Celldex Therapeutics, Inc. (CLDX) Earnings Call Transcript & Summary

All right. Good afternoon, everyone. Thanks for joining us here at the SVB Leerink Global Healthcare Conference. My name is Tom Smith, I'm a senior biotech analyst here at SVB Leerink. And happy to be hosting this next fireside chat with Celldex Therapeutics, where we're joined by CEO, Anthony Marucci, CFO; Tibor Keler; and CMO, Diane Young. Thank you all for joining us. Just one quick housekeeping note here before we get started for investors joining us on the webcast, feel free to submit any questions for the Celldex team in the webcast portal or e-mail them to me directly at [email protected]. And with that, Anthony, it would be great if you could take us off with just a brief overview of the company for those in the audience who may be less familiar with the story.

Yes, happy to, Tom. But before we do that, obviously, I need to make the disclosure to the audience today that we will be making some forward-looking statements and that we would refer everyone to our SEC filings where we discuss those in more detail. So for those of the people on the call that are less familiar with us, we are a publicly traded immunotherapy company. Our focus historically that's been on human monoclonal antibodies and bispecific development. therapeutic areas that we work in are in the immuno-inflammatory space as well as the immuno-oncology. Our recent data over the last year has been focused on the 0159 program, where we've had some excellent data in the chronic inducible urticaria. And we're looking forward to our Phase Ib data in chronic spontaneous urticaria later this year. And certainly, the pipeline is expanding now. Late last year, we entered into our third indication in prurigo nodularis. And on our year-end call, which we believe is going to be on February 28 after the market close, we'll talk about our fourth indication as well as some subcu healthy volunteer data that we have to discuss. The company is well capitalized. We had several raises in 2020 and again in 2021. So we feel that we have enough cash to get us through 2025 and to complete all the clinical trials that we will be working on this year. So 2022 is obviously going to be a very busy year for us, not only starting Phase II studies and additional Phase Ibs but also getting data from our Phase Ib and CSU, which we hope to present at EAACI later on this year. So that's the quick rundown.

Okay. Perfect. Great overview. And yes, certainly, a number of upcoming data points, I know investors are going to be keenly tuned into. I want to start with a little bit of background on CDX-0159. And maybe if you could just walk through a little bit of the development history here. We know you had a predecessor compound CDX-0158. Can you talk about some of the work that was done, I guess, with the predecessor compound and then some of the changes that you made to end up with 159 to push that forward in autoimmune disease?

Sure. Yes. So I can take that. So CDX-0158 is a molecule or an antibody that we acquired with the acquisition of Kolltan Pharmaceuticals. And it was discovered, there was a highly potent inhibitor of KIT signaling and KIT is obviously a very important molecule for mast cell survival and function. That particular antibody was investigated in a Phase I trial of GIST cancer patients in a dose escalation study. That study did not demonstrate any clinical benefit, unfortunately, and at least our interpretation there is because the mutations in the KIT receptor that are commonly expressed in just tumors often induce the internalization of that receptor, and it's no longer require a stem cell factor interaction to drive KIT signaling. So what we did subsequent to that study to help improve CDX-0158 because one of the other outcomes in the study was to recognize severe infusion reactions that were occurring on what we believe is through mast cell degranulation occurring through the Fc domain of the antibody interacting with Fc receptors on the mast cells. And so we did some engineering, one set of mutations was engineered into the Fc domain to eliminate binding to Fc gamma receptors and prevent that -- or greatly reduce the ability to activate mast cell degranulation. And at the same time, we introduced additional mutations that would improve the relatively poor half-life that was observed with 0158. So that's essentially what we've done with 0159. And of course, the clinical studies have borne out that those mutations actually had the impact that we wanted.

Yes, great. That's helpful. And I guess just thinking about -- I mean, you mentioned some of the impacts of KIT inhibitions. I mean we know on target impacts from mitogenesis impacts hair color, impact hematopoiesis. I guess if you could just walk through some of the changes that you've seen clinically? And then also, I mean, one of the other questions I hear frequently from folks specifically as it relates to this spermatogenesis, it's just around some of the preclinical work that you're doing to characterize some of that genotox. Just what's the latest in terms of where you are with the preclinical studies?

Sure. Well, we have observed some effects of Kit inhibition on other cells. We see, obviously, a small impact on hematopoiesis, which has not shown to be clinically significant. We have had some patients comment on some lightening of hair in certain patches. This has been well described for other KIT inhibitors. So overall, we don't think what we've observed so far is in any way clinically limiting our development. And from a preclinical perspective, we are conducting a number of studies currently during the 6-month chronic toxicology study, which is required to support our Phase II trials that is being done in mature animals, which will give us an opportunity to assess some effects on reproductive toxicology, including spermatogenesis. So we'll be having some of that data this year. Additional reproductive toxicologies as required by FDA guidelines will be performed over the next couple of years to further support and identify any potential hazards.

Okay. And so we should expect an update and, I guess, visibility into kind of the progress within those studies at some point in '22? Is it fair to say kind of mid '22? Help us understand this, timing-wise.

Well, certainly, the analysis from the 6-month chronic tox study is required to support the longer-term dosing in our Phase II trials, which we anticipate initiating in the first half of this year. So there will be at least visibility into the ability of us to move forward into those studies with that. These studies also involve a longer-term follow-up, what's called recovery period for any findings that you see to determine whether or not they are reversible. And based on all the information and biology that's been reported on this potential mechanisms, we certainly expect any findings we have to be fully reversible. So that data won't come until later this year.

Okay. Understood. Yes, that's helpful. And then just maybe lastly on the mechanism. I mean, and I'm asked this frequently from investors as well, just help put CDX-0159 into context versus some of the other CD117 targeted antibodies in the clinic from the likes of Jasper and Magenta.

Yes. As you said, I think they're quite different in their approach. They are conditioning -- they are going after the ability as a conditioning agent where their intention is actually to deplete stem cells. The Magenta antibody, as I understand, is an antibody drug conjugate where they're delivering a toxin and is very effective at depleting stem cells. In the case of Jasper, is more similar to the Celldex approach with an antibody that targets the stem cell factor binding area on the kit receptor and is very potent at blocking that receptor. We don't understand fully why they see greater effects on hematopoiesis than we've observed with 0159, but it could be nuances in terms of the mechanism between these 2 antibodies.

Okay. Okay. That's helpful. Maybe we can turn to some of the exciting clinical data that you've generated in inducible urticaria. And I mean, as follows, dose ranging in healthy volunteers, single dose in healthy volunteers, but the data that you reported last year in inducible urticaria, extremely impressive efficacy. Maybe you could just walk us through kind of the high-level results there and how they compare versus pretty much any of the other inducible urticaria data sets or urticaria and general data sets that we've seen to date.

Sure. So in the study that was presented last summer, it's a study in inducible urticaria looking at the 2 most common forms of inducible urticaria, which are cold contact urticaria and symptomatic dermographism. And in that study, we gave the patients a single dose of CDX-0159 at 3 milligrams per kilogram. And we measured the response by the ability to induce hives with provocation tests. So there's something called the TempTest, which we used for colder urticaria and the FricTest for symptomatic dermographism. And we saw that with just a single dose, we had -- 100% of the patients had a response and 95% of the patients had complete response, meaning that you could not induce their hives with those tools. And the responses were very rapid. They occurred within 1 to 4 weeks for most patients, and they were also durable. They lasted throughout most of the 12-week follow-up period. And then in addition to those provocation tests, we looked at some measures of the patient's quality of life and their urticaria control and those also reduced. And very importantly, we have a biomarker, which is trip days, which was -- is thought to reflect mast cell burden in the body, we saw profound reductions in trip days as we had in our healthy volunteer study. And we saw in skin biopsies that we depleted mast cells. So it was very exciting to see this full proof of principle and everything kind of come together in the one study. So I would say comparing it to other agents, there are no approved agents in CIndU, beyond antihistamines. There had been some pilot studies with XOLAIR in symptomatic dermographism and cold urticaria. They were done basically at the same center that we did our study with the same tools. And in those cases, they showed some, more like a 50% complete response rate in terms of the provocation tests, and it was -- it took longer to get there. They were measuring their response at 10 weeks and send [indiscernible] as we saw. There is also some data with -- some early data with the [ Aligos compound ] in symptomatic dermographism and on their FricTest results, they had about 50% response rate. So it really -- really great response rate in that study.

Yes. No, it certainly helps put it in the context, really stellar efficacy results. I guess as we think through kind of the pathophysiology here and the pathogenesis of urticaria, I mean, is there any mechanistic reason or other rationale for thinking that the inducible urticaria results wouldn't translate into chronic urticaria?

Well, we think that all urticarias where the mast cell is really the primary cell driving it, there can be some individual -- there can be some differences in the disease. One difference between spontaneous and inducible urticaria is that for inducible, we have the FricTest and the TempTest which you actually induce the hives and it's kind of an objective measure. chronic spontaneous urticaria can kind of [indiscernible] bit. So patients can -- there's some level of patients improving or getting worse on their own. And the other thing is that the endpoint that we're measuring for chronic spontaneous urticaria is a patient-reported outcome tool. It's the urticaria activity score and often with tools where patients are reporting, there's more variability. But we do expect that we will have chronic spontaneous urticaria as all.

Okay. Okay. I guess thinking to kind of the safety tolerability side of the equation, within the CSU data set, you are doing some dose ranging, it's also your first multi-dose data set for 0159. Is there any reason to be concerned, I guess, by the mild and the transient asymptomatic decreases that you saw in hemoglobin and white blood cell parameters from the CIndU study or from the healthy volunteers?

Well, as Tibor mentioned here, we're following hematology very closely because it is a target of KIT, the hematopoietic stem cell. That being said, so far, everything has been mild and nothing clinically significant. We believe that we are saturating at the doses that we're at, and that's persisting for a long time. And so we don't think that subsequent doses are going to make anything worse in terms of any observation of hematologic parameters. And we have some evidence of that, both in our chronic tox studies, where we did not see listening of any hematologic parameters and also from the 0158 that Tibor described earlier, where we did treat patients every 3 weeks for doses up to 15 milligrams per kilogram, and we're able to deliver multiple cycles, including one patient that went out to 2 years and didn't have progressive hematologic issues.

Okay. So it's the combination of what you've seen preclinically meets, I guess, the experience with 158, where you did have at least one patient that was dosed out, pretty long duration of dosing. And if I recall correctly, a pretty high dose relative to what you're exploring for 159. I guess kind of difficult to compare data sets there in the sense that 158 wasn't a GIST patient population or oncology patient population. But did you see -- I mean, I guess, across kind of any of the patients enrolled in those studies like were there clinically relevant changes in heme parameters that were deemed possibly related to drug?

There was nothing clinically significant. As you mentioned, being just patients, they may have had other therapies that may have compromised their bone marrow but we definitely did not see any clear of anything due to chronic dosing in that study related to hematologic parameters.

Okay. Okay. I appreciate that. And we do have an inbound question here from an investor. I'm going to paraphrase a little bit. But basically, just asking Tibor, if you could elaborate a bit on the differences between 159 and the Jasper compound and why there might be a difference in stem cell depletion or hematologic tox based on what's known between the 2 compounds.

Yes. Well, we don't have any definitive data. What we know is that the mechanism by which they inhibit KIT signaling is slightly different. The Jasper antibody as I mentioned, binds to the KIT receptor at the same place that stem cell factor binds and that's its mechanism of blocking stem cell factor mediated signaling. There's a unique mechanism around 0159 that binds to the KIT receptor in a way to prevent its dimerization and therefore, KIT -- stem cell factor has real significant issues with being able to bind because stem cell factor needs to dimerize itself in order to be able to bind to 2 KIT receptors and induce the signaling. So there are differences by which these antibodies work that may be partially responsible for differences that we're observing in regards to effects on bone marrow.

Okay. Okay. Yes, that's helpful. And then I want to turn to, I guess, expectations for the upcoming data at EAACI. You've mentioned -- I mean you now have a cholinergic inducible urticaria cohort. I think we're also expecting that at EAACI, but it seems clear to me that the focus will be on the multi-dose CSU data. What are your expectations, and I guess, help investors kind of think about where expectations should be ahead of that data set.

Yes. So we -- yes, so we've said that we're planning to submit data to EAACI. We haven't really guided around the details, but we're planning to present those robust data set as possible.

Okay. Okay. Can we talk a little bit about, I think, I mean, one of the surprising developments in the urticaria field over the last 6 months or so, it was the failure of Novartis' ligelizumab. Maybe if you could talk a little bit about the approach there and it's speculation, right? We haven't seen the details, but where, I guess, you think ligelizumab may have fell in terms of efficacy?

Yes. So it's hard to say because we haven't seen the data. I think that, that study was set up so that their success criteria was that ligelizumab had to do better than XOLAIR. From what we understand, it did do better than placebo, but they had actually set the study up based on a Phase II study and selected their dose based on trying to pick something that would be better than XOLAIR. So I think we're really interested to see the data and see what happened there. Was it something about the patient population, what went on. But I think that's the main thing that we're interested in. And they have said they're going to show the data later in the year, so we're going to have a look at it.

Yes. Okay. Yes, we'll certainly be on the lookout for that. I want to talk a little bit about 159 in prurigo nodularis, which is the most recent indication expansion and you've kicked off a study there. I guess kind of walk us through the rationale, like why prurigo nodularis as the next indication up and talk about, I guess, what we can expect to see from the proof-of-concept study and any sense of timing in terms of data?

Yes. So prurigo nodularis came out of a similar process to what we've gone through with all our indications, which is that we do this very in-depth analysis, and we look at the data about whether -- how -- whether mast cells are implicated in the disease. Is it an unmet medical need? Is there a regulatory path that we can foresee and then the commercial potential? So prurigo nodularis, there's some interesting recent data suggesting that mast cells and sensory neurons interact to really severe [indiscernible] associated with prurigo nodularis. And so this was really interesting to us to pursue. And then it is an unmet medical need. There is nothing approved for it. It's really a devastating disease. And the other thing that we liked about it was that if we can show that we reduce it and heal the lesions of prurigo nodularis, we have the potential to go after other diseases where neuroinflammation is an important mechanism. So that led us to start our study, which initiated in December. The study is a placebo-controlled study looking at 3 doses of CDX-0159 with -- and we're really looking at itch as the primary endpoint with the worst stage [indiscernible]. And we're also looking at the lesions, which takes longer than itch because there's a lot of healing has to go on. And we haven't really -- we haven't definitely decided when we're going to present, but we would really hope to have some results by the end of the year.

Okay. Okay. That's great. Okay. Let's talk a little bit about kind of next steps for 0159. And Anthony, you alluded to naming another indication here in the relative near term. I guess strategically, help us understand how you think about the indication expansion. I mean you're thinking about kind of the broad spectrum of mast cell-driven diseases. But what goes into that evaluation process and yes, just help us think through kind of the strategic...

Yes. I think Diane has touched on it already. I mean so we look at 3 buckets, the science, the clinical abilities and then the commercial opportunities. So we're looking at unmet need, we're looking at the role of the mast cell, whether it plays a contributory or a vital role in the disease. Then we're looking at feasibility and conducting clinical trials as well as what's the possibility of success in those trials? And then lastly, we look at the market opportunity around that. And collectively, we score them and we make a decision to move forward. So CSU obviously admit the high unmet need and met the mechanism of action, visibility -- feasibility to do the studies and so far so good, with the probability of success. We've been successful in the CIndU. And then we think that the market is there. And then the same thing with PN. We think the market is a bit smaller but it could be larger as you expand the ability to treat patients with a biologic. And then the next indication will be the same thing. So that's how we look at them in general.

Okay. Great. Yes. That's helpful. I also want to ask about how you're thinking about the dosing going forward. Obviously, the CSU study is doing some dose ranging. We're looking at Q4 week and Q8-week dosing. You also recently added a cohort to the CIndU study, looking at single doses of 1.5 mg per kg. Just how are you thinking about dose evaluation here? And is there any possibility of exploring even less frequent dosing, perhaps Q12 week dosing intervals.

Yes. So I guess the most important thing is that we're planning to move to subcutaneous dosing in the future. So we do have a highly voluntary subcutaneous dosing study that we will be voting on at our upcoming call. But I think it's very nice that we also have tryptase as a biomarker. So that's going to help us look and compare what we've seen with intravenous dosing and subcutaneous dosing. So right now, we're thinking that for the urticaria studies that we're planning, we are going to have to do dose ranging in Phase II. And so we're going to look at several doses and schedules, and we're trying to find a dosing schedule that will to allow the patients to have controlled their urticaria over the whole dosing period, but also be [indiscernible] as conveniently as possible to the patients. And so whether we can go to 12-week dosing and is also a function of how high a dose we could get because with subcutaneous dosing you don't want to have to give too much of a volume to the patient because it'll be uncomfortable. So we're putting all those things together as we gather the data but we do expect to be able to dose given the long [indiscernible] that have we expected or at least at a minimum going to be every month or every 8 weeks.

Okay. Yes, that's great. And yes, we'll be tuned in for the initial healthy volunteer data for the subcutaneous dosing. Can you just remind us on the, I guess, the formulation there. How was it formulated, the concentration?

It's formulated at 150 mgs per ml.

Okay. Okay. Okay. And then just remind us how you're planning to incorporate the subcutaneous formulation into the broader clinical program?

So we're going to start using the subcutaneous formulation in the Phase II studies. We envision that for most of the indications we're looking at the subcutaneous dosing will be the preferred method. So we're going to start incorporating that.

Okay. Okay. And maybe just in the -- I know we're up against time a little bit, but I did want to touch on the oncology program. Maybe just a brief update on the oncology assets, CDX-1140. And when we can expect to see the next data update there?

This is well -- yes, CDX-1140, we're -- it's in the Phase I study. We are currently doing cohorts in combination with camrelizumab, and we have some -- we reported in November. We have some encouraging early data in head and neck cancer. So we're -- right now, we're waiting to accrue those cohorts, and then we'll present that data.

Okay. Excellent. And that is this year, update, probably, maybe second half?

Yes, definitely be in the second half.

Okay. Understood. All right, guys. Well, unfortunately, we're up against time, but really appreciate you joining us. Thank you for the updates and the insights, and thank you to the audience as well for joining us, and we'll stay tuned. Certainly, a number of exciting data points on the very near-term horizon.

Yes. Great, Tom. Thank you for having us. We appreciate it.

Thank you.