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

[Foreign Language] Right. Thank you so much. So Alligator, we are a public immune oncology biotech company. We are differentiated through the development of tumor-directed immunotherapies. That means that we develop therapeutic antibodies that activate immune system strongly in the tumor, but not elsewhere in the body. And we do have a great innovation track record. Using our technology platform, we have brought 5 products from ID to the clinic. So let's have a look at that. Next slide. And next slide again. So Slide 3. Today, our focus is on our 2 lead clinical candidates. The CD40 antibody mitazalimab and the 4-1BB antibody 1017. Both those products have a first-in-class and best-in-class potential. And that is now supported both by our preclinical and clinical benchmarking. Also for both products, they are moving into a very important phase, entering clinical Phase II in 2021. On top of that, we are continuing our innovation, and we have just launched a novel concept for cancer immunotherapy, the Neo-X-Prime concept. This is biostatic concept for personalized neoantigen cancer therapy. And I'll come back to that at the end of the presentation. So let's start with our business model. Next slide. As for a biotech company, we develop for future out-licensing. And if we look at immuno-oncology, we have outstanding efficacy, but only in a subset of patients. Today, the race is on internationally to identify novel paths to expand that effect, to bring the effect to more patients. And CD40 and 4-1BB are 2 of the key pathways being explored. Here, Alligator has leading products within both pathways, both of them having blockbuster potential. When it comes to out-licensing, it's based on milestone revenues and royalty revenues. For both our products, we have royalty revenue streams with potential of SEK 1 billion a year. And we do have a good track record of delivering on our business model. Over the last 5 years, we have brought in plus SEK 400 million through out-licensing milestones. So let's take a look at those assets and start with 1070. Next slide. 1017 is a 4-1BB agonist antibody. 4-1BB activates T cells, the T cell receptor leading to activation, expansion and increased survival. So how does this differ from PD-1? Well, if you take a car as an analogy, 4-1BB is the gas, while PD-1 releases the brakes. And generally, to get a car moving, you need to do both, foot on the gas and release the brakes at the same time. There's a lot of evidence for synergy between the 2 targets. And that's now also emerging clinical validation. During the autumn, there have been several reports of 4-1BB bringing effect to cancer patients. 1017. We are today evaluating therapeutic dose levels, what we think are therapeutic dose levels in a Phase I doses escalation trial, and we will get a full readout in the spring. Once we have the recommended Phase II dose, we will start a Phase II trial, and that will occur in the second half next year. ATOR-1017 is in the lead in the second-generation 4-1BB antibodies. So what is that? And why is it important? Next slide. On the left-hand side here, we have the BMS product, urelumab. It's a very strong antibody, but also toxic due to a general activation of the immune system. And that's illustrated by the maximum tolerated dose being very low, 8 milligram. On the right-hand side, we have the Pfizer product, utomilumab. Pfizer reacted on the results shown by BMS, and they overcompensated. So they have generated a quite weak antibody. And also, it's only activated under very certain conditions. That's reflected in a very high-tolerated dose, more than 100x higher and also still weak activity. ATOR-1017, here, we have brought in the best from both parts. We have a strong activating antibody but also tumor-selective activation. And this allows us to bring in great efficacy, but also to have a good safety profile. And this is supported by our preclinical benchmark data and by data on the ongoing Phase I clinical study. So let's take a look at that. Next slide. So we have cleared 100 milligram. That's a safe dose with a few adverse events, grade 1, grade 2. And still, there are clear signs of immune activation in the study. And today, we have preceded and we are now evaluating 200-milligram flat dose. And this, for reference, is more than 20x higher than the competitor, the BMS product. We also have a preliminary signal. In this study, you can see the patients depicted on the low part. Three patients have already stable disease for more than 6 months. That's quite promising for the readout coming in the spring. So that's one of the products, one of the key assets, ATOR-1017. The other one being mitazalimab, next slide. Mitazalimab is a CD40 agonist antibody. And the focus here is on cold tumors, tumors with few integrating T cells because those are, by nature, resistant to PD-1 therapy. So CD40 as a target, it activates antigen presentation. It's like the billboard that shows the immune system water tank. While CD40 improves the antigen presentation that will activate T cells, tumor-specific T cells, and that will then lead to infiltration of T cells into tumors. Such tumors with previously few T cells now having T cells infiltrating, they can then respond to PD-1. And that's a beauty of addressing PD-1 resistant cold tumors. It's a Phase II ready antibody. We are about to submit the CTA in pancreatic cancer, and that will be done in December. So quite soon. So why do we select pancreatic cancer? Let's take a look at the next slide. From one aspect, obviously, very, very high unmet medical need because this has an extremely poor prognosis for pancreatic cancer. That also needs to be being a quick route to the market if there is spectrum. And of course, if we reach the market, there is $1 billion sales potential. The most important argument for selecting pancreatic cancer, though, that has to do with emerging clinical validation. And that's shown on the right-hand side. That's from one of our competitors, these are 3 different studies, but let's first take a look at standard of care therapy, chemotherapy, that's the black bar, around 20% to 30% response rate. The red bar in the middle shows that these cancers are PD-1 resistant. There is no effect of adding PD-1 to the chemo. Then on the right-hand side and you can see the green bar, that's our competitor, Apexigen. They added CD40 to standard of care chemotherapy. Response rates almost doubled. And then they added also PD-1 and response rates increase again up to plus 60%. This is extremely promising and that's really why we are selecting pancreatic cancer. The study we are designing is certainly based on the mechanism of action of our products. So let's take a look at the next slide. Here, we combine with the standard of care chemotherapy cocktail called modified FOLFIRINOX. It's a very strong chemo. It will lead to significant damage to tumor cells. That is given on day one. There is release of tumor antigens because of the damage by chemo. Those are taken up by dendritic cells and presented on the cell surface. And then we give CD40 to improve antigen presentation to activate tumor-specific T cells. And that's why it's given in sequence. And then this is repeated over and over again. This study is about to start in the spring, and we will have a first interim efficacy readout in the end of next year. And the full study will readout by end of 2022. So now to a quick look at our novel innovation concept Neo-X-Prime. Next slide. Neo-X-Prime. This is a novel concept for personalized immunotherapy of cancer in order to cure the patients. So let me put this in a context. As many tumors being resistant immunotherapy because there is poor antigen presentation and poor T cell prime. One of the problem is DCs, dendritic cells, they present everything that's around them. What Neo-X-Prime does is to ensure that this antigen presentation is much more selective and involves tumor-specific and patient-specific neoantigens. So how is this accomplished? If we look on the left-hand side, we use a bispecific antibody and is building on CD40, but also has another component. What it does is it catches tumor components in the circulation, tumor exosomes, which contains tumor neoantigens and then carries those to dendritic cells and make that dendritic cell, take them up selectively and present them on the surface. So this is really interesting in theory because it will make dendritic cells present exactly what we want them to present, the tumor neoantigens. But it's even more interesting in practice. And that's what we are most enthusiastic about. The fact that it is anything we have tested in our models before. And that's shown on the right-hand side. This is an example. The blue bar, that is a combination of 2 monospecific therapeutic antibodies, the CD40 and an EpCAM antibody. The green bar is a corresponding EpCAM bispecific, and it outperforms the monospecific antibodies by far. So very interesting novel concept. And here we are in discussion with partners in order to progress those to clinical development. The reason we are looking for partners, mainly that our focus is today on our clinical programs. So let's take a look at the next slide. Here is a summary. So maybe I can get the next slide. So in summary, we have 2 different products we are looking at. That's ATOR-1017 on the left-hand side, and this is a program that is now completing clinical Phase I. We have already increasing signals and we are presenting the data in the spring next year. And then we are gearing up to start into Phase II. And on the right-hand side, we have another asset, the CD40 antibody mitazalimab. We have completed Phase I, and we are about to submit the CTA for clinical Phase II in pancreatic cancer. So both interesting, entering a very important stage in development. Thank you very much.

Thank you, Per, for a very good presentation. I will start off the Q&A. First, mitazalimab. You are starting a combination trial with a FOLFIRINOX. Can you explain a bit the rationale behind this combination?

Yes, certainly. So there are 2 standard of care -- well, there are more, but the 2 leading standard of care combinations, that is gemcitabine, paclitaxel, and the other one is FOLFIRINOX and are used by approximately the same number of patients. When it comes to gemcitabine, paclitaxel, that's one that was used by our competitors. That is a slightly better tolerated combination of chemotherapy, and it's also slightly lower effect. Why we choose FOLFIRINOX is one part is a stronger activity. It leads to more damage to tumor cells, and that leads to more release of tumor antigens. I think another very important aspect is the fact that FOLFIRINOX being a bit more toxic. It really demands a well-tolerated product. And that is probably one of the reasons our competitors have deselected this combination. We seem to have the best profile when it comes to tolerability and efficacy, and we think we can handle that toxicity. But the very most important part is the fact that being a more toxic chemo, it will be selected for patients with slightly better health status and hopefully better immune system. So that is the reason why we're selecting this combination.

And you see the market potential, is it the minority of patients that are healthy enough to undergo this treatment or?

That is I think for both of those standard of cares, it's minorities. We're talking about a range, 20%, 25% of the patients globally. And that is clearly a quite large population overall. So it's still definitely a blockbuster patient population.

Okay. And we have a question from the viewers. When do you expect to have news regarding preclinical studies together with Scandion Oncology?

Yes. So the preclinical collaboration with Scandion, that is to assess our products in -- well, basically in preclinical models, tumor models. And there are different objectives here. First of all, Scandion, of course, is looking at tumor resistance and how to overcome that. And we are looking for combination with chemo in pancreatic cancer models. So if we can demonstrate the study, which we think there's a good chance to do, that will be shown during the spring, hopefully, in Q1, but it's in the range of 3 to 6 months.

Okay. And regarding -- I have a question regarding 1015 that you haven't really mentioned in the presentation. What opportunities do you see to continue with this project going forward?

Yes. So the background here at 1015 has basically completed the Phase I. There are still some patients getting therapy but we have communicated the data. And what has happened is we have run into some issues with antidrug antibodies, and that also coupled to some immune reactions. So there we need to solve this, how to administer this to patients in a safe way and over time, and we're looking for different ways to get around this problem. And we think we have interesting ways forward. Now it's about a matter of finding a partner to help us developing it because what we can see today is that mitazalimab and 1017 have a more straightforward development path, and that's what we're going to focus our resources on. So on 1015, we are looking for a partner. And hopefully, we can find that during next year, but that remains busy.