effects that I presented to you and also because of these metabolic adaptations. And also, there is the story that the endothelium by ligation of 4-1BB agonist becomes more prone to T cell infiltration. And actually, that can be spotted in intravital microscopy. This is very robust phenotype of mitochondrial hypertrophy or hyperplasia that is seen in -- under 4-1BB costimulation. And these are just examples of how strongly you can spot synergy where each treatment given separately has given very little antitumor effects and together they do get very nice synergy with adoptive T cell therapy. And these are part of the intravital microscopy experiments upon combination of adoptive T cell therapy with T cell recognizing tumor antigen and anti-4-1BB. In that setting, we realized that it's not only a matter of entering more tumor, but you also change the mind of the killers because they typically stay more on target and actually perform better to the point of achieving the induction of apoptosis of these tumor cells that can be traced under the multiphoton confocal microscopy intravital imaging. I mentioned to you that 4-1BB to work needs the system to be turned on, so you need the engine rolling before you act on the gas pedal. And part of that happens because tumor antigens are transferred to professional antigen presenting cells that are actually the cells presenting and priming CD8 T cells, which becomes expressers of comorbidity and then the antibodies can act on that. Over the years, we have realized that there is only a subset of T cells that -- of dendritic cells that can mediate such a cross presentation of tumor antigens, and those are the so-called classical dendritic cell type 1s, the cDC1s. And these cells are equipped with this machinery to present antigen to CD8 T cells. They are also very good inducers of NK cells through interleukin-12, and actually, they get attracted to each other because they have an exclusive chemokine receptor pair that bring these cells together. There is something interesting, and that's that there is a transcription factor that it's absolutely required for the ontogeny of these cells in the bone marrow. So in the absence of these transcription factors, the mice are devoid of cDC1s and cannot perform presentation. And it was very, very curious because when you were performing a therapy of engrafted syngeneic tumors in mice devoid of these cDC1s, that the tumor effect of 4-1BB and monotherapy is completely lost, also the one of anti-PD-1 antibodies and even the synergy of anti-CD137 and anti-PD-1 blockade, that in this case, in [indiscernible] tumor model, it was completely abolished as well. So things are progressing over these, and I'm sure you will be discussing the area. There are a number of -- the area is becoming extremely hot. There are a number of strategies that are being pushed in order to make the most on the agonist activity of 4-1BB and try to limit it to the tumor and the tumor draining lymph nodes in order to avoid liver toxicity and other side effects. So part of it is engineering the molecule to create bispecific antibodies. And for example, there are a number of them that could target 4-1BB and PD-L1 and they are far advanced in Phase I clinical experimentation. We will be hearing the first results around SITC of those collection and expansions. Then there is a very interesting molecule being developed by Roche, which is a bispecific that binds to fibroblast activated protein, which is a protein expressed by tumor-associated fibroblasts and fibroblasts involved in tissue repair, but not in a resting status, and very clearly permitting coming of the Compass molecule, which in this case is 4-1BB ligand hooked to an FAP. And then there are other strategies such as activable forms of anti-4-1BB antibodies that get amassed and functional in the tumor tissue and that's the case, for example, of the probodies that can activated by metalloproteinases. In the -- very recently, actually, I think that yesterday, it appeared in cancer discovery a paper for which I was one of their reviewers, and that paper is a form of an 4-1BB antibody made by Chugai, one of the partner companies or Roche in Japan, and this is an anti-4-1BB antibody that can only bind to its targeted receptor and their concentrations and their high interstitial concentrations of ATP as those happen in tumors very often. So it's another strategy. But there are a number of bispecifics trying to limit the effects. And also other strategies, I'm sure you will be discussing about them, which are based on engineered versions of the molecules that get cross-linking only in the tumor microenvironment as making them less dependent on Fc receptors or engineering these molecules in different ways. So I think that there is a future for 4-1BB antibodies. Clearly, the targeting costimulation is one of the ways to go. It's very interesting to realize that the synergy with adopted T cell therapy is remarkable. We recently publishing in cancer cell that this can be exploited to treat solid tumors with engineered T cells. We are performing a clinical trial with intratumoral delivery of an anti-4-1BB antibody in order to maximize biodistribution in one of the tumor models. There are potential in the synergistic combinations with -- not only with checkpoint inhibitors, but also with chemotherapy and other strategies, very profusely described in the literature over the last 2 decades. There are possibilities in neoantigen vaccines because as I mentioned before, when you immunize properly against the tumor antigen, those T cells that get involved in the response are going to express 4-1BB and can receive, indeed, the costimulatory signal making the most of them. And then certainly, there are many biotechnology tricks that can be used in order to create bispecifics, probodies and other [ studies. ] So I think that there is room for happy thoughts around 4-1BB and certainly, many of them already back in the clinic are approaching it with a clear hope of moving forward, the frontier, the level of efficacy that we achieved in metastatic cancer patients. So thank you very much.

Professor Melero, a very, very insightful presentation. Of course, we have a couple of questions for you, and -- before I turn back to Per and Malin. And as you've mentioned in your description, Professor, 4-1BB has become a very attractive immuno-oncology target. And there are several monospecific and bispecific antibodies as well as CAR T cells that have 4-1BB as a target under development. However, we've seen the first generation of 4-1BB agonist fail in clinical development. And I was wondering if we could get your opinion on what you would consider a successful 4-1BB agonist drug candidate.

Yes. So we have to raise the bar of efficacy very clearly. So the goals that we have with these novel molecules, and I think that they are being met is to further increase efficacy over -- with the combination with checkpoint inhibitors and other strategies, including T-cell engagers. But the point is that for the combination, we need to raise the bar at least another 20% and that's where probably we are heading to. In the case of refractory disease, by instigating the combination in an [ add-on ] setting which is another way to perform clinical development that I'm sure you are considering as well. It's a matter of at least rescuing somewhere between 15%, roughly, of patients who have been [ determined progressors ] to either primary or secondary progressors to checkpoint blockade. Those are probably the goals that we have to meet. And certainly, the tricks are going to be in the biology. We need to know which are the optimal doses, whether we need a track to get intermittent exposure of the receptor, then the intrinsic activity and the receptor becomes very important as well as the Fc receptor ability to cross link, et cetera. So those are critical issues in each of the molecules and certainly there will be some performing better than others. So -- but it's in a way difficult to predict who is going to be the best. But certainly, the goals for realistic clinical development are the ones I was mentioning to you. I don't know if I understood correctly your question, but probably I answered to it. Didn't I?

Yes, I definitely think so. I had one more question actually for you. You mentioned cross-linking ability. And we are wondering how is cross-linking dependency important for the safety of a 4-1BB antibody.

It's clearly critical. We don't understand yet the whole concept of how -- so we are more or less discarding the concept that there are confirmational changes in the molecule [ although you ] could be surprised. And then the optimal complex, it's probably trimers and complexes of trimers. So we have bivalent antibody, which should not be eliciting enough cross-linking ability. So you need further agents to cross-link, although they are preform dimers on the surface of T cells and part of them hold together by [Indiscernible]. So the point is that we are not very sure exactly how it works. But clearly cross-linking is extremely important. There are some antibodies that can be a little bit superagonist. And those could have a risk. So you want to have a system with enough safety in the liver, that's going to be also variable. Then by your distribution, one of the things that becomes -- if you perform experiments where you do PET tracing of antibodies, very often you see the liver glow. And that's because of a number of Fc receptors present in that level, the liver is one of the areas where you get accumulation of antibodies whatever system you use. And that's very variable. Some of the antibodies like very much to reside in the liver, some of them do not as much. And that's a property that in a way can be also supported in preclinical models. But the point is that liver safety is important. And one of the ways to be sure of it is to have an agonist that has more or less the same affinity for the human and these homologous molecules. The problem with urelumab is that the monkey data could not be trusted because of this difference in affinity. But if you have a truly cross-reactive molecule, then the extrapolation of liver safety, it's probably going to be quite accurate. So -- and it clearly depends on cross-linking, local cross-linking in the liver as it has been shown.

I will now turn to both Per and Malin for the next questions, but thank you again for participating, Professor, and we wish you all the best for your continued research. And I don't hear the professor, but I guess we'll go back to you, Per and Malin for a few more questions. Actually, we've received several from the BioStock audience while we were listening to professor. So we have a bit to go. But yes, so we've talked about ATOR-17, we've talked about ATOR-15 and mitazalimab. And now I just wanted to go through some general questions for both of you. This is about immunotherapy, which has been a hot topic within oncology, obviously. And what progress would you say has been made? And how does Alligator position itself within this sector?

Yes. I can start. I think the progress so far has been, it was very strong in the, say, 2013, '14, '15 with all the PD-1 data coming out. And then that data and that effect that has been taken into more and more cancer indications. So today, we have effect of this checkpoint blockade antibodies in about 20 different tumor types. So that's been a great success in establishing those therapies. One problem that's still not solved is to have this effect with other targets. We know there are many more targets activating the immune cells, but still we have not been able to find how to use them in combination or by themselves. And that's what we are working on at Alligator. That is products that could either add effect in where PD-1 is or CTLA-4 is not effective or to be given in combination with PD-1. And I think we are one of several companies working towards that goal.

Great. No, I can only agree. So the evolution has been remarkable, and it's still happening. So more and more targets are being tested. And I think there is room for them. I mean there is still an unmet medical need out there, and there is a need for finding the right drug for the right patient. So to add to the PD-1 and CTLA-4 arsenal will be a welcome addition for cancer patients and also to be able to combine different therapies. So -- and we are making our addition to that, and it's about finding the right molecule with those right properties.

This is about your financing situation in the Q2 report -- in Q2, sorry, reduced costs from Q3 and onwards will keep the company financed until Q4 2021. How far do you think your clinical programs will have advanced by then, especially with regard to ATOR-15, 17 and mitazalimab?

Yes. As we just presented, we will report the full study for mitazalimab -- no, sorry, for 1015 later this year. And then we have 1017 mid next year. And then we have a full efficacy study of 1015 by the end of next year. But obviously, we need to refinance or have filled either through deals or refinancing before that. So the other readouts that will come in 2022 and that is beyond the current financing.

Great. So here we begin some of the audience questions. And this is the first one. By the end of 2021, you can have as many as 3 candidates in clinical Phase II. Does that mean that we will not be seeing a partnering deal until the end of 2022 at the earliest?

No, not at all. We are quite heavily involved in partnering. And I think this virtual environment makes people more accessible. So we have a lot of discussions ongoing. Generally, during a dose escalation, people tend to wait for the actual safety data, signing a deal just before you get -- toxicity is not what they want to do. So they generally wait during dose escalation, but until you start a study or when you approach the later part of the study, that's ideal point of partnering. So we have 3 clinical projects and we have 1 project in addition, which is about to enter the clinic. So there's a lot of discussions.

Yes, a lot going on. And how does the plan look for mitazalimab in Phase II? Specifically, do you have enough cash to do it by yourselves?

We have enough cash to bring all the clinical programs for the next 12 months or more. But starting a Phase II trial will take longer. So we -- in order to initiate that trial, we need either a partner or a refinancing in some way, a dealer partner or refinancing. Yes.

Have you had more information from Janssen why -- as to why they returned mitazalimab to you?

Well, we have -- it's the same information. We know the Phase I trial. It was -- there was a sign of efficacy. There were 10 patients with stable disease that was 1 responder. But all in all, not a strong efficacy signal. And given that they had taken strategic decision to develop immunotherapies only in combination with their oncology pipeline, I think the signal was not strong enough for them to sort of reassess their strategy.

Right. And I have a few more questions that just came in. This is specific to ATOR-15. What is your impression of the competition for patients in melanoma. And how many patients would you expect to enroll on average per month or quarter?

I think that's an R&D question. What do you say?

I don't enroll them per month, and I can't say that.

Or quarter. Yes.

Yes. No. We have calculated the enrollment time lines, and it will run for a number of months before we can read out. So -- and we are running it in 3 different countries. So that gives an idea of how we are running the study.

And this is ATOR-17. Specifically Compass' therapeutics antibody, CTX-471 is binding to domain 3, 4, similar to Pfizer's utomilumab. And while ATOR-17 is binding to a different epitope than the other drugs, but is ligand blocking like Pfizer's drug. Do you see an edge here for ATOR-17 in terms of both efficacy and safety?

Yes, we do. Malin, do you want to elaborate?

This is our hypothesis that by binding to the right domain of the target and also by engineering the molecule to the right properties, we will hit that sweet spot. So we -- our molecule is blocking the natural ligand, whereas the others are not. And our hypothesis is that this will give the right activation and that this particular molecule will create the right activation of immune system within the tumor. And Professor Melero alluded to that as well.

Absolutely. To expand on the domains and their relevancy for efficacy, do you see parallels in the weaker preclinical response or less clean dose response by Compass' 3, 4 domain targeting antibody compared to ATOR-17 and a rather weak clinical response of Pfizer's domain 3, 4 targeting drug.

Yes. I mean, we can only guess there -- if you compare with Compass, we have used various different models, ours in our mind, is a more difficult to treat model. We've still generated a very nice dose response relationship. And 1 possibility is that the ligand blocking nature makes it more predictable, the fact that you get effect by the antibody, but not by the natural ligand. If you have like Compass, they have non-ligand blocking [indiscernible] antibody and the ligand can induce an effect. And in addition, in some -- under some circumstances, that seem to be synergistic. So that could be -- give more variable results. And we think that is a potential risk for toxicity. Still their clinical data suggests they actually can dose to quite high levels. So it seems okay.

Fair enough. And you mentioned the safety data in Q1 2021. But would you not expect also efficacy at that time point? And considering the dose escalation, you're conducting to levels significantly higher than the competition.

Yes. Malin, if you may.

So this is a dose escalation study designed to explore safety to establish the safe dose. And the population is diverse. So we have many different tumor types and patients that have been on many different therapies before. And a diverse population is always more difficult to actually tell, do we see something or is it just singular events that happened, or is it really happening something in the group that's what you're always looking for. So we may see something. If we don't, I'm not going to worry about it because this is -- the study is not designed for it. But we might. So let us come back to you.

Yes, absolutely.

Yes. And obviously, we have the biomarker assessment as well. So there is a biomarker program to add on the proof of mechanism, and that we expect to see results from as well. So we have good hopes, but you can't really tell from the safety study, that's not what it is designed for.

No, but that's a good point. We will -- so there is clinical efficacy, patient getting better, that's one, but there is also the biological activity through biomarkers, and that will be interesting when we get those.

Absolutely. And one more question. What kind of data can we expect in H2 of this year, does -- for -- regarding 1015?

Yes. 1015, it's addition to what we've shown before. So we've already shown 21 patients, and we showed the last patients as well at the high doses we are evaluating today. So we will show clinical response rates. What is there, we'll show the biomarker data and the safety data, so basically a full study presentation.

And actually, we just received one more. And could you please elaborate on the main differences between ALG, APV 527 and ATOR-1017?

Oh, yes. Sure.

Yes. Go ahead.

So these are, of course, targeting the same receptors, 4-1BB and [indiscernible] 527, that's a version where you make the activation dependent on binding to the tumor. So it's essentially active while it's circulating and activity is confined to the tumor area. And the discussion, as you heard the Professor, Melero Malaria, say, this is one way to make sure you can reduce the liver toxicity. On the other hand, you can only use the product in patients with tumors expressing that tumor antigen. So it limits the population, but it also improves the safety. If you go for 1017, we try to limit the risk for systemic toxicity by having cross-link independence. It should be more active in the tumors versus the circulation, but it's not completely silent in the circulation. So there is a slightly higher risk of liver toxicity. But again, you can use it in a much larger population. So same target, but very different profiles and different patient target populations.

Thanks. So there's obviously a lot of curiosity around your work, justifiably so. Well, thank you so much. That concludes the event for today. And thank you also for joining virtually, let's say. And don't forget to find the recording to this session on Alligator Biosciences' website later on. Goodbye.