BeOne Medicines AG (ONC) Earnings Call Transcript & Summary

Hello, everyone, and welcome to BeiGene's Early Development Pipeline and Research Virtual Event. My name is Gabrielle Zhou, and I'm the Senior Director of Investor Relations at BeiGene. Today's presentation is being conducted entirely online with live translation, and they will be recorded and available on our website in both English and Chinese. [Operator Instructions] After the presentations, we'll take questions from the audience. [Operator Instructions] Before we begin, please be aware that during today's event, we'll be making forward-looking statements, and our business carries certain risks. Some of these are discussed in our filings with the SEC and Hong Kong Stock Exchange. We have the great pleasure of having with us today both of BeiGene's Co-Founders, Dr. Xiaodong Wang and Mr. John Oyler. In addition to being our Co-Founders, Dr. Wang is the Chairman of our Scientific Advisory Board; and Mr. Oyler is BeiGene's Chairman and CEO. In addition, we have our presenters, Dr. Lai Wang, Global Head of R&D, Dr. William Novotny, Head of Clinical Development of Hematology; and Dr. Yong Ben, Chief Medical Officer of Immuno-Oncology. We thank Dr. Novotny for standing in today for Dr. Jane Huang, Chief Medical Officer of Hematology, who is attending to a personal matter. During the Q&A, the presenters will be joined by Dr. Xiaobin Wu, President and Chief Operating Officer; Julia Wang, Chief Financial Officer; Angus Grant, Chief Business Executive; and Josh Neiman, Chief Commercial Officer for North America and Europe. Now I would like to introduce John Oyler, CEO and Co-Founder. John?

Thank you, Gabrielle. Hello, everyone. We really appreciate you joining us today. I think, as most of you know, Xiaodong and I started BeiGene 10 years ago. We had a belief in the power of science. We had a commitment to follow it, and we've invested heavily with that conviction from day 1. From the beginning, there's been a thoughtful, science-led approach to everything that BeiGene is doing with the clear goal of developing for patients impactful medicines that are more affordable and more globally accessible. We hope to share a bit more of our thinking with you today to help you understand what we are doing, why we're doing it and how we've created strategic advantages that will help us achieve this vision. At BeiGene, we put patients first, with an emphasis on 2 things: scientific excellence and affordability. Recently, the biopharma industry as a whole has been quite successful in developing impactful science, but it has failed at affordability, whether in the United States, where 3 out of 10 patients are unable to complete treatment for economic reasons; or globally, where only 3 out of 8 have access to innovative treatments. Medical inequity creates unacceptable problems. Xiaodong has been focused on how to create the elements that are required for scientific excellence, which is not easy, and for innovation. Meanwhile, I focused on business innovation, how to understand and analyze all elements of medicine discovery and development and how to question and overhaul every aspect. Xiaodong and I believe that we simply cannot accept a world where so many patients cannot afford the benefits from science that could improve their lives or save people they love. Next slide, please. As we started with the goal of scientific excellence, but also affordability, Xiaodong and I realized the following important things. First, over 75% of the cost of bringing a medicine to a patient and over 75% of the time is actually spent on clinical trials. It's amazing. The actual cost of goods sold is de minimis. Despite having these small cost of goods sold, only 1/6 of the world has affordable access. So the upfront clinical cost burden has to be covered by much higher prices paid by the 1/6 of the world accessing that medicine. There's fewer patients to spread the costs. Third, clinical trials are lengthy and they're expensive. This is because they've largely been run in the top research hospitals in the richest countries, and it has resulted in lengthy enrollment times that are multiyear and of high costs. The fourth thing we realized was despite clinical science being the most critical element of the system and one that you had to focus on given its predominant impact on cost and timing, typically, this is not something that companies have internalized. Most companies are relying on a handful of third-party CROs, and the net effect is widely recognized to be highly inefficient, expensive and technologically dated. For example, some data from clinical trials might not be available within the clinical trial system for months. From the start, Xiaodong and I realized we had to do the following things to address these problems. First, we needed to internalize everything we could related to clinical trials. If you're not controlling it, you can't change it. Secondly, we need to work with regions that complement our U.S. and European trials by adding additional clinical science sites around the globe in places like China, Australia, New Zealand, Asia and Eastern Europe, and work with these places. Third, develop and implement technology and operational excellence that modernizes the efficiency of clinical science. Xiaodong and my aspirational goal was to reduce time and cost by 50%. It was to create a new distribution model that would triple the number of patients who could access innovative medicines. If we could achieve these 2 things, the upfront cost per patient of a medicine would be reduced to 1/6 of historic costs. Certainly, we felt that was worth the effort. Next slide, please. Given our perspective, Xiaodong and I had been building BeiGene differently from day 1. We're 10, 11 years in and the result is a compelling portfolio, an exceptional fully-integrated team and sustainable competitive advantages. Our oncology research team has become one of the largest around without losing our culture of innovation or our focus or our passion. Our 1,700-plus clinical team across the globe has already run large-scale global clinical trials and experienced 2/3 cost and 2/3 time, and we're still improving. We've built a large manufacturing resources in-house to secure capacity, to ensure flexibility and to control cost. And we've built one of the top oncology commercial teams in China, and we're now becoming impactful commercial force in the U.S. and expanding in Europe, and soon you'll see us much further and much more broadly than most companies go across the globe. Today, BeiGene is 7,000 strong, representing top talent on 5 continents with over 30 regional offices. We have the team and we have the competitive strategic advantages for the future. Now it is my enormous pleasure to introduce my good friend, Xiaodong, Dr. Xiaodong Wang, BeiGene's Co-Founder and Chair of our Scientific Advisory Board.

Thank you very much, John. It's my pleasure to join you here today. Your message "providing the best oncology medicine for the most people globally" highlighted the mission of BeiGene. And it is this mission that drives our R&D strategy and inspires our talented R&D team of more than 2,000 scientists and clinical development professionals to work hard every day. Next slide, please. Like John said, although oncology field has been in the midst of scientific revolution in the last decade, highlighted by tumor immunology therapy and targeted therapy with significant improvement of patient survival rate in major solid and liquid tumors, cancer as a whole, however, still presents a major medical challenge for the drug development and the medical community. Last year alone, nearly 10 million deaths worldwide were still attributed to cancer. Therefore, although BeiGene has been lucky to be born at the dawn of this oncology revolution and it contributed with its own differentiated anti-PD-1 antibody and the best-in-class BTK inhibitor, we have been continuing to build up our R&D team to enhance our technology capabilities, to optimize our decision-making process and in the meantime, to maintain our entrepreneurial inclusive, interactive, antihierarchical environment in which colleagues and ideas alike can thrive. As a result, BeiGene now has a prolific pipeline, both at the preclinical and clinical stages, that rival big pharmas and addresses about 80% of the world cancer by incident. Additionally, as cancer treatment moves more and more towards precision medicine, a combinatorial approach for a group or even individual patients with a deep therapeutic agent toolbox has become essential. To be able to develop this oncology toolbox needs deep scientific understanding of the disease, technology [indiscernible], culture innovation as well as scale and operational efficiency that BeiGene has and will continue to build. Today, you will hear some of the results of this effort from our Head of R&D, Dr. Lai Wang. And more excitingly, such a platform will serve as our launching pad for BeiGene to rocket upwards to serve our mission that John has just eloquently articulated. And now I'll give you our Head of R&D, Dr. Lai Wang.

Thank you, Xiaodong. As John and Xiaodong just highlighted, BeiGene is on a mission to bring innovative and affordable medicines to more patients around the globe. In order to achieve that, we have been focusing on building an R&D engine at a scale to fuel innovation with efficiency and quality. Our clinical research team has been highly productive with proven track records. In the past couple of years, it went through a major expansion. On the clinical development side, we are now largely CRO-free, with unique global operating model to drive [indiscernible] and cost efficiency. Through our prolific internal discovery engine and external collaborations, BeiGene has now close to 100 programs in our pipeline. BeiGene's deeper portfolio provides a toolbox with ample tools for combinations, especially centered around our 2 cornerstone assets, BTK and PD-1. BeiGene's research team evolved through 2 stages. From 2011 to 2018, we were relatively small with around 150 to 200 centers. It has a proven track record with 3 internally discovered medicines already on the market. However, due to the small scale, that team was only able to deliver 1 to 2 molecule [indiscernible] clinic on a yearly basis. In the past 2 years, the preclinical research team experienced a major expansion, triple size to 650-plus now with plans to grow to 800 by the year-end. It is quite amazing growth even when I look back at it. With that, BeiGene will have one of the largest discovery teams in the world, mainly focused on oncology. Usually, expansion will lead to decreased efficiency or slowdown on innovation. This hasn't been the case for us. Our discovery productivity has improved, with new platforms, capability buildup and portfolio management. There are currently 50-plus preclinical programs ongoing, including close to half with first-in-class potential. With this expansion, we do expect a burst of new molecules entering [indiscernible] in the next few years. To support this growing pipeline, we have also been building internal clinical development capability to run global clinical developments with scale. Through the extensive internalization efforts in the last few years, we are now largely CRO-free. This is not a trivial undertaking, and it is not possible for a small biotech [ result in ] the stable volume of clinical trials. The internal development capability gives us significantly better control on quality, speed and cost as well as site investigator engagement. BeiGene currently has more than 1,700 clinical development colleagues around the globe, including close to 700 outside of China and they expect to be over 2,000 by the year-end. We're also building an internal training academy to allow for continuous growth of this very high-quality team. New development is the most expensive part of our industry and takes the most time. As shown in the 2 graphs on the left, cost and enrollment rates varies dramatically in different regions and the countries. The graph on the top uses investigator fee as an example to illustrate per patient cost difference. The graph on the bottom shows patient enrollment rates in first-line lung cancer comparing our own channel-only study number versus reference numbers from public database. BeiGene's trial enrollment distribution is shown on the pie chart on the top right corner. The ratio is probably quite different from what you would typically see with the multinational big pharmas. We're enrolling around half patients -- half of the patients in China and close to 3/4 in APAC region. This special composition of our clinical trial subjects and the internal capability to execute the clinical trials in these regions allow us to run trials at around 2/3 of costs and 2/3 of time. Meanwhile, we are committed to the highest quality standard with successful inspections by NMPA, FDA, Swissmedic and our pharma partners. Our discovery engine has been productive since day 1. In the first wave of internally discovered clinical molecules 2 out of 4 are now on the market, helping patients around growth. From 2016 to 2020, second wave, some new molecules enter the clinic, mainly focused on combining with PD-1 or BTK. TIGIT is now at a pivotal stage, and we expect BCL-2 will be there soon. Starting from 2021, we're in a new era to translate our science to novel medicines. We are more productive than ever with the upgraded discovery engine in both size and technology. Today, we will share with you the recent update for some of these programs as well as the new exciting platforms. Meanwhile, BeiGene is also enhancing innovation through various collaborations, for example, with our PD-1 inhibitor tislelizumab, while extending our existing franchise in large indications through novel combinations with sitravatinib [indiscernible] from Mirati and zanidatamab from Zymeworks and the Leap Therapeutics assets. And we are building collaborations with partners on next-generation technologies such as antibody-drug conjugation, [ MRA ] and [indiscernible]. Through both internal and external collaboration, BeiGene has built a deep pipeline in which a total of 45 assets are at commercial or clinical stage. Now I'm going to hand it over to Dr. Bill Novotny, SVP for Clinical Development, Hematology to talk about our hemo pipelines. Bill?

Thanks, Lai. My name is Bill Novotny, and I am the Senior Vice President of Hematology Clinical Development at BeiGene. I've been with the company 5 years. And today, I'm pinch-hitting for Jane Huang, our Chief Medical Officer for Hematology, who would usually give this talk. This slide shows BeiGene's broad and deep hematology portfolio. Most people know we are deeply invested in the development of zanubrutinib in CLL and other B-cell malignancies, but few appreciate our substantial development efforts in acute myelocytic leukemia and myelodysplasia as well as multiple myeloma through both internal discovery and external collaboration. Zanubrutinib was designed to overcome the shortcomings of ibrutinib. BeiGene started with a hypothesis that improvements could be made upon ibrutinib to improve both safety and efficacy outcomes, improving safety by reducing inhibition of off-target tyrosine kinases and improving efficacy by complete and sustained BTK inhibition in leukemia and lymphoma tissue. And in the clinic, zanubrutinib has demonstrated superiority over ibrutinib, with better efficacy, better safety and more convenience for patients. We have broad registrational programs ongoing for CLL, mantle cell lymphoma, Waldenstrom's macroglobulinemia, marginal zone lymphoma and other B-cell malignancies. The kinome analysis shown on this slide was conducted at an independent laboratory. First, the IC50 for BTK was measured independently for zanubrutinib, ibrutinib, acalabrutinib and acalabrutinib's major metabolite, M27. Then kinase selectivity was determined after adjusting the concentration of each molecule to 100x each molecule's own IC50 for BTK. We believe this method provides a fair and more accurate determination of selectivity for different BTK inhibitors as compared with using identical concentration of molecules regardless of potency. Each dot on the figure represents off-target inhibition of a kinase of more than 50%. In this analysis, zanubrutinib demonstrated higher kinase selectivity as compared with ibrutinib, acalabrutinib and M27, potentially explaining zanubrutinib's excellent safety profile in the clinic. In the blood plasma of patients, zanubrutinib can maintain trough-free drug levels sevenfold above the IC50 when dosed 160 milligrams twice daily, and twofold above the IC50 when dosed at 320 milligrams once daily. In contrast, levels of ibrutinib, acalabrutinib and M27 all fell below the IC50 line very quickly after reaching the peak of their pharmacokinetic curves. We believe this data provides a mechanistic explanation of why zanubrutinib is able to provide deeper and more sustained BTK inhibition, which should translate into better efficacy outcomes. The clinical development program of zanubrutinib for the treatment of various B-cell malignancies is broad and includes 2 large Phase III head-to-head trials versus ibrutinib. To date, we have treated over 2,300 patients around the globe in BeiGene-sponsored clinical trials. Countries with either approvals, filings and/or trials of zanubrutinib are shown in the bottom of the slide. In the next few slides, I'm going to show you the results from our clinical trials of zanubrutinib in CLL, including the SEQUOIA, ALPINE and AU-003 studies. These results validate our confidence in zanubrutinib as a treatment that can improve safety and efficacy outcomes for hundreds of thousands of patients living with CLL. This is a schema of SEQUOIA study comparing zanubrutinib to bendamustine rituximab for standard chemo immunotherapy in patients with treatment-naive CLL. Last month, BeiGene announced that the trial met its primary endpoint at an interim analysis, with zanubrutinib significantly prolonging progression-free survival compared with bendamustine rituximab. SEQUOIA was the second positive global Phase III trial of zanubrutinib in CLL following the ALPINE study. ALPINE is a randomized global Phase III trial comparing zanubrutinib with ibrutinib in patients with previously-treated CLL. Zanubrutinib met the primary endpoint of the trial, demonstrating superiority and overall response rate with a p-value of less than 0.0001. The interim analysis from this fully enrolled ongoing trial is based on 415 of 652 patients followed for a minimum of 12 months. Analyses for progression-free survival and overall survival showed trends favoring zanubrutinib even though the data was immature. We continue to follow the ALPINE study to the final response rate and progression-free survival analyses. On this slide, I'm showing you our global Phase I/II study, AU-003, with over 3 years median follow-up in which we observed a landmark progression-free survival of 90.6% at 24 months and 82.8% at 36 months, suggesting a very durable clinical benefit in relapsed/refractory CLL. The AU-003 study began in 2014, and it's very gratifying that we still have patients who started zanubrutinib in 2014 or 2015 and still continue to this day with disease control and very tolerable therapy. So next, turning to mantle cell lymphoma. At the European Hematology Association meeting this year, we presented long-term follow-up data from our 206 study showing a very high complete response rate of 77.9% and median progression-free survival of 33 months. Although there is limitation to cross trial comparisons, other BTK inhibitors reported 13 to 22 months of median progression-free survival in relapsed/refractory mantle cell lymphoma. This is consistent with our scientific hypothesis that complete and sustained BTK inhibition will result in improved efficacy outcomes. Moving to Waldenstrom's macroglobulinemia. The ASPEN study is a randomized Phase III trial comparing zanubrutinib with ibrutinib for the treatment of both treatment-naive and relapsed/refractory Waldenstrom's macroglobulinemia. Zanubrutinib demonstrated a higher rate of very good partial response plus complete response and favorable trends in progression-free survival and overall survival, although, unfortunately, the trial did not achieve statistical significance in its primary end point. This slide shows the safety overviews for our 2 trials that have head-to-head comparisons with ibrutinib. On the left is the ALPINE study in CLL, and on the right is the ASPEN study in Waldenstrom's. If you focus on the row showing adverse events leading to death and adverse events leading to treatment discontinuation, you see very consistent improvement in tolerability with zanubrutinib as compared with ibrutinib. Zanubrutinib has dramatically lower rates of cardiovascular toxicities as compared with ibrutinib. Shown here are time-to-event analyses. On the left are curves for time to atrial fibrillation in the ALPINE study and CLL. In the middle is the curve for time to atrial fibrillation in the ASPEN study in Waldenstrom's macroglobulinemia. And on the right are curves for time to hypertension in the ASPEN study in Waldenstrom's macroglobulinemia. In addition to superior efficacy and safety as compared with ibrutinib, the clinical pharmacology profile of zanubrutinib translates into more convenience for patients. Zanubrutinib can be dosed at either 160 milligrams twice daily or 320 milligrams once daily. Zanubrutinib can be taken with or without food and has fewer drug-drug interactions, allowing it to be co-administered with a broader variety of concomitant medications. Zanubrutinib can be safely used in patients with renal or liver impairment. For example, zanubrutinib can be used in patients with severe hepatic impairment, while the ibrutinib label recommends avoiding use in that population. To provide access to many more patients, the global footprint of zanubrutinib continues to expand to more than 70 countries. In 2019, we completed 14 regulatory submissions for approval and received 2 approvals. In 2020, we completed 22 submissions. Now in 2021, we have completed 40-plus submissions and have 9 to 12 approvals expected soon. We are working hard to bring this best-in-class BTK inhibitor to more patients in need. To further strengthen our hematology portfolio, we are developing BGB-11417, an investigational BCL-2 inhibitor with potential best-in-class properties. The storyline around 11417 is quite like that of zanubrutinib. It is more selective and more potent than venetoclax, which we hope will translate into better efficacy and safety outcomes in the clinic. In addition, it has potential to overcome the resistance to venetoclax, which has emerged as a problem in the clinic. It has become a key molecule in our hematology portfolio, will be combined with zanubrutinib and B-cell malignancies and provides an entry point to AML, MDS as well as multiple myeloma. The dose escalation for 11417 is now ongoing for monotherapy of 11417, also in combination with zanubrutinib, also in combination with azacitidine. Clinical activity was observed at the first dose level of 40 milligrams. The PK exposure at 80-milligram level is equivalent to that of venetoclax at its CLL approved dose of 400 milligrams. Currently, 11417 is being studied at the 320-milligram dose level, and pivotal studies are expected to be initiated in 2022. So to summarize, for B-cell malignancies, we are building around zanubrutinib, our best-in-class BTK inhibitor. Results from large randomized clinical studies have supported our hypothesis that improvements could be made upon both safety and efficacy outcomes as compared with ibrutinib. In addition, we are exploring many combination opportunities, including with our own BCL-2 inhibitor, an inhibitor of PI3 kinase delta, REVLIMID, et cetera. In addition, many new exciting molecules are coming in the pipeline, including BTK, CDAC, CAR NK, bispecifics ADC, et cetera. You will hear more about this later when Lai talks about the new modalities we are pursuing. We are also entering the AML, MDS space with potentially best-in-class BCL-2 inhibitor, 11417, along with our growing pipeline, including agents targeting CD70, TIM-3, CD33, FLT3 and MCL-1. With that, I conclude my section, and would like to hand over the floor to Dr. Yong Ben, our CMO, for immuno-oncology.

Thanks, Bill. Now I'm going to walk you through our solid tumor portfolio. Through both internal discovery and external collaboration, BeiGene has built a deep and broad tumor, solid tumor portfolio, including multiple marketed products, ever-growing late-stage assets, a robust and diversified early pipeline that contains a wide range of modalities such as a small molecule monoclonal antibody bispecific antibody, ADC essential. In the next few minutes, I'll walk you through some selected programs. Tislelizumab is a truly differentiated humanized IgG4 anti-PD-1 monoclonal antibody invented by BeiGene scientists, specifically designed to minimize binding to Fc gamma receptor, thus minimizing antibody-dependent cellular phagocytosis or PD-1-expressing T-cells by macrophages, therefore, maximizing T factor cells in tumor microenvironment. This scientific hypothesis was tested and further validated in clinical trials. New [indiscernible] trials in patients with relapsed/refractory classical Hodgkin's lymphoma showed impressive clinical activity with a complete response rate of [ 67.1% ] and medium PFS of 31.5 months. [indiscernible] limitation across our comparison, both CR rate and the medium PFS look quite favorable compared to data from other PD-1 antibody studies in the same setting and very similar population conducted around the same time as our trial. Interestingly, CHL is a tumor type that's enriched with macrophages. We have developed quite a broad clinical development program for tislelizumab. To date, Tisle has received 5 market approvals in China including first-line both squamous and non-squamous non-small cell lung cancer; second-, third-line urothelial carcinoma, second-line plus hepatocellular carcinoma and the relapsed/refractory CHL. In addition, 4 supplemental BLAs are currently under review by the CDE. Moreover, there are 11 additional registrational trials ongoing or being planned either as a monotherapy or in combination with our pipeline molecules. Seven of those as monotherapy are in combination with the standard of care are expected to read out in the next 36 months. Earlier this year, we announced the collaboration with Novartis on Tisle. This certainly opens opportunities for Tisle to combine with molecules in Novartis' robust oncology pipeline. To date, over 5,000 patients have been treated with Tisle on BeiGene-sponsored clinical trials, including almost 1,800 patients outside of Mainland China. The collaboration with Boehringer Ingelheim, one of the world's leading biologics manufacturers, ensures global manufacturing quality. Centered around PD-1, our strong solid tumor portfolio is being built based on solid scientific rationales. We are pursuing diverse mechanism of actions that potentially can synergize with PD-1 and/or overcome PD-1 resistance, including removing other checkpoint inhibition, such as TIGIT and HPK1, directly activating T-cells with agonists such as OX40 and bispecific antibodies with T-cell engagers, inducing immunogenic cell death to enhance antigen spreading and presentation like zanidatamab and ZW49. And finally, reshaping immuno-suppressor tumor microenvironment to overcome PD-1 resistance such as sitravatinib, TIM-3, PI3K delta and so on. Ociperlimab is another BeiGene in-house discovered monoclonal antibody against TIGIT. Similar to PD-1, TIGIT is an inhibitory receptor upregulated upon T-cell activation. Based on this mechanism of action, ociperlimab is positioned to work together with tislelizumab to augment clinical response in PD-1-sensitive tumors. Ociperlimab is one of the most advanced and potent anti-TIGIT antibodies. We made a data-driven decision very early on to start our Phase I combining with Tisle based on our preclinical data. With all the available data so far, that was a clear right decision, which allows to advance this program rapidly into pivotal stage to be competitive in the leading pack. To date, more than 200 patients have been treated with ociper-tisle combination. The combination is well tolerated without additional safety signal compared to PD-1 monotherapy. We are quite comfortable with the early antitumor activity seen so far. Two Phase III studies have been initiated earlier this year in non-small cell lung cancer, and ociperlimab clinical program continues to be rapidly expanded, which I will show you in the next slide. The AdvantTIG-301 and 302 are the 2 Phase III studies initiated in patients with untreated, locally advanced, unresectable non-small cell lung and first-line PD-L1 [indiscernible] in non-small cell lung, respectively. Five Phase II studies have started or are about to start in tumor types such as non-small cell lung, small cell lung, cervical cancer, esophageal squamous carcinoma and hepatocellular carcinoma. Lastly, BGB-900-105 is our ongoing Phase II -- Phase I/Phase II study in a variety of tumor types. Additional citings and the indication are being further explored. Sitravatinib is a potent multikinase inhibitor designed to overcome immune resistance where reversing immunosuppressive tumor marker environment. [indiscernible] tumor-promoting androgenesis by targeting VEGF receptor. Sitravatinib also surprises the microphaging immunosuppressive activities by inhibiting TAM family kinases such as Axl, TYRO3 and MER. BeiGene is developing this program in collaboration with Mirati. As shown on this slide, combination for sitravatinib with PD-1 showed promising clinical activity in several PD-1 refractory/relapsed tumors or PD-1 cold tumor. Based on our internal Phase II data as well Mirati's Phase II data in non-small cell lung cancer, a Phase III study investigating the combination for sitravatinib with tislelizumab in non-small cell lung patients including both squamous and non-squamous histology have been initiated recently. The breadth of BeiGene solid tumor portfolio not only allows to develop a robust combination of strategies and also tumor-focused strategies in multiple tumor types. Non-small cell lung is one of examples where we have a number of Phase III trials that cover a full range of disease settings from early to late lines, treatment-naive to treatment resistance. As shown on this slide, we have 2 ongoing Phase III trials in early setting, one in neoadjuvant and adjuvant setting, the other one in unresectable locally advanced Stage III setting. In terms of first-line and beyond, we have 5 Phase III trials, among which 3 have [indiscernible] positive at the interim, 2 are currently ongoing. So next program is zanidatamab, a bispecific HER2 antibody that BeiGene is developing in collaboration with Zymeworks. It's designed to simultaneously bind to 2 distinct HER2 epitopes where trastuzumab and pertuzumab bind. This unique mechanism of action provides increased tumor cell binding and enhanced HER2 internalization compared to trastuzumab and translated to encouraging activity across multiple HER2-expressing tumor types in the clinic. A single-arm Phase II pivotal trial in second, third-line HER2-positive biliary tract cancer has been initiated last year and the Phase III in combination with chemo Tisle in first-line HER2-positive gastric GE junction cancer will be initiated later this year. BGB-445 (sic) [ BGB-A445 ] is another truly differentiated, unique OX40 agonistic antibody with distinct -- distinguished mechanism of action compared to other OX40 antibodies in the clinic. As illustrated on the right of the slide, other OX40 antibodies in the clinic are ligand blocking, thus, induce suboptimal OX40 signaling in T-cells and also lead to loss of OX40 ligand signaling in APC cells, which translated to less optimal activity in the clinic especially at a higher dose level, which is so-called [indiscernible] effect. In contrast, BGB-A445 retains OX40 ligand signaling in APC cells while achieve maximum T-cell activation because of a non-ligand blocking feature. Currently, dose escalation is ongoing for BGB-A445 as either monotherapy in combination with tislelizumab. Safety-wise, it's quite tolerable and no DLT to date. In terms of efficacy, we're excited to see antitumor activities in both mono and combo cohorts. BeiGene plans to start a dose expansion Phase II portion of the trial later this year or early next year. The next molecule is our potential first-in-class HPK1 inhibitor BGB-15025. HPK1 stays downstream of TCR signaling and functions as an intracellular immune checkpoint to inhibit T-cell activity. Based on its mechanism of action, we believe our HPK1 inhibitor is well positioned to be combined with Tisle in PD-1-sensitive tumors. HPK1 is not an easy kinase to target due to its low -- very low [indiscernible]. BGB-15025 has impressive kinome selectivity, robust activity and a good safety profile in preclinical studies, and Phase I dose escalation is currently ongoing. Due to time limitation, I did not have a chance to cover many other programs in our solid tumor portfolio. I hope I will convince you that we have built deep and robust clinical programs based on our science. We continue to be very focused on combination strategies with the aim to address some of the key scientific questions and unmet medical needs, for example, PD-1 resistance. While we are extremely excited to see more assets in our portfolio entering late stage, we are equally excited about the multiple waves and molecules coming from our discovery research. Now I'm going to pass it over to Lai who will lift the curtain on BeiGene's new modalities and upcoming pipeline for you. Lai?

Thanks, Ben. In the first decade of BeiGene's history, all internally discovered molecules in the [indiscernible] were either traditional small molecules or monoclonal antibodies and we achieved many success. However, the limitations associated with this traditional modalities. What we can do is often gated by what we know and the technology we have. Human being will continue to uncover the fundamental science behind life and death. On the other hand, biotechnology has evolved tremendously in the past half century, and it is taking a different trajectory in this growth in the last decade. We truly believe the growth of biotechnology will propel this industry to a new high and help us to address many unmet medical needs. BeiGene has invested heavily in new technologies, which I'm going to walk you through in the great details in the next few slides. Here are the 2 goals we're trying to achieve with these new technologies: drugging the undruggable and the precise tumor targeting. The former will help us solve many unsolved problems, while the latter will reduce systemic toxicity associated with anticancer medicines and an improved quality of life for patients. First, let's talk about drugging the undruggable. Many targets are historically considered undruggable due to many different reasons: lack of enzymatic activity, no suitable binding pockets, difficult to disrupt the protein-protein interactions. CDAC, or chimeric degradation activating compound, is a bivalent molecule that brings the target of interest and the ubiquitin E3 ligase into proximity that induce it -- induces selective targeted [indiscernible] and degradation. With this mechanism of action, CDAC can be used to hit a target that does not have enzymatic activity. Another major hurdle for traditional small molecule is to identify strong and persistent binder to a particular target. The target binding requirement for CDAC is low due to its catalytic nature. Finally, CDAC can also eliminate the scaffolding function of a target with all these characteristics. CDAC has opened the door for medicinal chemistry to hit many targets that were previously considered undruggable. BeiGene is expanding our knowledge and building strong capability to work on novel E3 ligase, including both ubiquitously expressed and tissue-specific ones. Bottom left panel shows an example of E3 ligase with different degree of tissue specificity. By leveraging tissue-specific E3 ligase, CDAC can achieve tissue-specific target degradation, therefore reducing toxicity associated with ubiquitously-targeted demolishment. In addition, novel E3 ligase possess other favorable applications such as overcoming tissue-associated drug resistance and a broadening [ substrate ] spectrum. We have multiple CDAC program ongoing, covering various signaling pathways. Many of these are previously considered undruggable. Some of them have [indiscernible] scaffolding functions. Our CDAC platform is positioned to significantly broaden our solid tumor, hematology, oncology and immuno-oncology portfolios. Worth also mentioning is that many of these programs are applied in tissue-selective E3 ligase system. Here, I'm excited to introduce our first CDAC program, BTK CDAC. BTK is a kinase and is certainly druggable. So why do we still need to make a CDAC? BTK CDAC can overcome multiple resistant mechanisms to BTK kinase inhibitors, including cysteine 481 serum mutation reported for irreversible BTK inhibitors as well as scaffolding function for BTK protein, which has been suggested to actively downstream B-cell signaling pathway in a kinase independent manner. We believe BTK CDAC can further strengthen our BTK franchise. BGB-16673 is a highly potent and selective BTK degrader. It has good oral bioavailability and a long half-life. It was well tolerated in animal studies. We expect the first in-human study to be initiated in the next couple of months. As shown in the figure on the right, BGB-16673 is highly effective in inhibiting C41S-mutation tumor growth. Next, we will talk about precise tumor targeting. Tumor-associated antigen, TAA, provide a perfect means to achieve tumor-specific targeting. There are currently 10-plus TAA antibodies being developed at BeiGene. This TAAs cover a broad spectrum of cancer types, including prevalent solid tumors as well as hemo indications. These TAA antibodies can provide a variety of opportunities to develop precise -- precision tumor targeting therapeutics via tumor-selective immune cell activation and a tumor targeted cell killing. In addition, we are also developing tumor-selective cytokine using a [indiscernible] formats. Next, I will dive into details for these different modalities. One way to achieve tumor-specific immune cell activation is pair TAA antibodies with immune cell engagers, On the TAA side, it can be either monospecific or dual targeting. Dual-TAA targeting could further enhance tumor specificity and affinity. On the immune cell side, we have multiple immune cell engager programs ongoing, including 4-1BB and the CD3 for T-cells and the CD16 for NK cells. BeiGene has built a comprehensive bi-, tri-specific antibody discovery platforms to achieve diverse formats for different mechanism of actions and to ensure speedy and successful delivery of drug-like molecules. This includes llama single domain antibody screen platform, human single domain antibody phage library, common light chain antibody and the single-chain Fv engineering platform. Another means to achieve tumor-specific immune cell activation is to use external immune cells expressing a CAR, chimeric antigen receptor, that will recognize TAA on the tumor cells. The field was pioneered by autologous CAR-T therapies, but they present significant manufacturing and the safety hurdles. That said, with the recent advancement on deriving allogenic, off-the-shelf and the reproducible single-source [indiscernible] product, it is now possible to overcome these challenges. Recent early data on off-the-shelf [indiscernible] suggests that clinical activity with much improved with the safety profile. Our strategy is to jump start with a key collaboration with Shoreline to fast track some programs into clinic, while allow our internal capability to facilitate the partnership and growth to expand the future pipeline. The collaboration with Shoreline and BeiGene is quite complementary, taking full advantage of Shoreline's expertise in iPSC NK functionality and the cell therapy and the BeiGene's capability in biologics and clinical development. Portfolio-wise, we expect iPSC-derived CAR NK will be the initial focus but we will keep our [indiscernible] out on other immune cell types with therapeutic value. TA antibody can also be used as a missile to bring small molecules to the tumor microenvironment. This is often known as antibody-drug conjugate, ADC. We are developing ADCs with 2 different mode of actions. One is traditional ADC that delivers a toxin to cure tumor cells. Another mode is to bring immune stimulator to tumor microenvironment to trigger local immune activation. This is called immune stimulating antibody conjugates, ISAC. BeiGene currently has TLR7/8 [indiscernible] ISAC programs ongoing. BeiGene's ADC platforms aims to develop next-generation ADC designed to have superior efficacy and the safety. One strategy is through collaboration with Ambrx to generate ADC with universal [indiscernible]. Ambrx' platform is differentiated in its stable site-specific conjugation technology for your precision incorporation of non-natural [indiscernible] asset and has been clinically validated. Innovative linker design is another direction with the goal to utilize hydrophilic and/or masking linkers to improve ADC by physical property and stability, and to fine-tune cleavage kinetics to enable tumor-selective cleavage. Lymphocyte-stimulatory cytokines have always been an attractive direction to pursue in [ IO ] field However, the application is largely limited by on-target toxicities of systemic activation of the immune system. As illustrated in the graph on the right, [indiscernible] cytokine design is to keep cytokine in an inactive state in the circulation by a masking [indiscernible] to a peptide linker, which is cleaved by our tumor-specific proteus in the tumor microenvironment. This release -- releasing the active cytokine and achieving local activation of immune cells. BeiGene's proprietary [indiscernible] cytokine design is potentially superior to some of the competitors for the following reasons: complete masking of cytokine [indiscernible] peripheral, full recovery of its FTP once cleaved, extended half-life and a plug-and-play format that can be readily applied to various cytokines of interest. Our discovery engine experienced exponential growth since 2019, not only in scale, but also in technology and platform. There are over 50 preclinical programs currently ongoing at a various stage. We expect that the new number of -- the number of new clinical molecules per year will accelerate with more than 10 potentially first-in-class or best-in-class projected to enter the clinic in the next 24 months. Starting from 2019, BeiGene began to invest in immunology and information. Our first II molecule is expected to hit a clinic later this year. In addition, I'm very excited to share with you that we are building a BeiGene institute to focus on early technology and the translational science. On this slide, I want to use immuno-oncology as an example to show you the breadth of BeiGene's portfolio. Immuno-oncology has certainly been the main focus for BeiGene. This figure laid out our current clinical commercial stage assets, and I hope you can appreciate that we are developing molecules to mobilize the factor cells as well as reshaping suppressive tumor microenvironment for multiple entry points in the immuno cycle. On top of our existing assets, even without TAA-based therapeutics included here, you can see 10-plus more immune modulating programs are being developed at BeiGene as the next wave of cancer-attacking therapeutics such as [ TRAC ] and [indiscernible] cell depletion molecules, NKT stimulating cytokines as well as other novel targets to rejuvenate antitumor immune functions. I'm sure you would also appreciate TAA-based bi-, tri-specific immune cell engagers, [indiscernible] and the ADCs will further light up the tumor microenvironment and can be combined with many agents shown here. We have shown you a lot today because we have accomplished a lot since last year. But let me say you're only seeing the tip of iceberg when you consider BeiGene's journey. Zanubrutinib and tislelizumab demonstrate our scientists' expertise and their passion as well as the significant role we're playing -- we play in advancing new breakthroughs for cancer. Our strong and diverse portfolio has been built around this [indiscernible] assets and many of them are now entering the pivotal stage. In addition, today's review has shown you that BeiGene's R&D model is innovative, unique and [indiscernible]. Our discovery engine is continually growing and stronger than ever as we have the culture in our labs and the talent to do [ great things ]. The clinical pipeline is expected to quickly accelerate in the next few years. With a deep portfolio, we have a [ toolbox ], as Xiaodong referenced earlier to develop novel and science-based combinations, with our truly international global clinical development capability, while we are suited to handle the quick growing clinical portfolio at 2/3 of cost and 2/3 of time and ultimately bring innovative and affordable medicines to patients around the globe. Our journey continues. And I promise much more to come. With that, I will hand it over to John for closing remarks.

Thank you, Lai. Xiaodong and I laid out at the beginning, our vision and our goal and the mission. It was to provide great science to impact patients, but to do so affordably with more accessibility around the globe. That's been the goal. To do that, we built these strategic capabilities that we saw would be important in the future. We've talked about it. One is our global clinical development team at 2/3 the cost and 2/3 of the time and improving. That is a capability that we're proud of, and you've seen and it's real. From the second perspective, we built innovative science team. That's hard to do. Some companies are successful, but it's very challenging to build that culture and that true innovation. We've been successful at doing that, too. And as Lai pointed out, we've been able to do that at scale, which is always a challenge. The third competitive advantage we talked about was building distribution in China as that was a greenfield space and becoming one of the true leaders there. And I think we haven't talked about that today, but it's very clear that we're incredibly well positioned in that space. But as we think about today, what have we learned over the past decade, certainly, some things we've learned. One thing we learned along the way was it's very important to control your own manufacturing. You need it for speed and for flexibility. Another thing that we've learned is science has been even more impactful than Xiaodong and I envisioned in the last 10 years. There's so much going on that to keep up with it, you need to have deep understanding and breadth of knowledge. The third thing, it's very competitive, more competitive than anyone would have imagined. So speed is critical and important in the future. And I think the last thing is it's very clear new modalities are going to play an important role. We have to follow the science as we committed to from the beginning. That's where it takes you. So what does that mean? We're also trying to do to complement these first strategic capabilities we were building. Well, first of all, it's not a subject for today, but we had to build our own manufacturing capabilities so that we could act with speed so that we would have that flexibility. So we would have cost advantages there. Simply, Xiaodong and I didn't understand that at the time, but it's clear today. It's a very important competitive advantage. The second thing we realized we need to follow the science into the new modalities, critically important. And that's been being done and is now being shared. The third thing that was obvious is a lot of the future is going to be around combinations. And if you think of what the implications are of that, there's 2. The first implication is organizations that have a broader toolbox of building blocks for combination solutions are going to have a lot of advantages. They're going to have advantages in clinical development because they can move with speed. They're going to have advantages in clinical development because they're going to have lower costs and partnering with other companies or purchasing things they need to do that clinical development. And the second implication is the nature of those studies, they're going to be bigger. They're going to require more clinical characterization, more science that's being done at the clinical level, not just the preclinical level. As a result, an organization that can be more effective in cost and time clinically has a huge set of advantages in that world. So as you think of how you build those, it's very important for us to have this broad toolbox, and it will be a strategic advantage in the future. I think as you've seen over time, BeiGene is a company that's bold. We're a company that's persistent. We're a company that's thoughtful about what we're doing. And not only are we developing great medicines, but we're doing it in a way that's very unique. We're trying to do what's right for patients all around the globe. And with that, I would like to thank you for your listening today, and I'll hand over to Gabrielle for our questions and answers.

Thank you, John. With that, we conclude our prepared remarks. For our Q&A session, the speakers will be joined by our senior leaders you see pictured here. Julia Wang, our Chief Financial Officer, will moderate the Q&A. [Operator Instructions] Our first question comes from the line of Andy Berens.

Just because I wanted to get a little more color on the BCL-2 program 417. What type of resistance are you hoping to target with your drug? And then also, you mentioned the profile. You hope to have a profile similar in terms of safety, tolerability to [ zanub ] in the BTK market. What specifically are you hoping to improve upon versus the venetoclax.

Andy, thank you for the question. Hey, Lai, can you please respond this question regarding BCL-2?

Sure. Thank you so much, Andy, for the question. In terms of our BGB-11417, as Bill illustrated, this molecule has better selectivity as well as better potency compared to the net class. We actually believe the story line will be very similar to whether we have been telling you about our BTK inhibitor compared to ibrutinib. So also, as Bill mentioned, at this moment, the clinic, we already reached the 320-milligram QD daily dosing. And we actually absorbed the PK at 80-milligram similar to ibrutinib venetoclax PK exposure at its clinical dose in CLL at 400 milligrams. So if you think about it, we are probably about four-fold [indiscernible] exposure now already compared to venetoclax. That's quite impressive. In terms of the resistance, venetoclax has reported several resistance inducing CLL, including G101V, This [ molecule ] 11417 can indeed hit G101V mutations. And in addition to that, I can tell you, we actually have another BCL-2 molecule in our pipeline which can probably hit the G101V even harder and also included some of the other BCL-2 mutation has emerged with venetoclax. And I think the question you have also is about what's the kind of clinical demand plan and how are we going to move this forward. We are still in the dose escalation, and we are very excited about what we have seen so far. And so far, the activity as well as safety is on par with what we should have already predicted based on the [ clinical ] data. The goal is certainly one of the key space is in combination with BTK in the CLL. But besides that, we do believe there's multiple applications for BCL-2 outside of CLL. So including other B-cell malignancies such as mantle cell lymphoma, DLBCL as well as you can get into the AML, MDS and also multiple myeloma. And also, there has been a report about BCL-2 can potentially play a role in solid tumor. And if you think about it, for a medicine to get into a solid tumor, usually you require higher exposure because often time, the drug concentration in tumor is lower compared to in the plasma. So if we can indeed achieve high exposure in the plasma, we actually probably has a better chance to hit BCL-2 in the solid tumor. So we are indeed developing a broad program around our BCL-2 to be combined with our BTK as well as getting into other disease settings.

Our next question comes from the line of Eve Reilly.

It's Yaron Werber, Cowen. I'm not sure if you can hear me.

Yes, we can hear you.

We can hear.

Okay. Great. I have a couple of questions. The first one is on sitravatinib. So it looks like you're now moving into a pivotal study in PD-1 relapsed/refractory patients in combination with Tisle. So it's going to be in second or third line. How is that study different than the Mirati study that's going on that's going to yield data late next year. And then secondly, on the [ Seattle ] collaboration, it looks like this is the first time that I've seen that it looks like it's targeting CD70. So I assume it's an ADC compound. Cusatuzumab from J&J and Argenx showed really solid data as monotherapy, but when they went into first-line in combination with venetoclax and VIDAZA, J&J returned the rights. We think the efficacy was there, but it looks like it was probably a narrow therapeutic window. So maybe just comment on how do you think you're differentiated and what's your plan for development.

So on the first question regarding sitra, Ben, could you please provide your color? And then the second question regarding the [ Seattle ] CD70, Lai, could you please share a bit of your thought?

Yes. I probably can take the first one. I probably defer the second one to be Lai, if that's okay. So there are 2 main differences regarding the -- our study design versus Mirati's Phase III SAPPHIRE study. So the Phase III SAPPHIRE setting is including both squamous and non-squamous versus only in the SAPPHIRE study. The second difference the combination in terms of PD-1 [ apparently ] our studies combining with Tisle, and SAPPHIRE study combines with nivolumab.

Yes. Related to the CD70, this is a program we are collaborating with Seattle Genetics. It's an ADCC-enhanced version. So this molecule is still in the Phase I dose escalation phase. We have the Asia. I think as Asia ex Japan plus Australia and New Zealand, right? So we're waiting for some early data from Seattle Genetics, then we can work with them to get into the dose expansion cohorts. So that's the current status. And I can tell you early data looks quite promising.

Our next question comes from [indiscernible].

So I just want to ask a little bit more about the new modality Lai has talked about. So I want to understand a little bit about the strategy or rationale behind it when we're looking for a new modality to develop, how do we think about different areas to get into? And then also among those new modalities, which ones are we most excited about? And when we can expect some clinical data.

Yes, Lai, please take the question.

Yes, I'll probably take that question. Yes. Thanks for the question. So as I highlighted earlier, I think one of the key things -- there's 2 things we're really looking forward to have the new modality to help us to address, one, is potentially to be able to hit on targets previously was considered undruggable. And the second part of it is we do believe with the evolvement of the new technology. You want to be more specific here. We'll talk about being more tumor-specific. So many of our new modality is around can have a precision tumor delivery of the particular therapeutics. In terms of drug and undruggable, we certainly believe the CDAC platform provides the opportunity to work on many targets, which were previously really looking forward to work on. In terms of the question related to which one I'm most excited about, I'm excited about all of them, that really -- that we have so many different programs we are cooking. And you have seen a little sneak peek of what we show you today is our first, a CDAC program. That's a BTK CDAC. So if you talk on new modality, that's probably the one you will be able to see that data the quickest because also the data to show in for that molecule is probably going to be relatively quick. And maybe I just want to add 1 more point about why we are working on the BTK CDAC. I do believe that BTK resistance is way more than just the system mutations. And from our own study with our zanubrutinib in the clinic, we have observed additional mutations, which seems like its function as a scaffold function. And with the BTK inhibitor, you cannot remove the traditional BTK kinase inhibitor, you cannot remove those scaffold function. And the BTK CDAC will be able to degrade the -- remove the BTK protein, therefore, diminishing those scaffolding functions. So I think that will be very exciting. But behind that, you're going to see a whole bunch of other new modalities getting to connect in the next 1 or 2 years.

Maybe just a quick follow-up. On the new modalities, how do we think about the [ MRA ] platform and also maybe some gene therapies? Do we have interest in those areas? And how do we think about our strategy in developing those areas?

Yes. Actually, in half the slide we have about our preclinical pipeline, yes, a symbol stem for [ MRA ]. So we are definitely investing into the [ MRA ]. It's just today, there's the time limitation, I didn't get a chance to talk about it. Certainly, there has been tremendous interest in [ MRA ]. But we like what we have done in the past, we just don't want -- we don't want to simply just dive into technology because it's hot. We want to make sure we have the knowledge, understanding and the know-how to differentiate. In BeiGene, even though CAR-T was extremely hot for already probably close to a decade now, but we never really invested in CAR-T, especially the autologous CAR-T, we didn't feel like there was a way to be able to make medicine with enough safety and also the cost advantage. But in terms of [ MRA ] certainly there's a lot of interest. In gene therapy, we haven't started on that product, but we're looking to that. But in addition to [ MRA ] gene therapy, we're also talking to many other different therapeutic modalities. We'll keep our eye open. As I mentioned, I truly believe biotechnology is now going through a transformative arrow. If you are not following the technology, you could easily be left behind.

Our next question comes from Matthew Harrison.

Great. Appreciate you doing this. I was just wondering if you could comment more on the HER2 molecule and what you see as sort of the path to registration for that molecule and how we should be focused on maybe some upcoming data sets for that.

Thank you, Matthew. Ben, do you want to get us started on this one?

Sure. As briefly mentioned, there are 2 pivotal trials, one has started in second, third-line track last year. So we are expecting the data, hopefully, in the near future. The second one is the first-line gastric in combination with the Tisle in first-line chemo. So that's about to start later this year in collaboration with Zymeworks. Did I answer your question?

You did.