CytomX Therapeutics, Inc. (CTMX) Earnings Call Transcript & Summary

Thank you. Thank you. Great afternoon everybody. We're pleased to have CytomX Therapeutics with us for the next fireside.

Chris, I'm going to turn it over to you to maybe make some opening comments, and then we can jump into it.

Yes, hi, everyone, and thank you, Matthew, and the Morgan Stanley team for inviting us this year. Chris Ogden, Chief Financial Officer of CytomX Therapeutics. Just before starting, I will be making forward-looking statements, so I'll refer you to SEC filings for those disclosures. Just to start, CytomX Therapeutics is an oncology-focused company. And really, we refer to CytomX Therapeutics as the original masking company. We really invented the field of masked biologics. And what we mean by masking is we essentially have a technology where we can limit binding. We designed to limit binding of target biologic formats in healthy tissue, but activate those therapeutics preferentially in tumor cells. So what that allows us to do from a design perspective is to really go after targets that other companies can't drug. And so from our perspective, that's led to clinical programs that are highly differentiated and are really enabled by our technology. More of those, but our two clinical programs: one is an ADC for colorectal cancer, the principal indication. The other is a cytokine program focused in melanoma. So I think we'll talk much more about those, but that's really the focus of the company.

Perfect. Wonderful. So maybe two sort of overarching questions, and then we can obviously get into Vercirnon, which is the program that I think people are focused on. But the first one is, right, so the target for Vercirnon is EpCAM. You know, as you talked about, masking is important there because that target is pretty widely expressed. So can you just talk a little bit about that, how you've designed this agent to be able to hit that target, and just a little bit of history in the field, because others have obviously tried this target, why you think you're seeing a different result.

Yes, I mean, first and foremost for the target, so EpCAM, epithelial cell adhesion molecule, was really discovered as a CRC cancer antigen quite some time ago. The reason it was discovered a couple of decades ago is it's just so highly abundant in tumor cells that it really pops out as, you know, potentially an ideal target for a colorectal cancer therapy. To your point, it's been attempted to be drugged before in monoclonal antibodies; there's been T-cell engager formats, and they've all run into toxicity due to expression, presumably, in non-tumor tissues. And so the toxicities that have really limited therapies before are pancreatitis. So all the first antibodies saw pancreatitis quite early in dose finding, and also liver tox was a challenge. GI has also been something that's confronted. We'll talk more about, but I believe we have a therapeutic window in that context as well. In terms of our design, we've been, I would say, it really starts with the end in mind. So first, we thought this target, if you can create a therapeutic window, make a big difference in colorectal cancer. And so from that perspective, we went about designing the other components of the drug and including the payload, which was developed and licensed from ImmunoGen, but we did have a former program with the maytansine payload that actually we could have advanced on a faster timeline, but we made the choice to switch out that payload with a TOP1 payload because that mechanism is known to be active in colorectal cancer. Irinotecan, which is a TOP1 inhibitor, is a key part of standard of care in CRC. And so the design, including EpCAM as a great target that we can unlock through masking, paired with a TOP1 payload for CRC, is really been the focus of this program, and we think all the components really lined up for us to make a difference here in CRC with our technology and this target.

Any other thing you would highlight from a design standpoint, DAR, or any of the other factors that have been important as you think about therapeutic window here?

Yes, I mean, I would say when we did the work, going back, you know, today with ImmunoGen, it is a DAR-8 ADC. And we benchmarked the payload to Enhertu, the payload on in HER2. So in terms of the design and the preclinical work, we thought about this is really Enhertu for EpCAM. That was the design principles. And so when you think about the payload potency and those types of things, potential bystander effect, those are all benchmarked to Enhertu, which was emerging at that time as a best-in-class ADC and has proven to be.

Perfect. So why don't we talk a little bit about where you are with Vercirnon, and then we can obviously talk about where you're going. Maybe first thing, you know, the sort of initial market where you've started to get some data, right, is in a third-line plus patient population. Outcomes are pretty poor for those patients. But maybe just so we're all on the same page, what's available right now? What sort of standard of care for third-line? And what does that look like?

Yeah, no, it's an important question. Before doing that, I do want to just zoom out. Most investors and people in the audience will appreciate this, but when we think about the context of colorectal cancer, the way we think about it at the company is, it's one of the, if not the most, urgent health crises in oncology. It's the second leading cause of death in the U.S. It's the leading cause of death in patients under 50. And as you've seen in the news, growing at an alarming rate. And so when we think about our place in the industry and the chance to make a difference there, I think that perspective will be highlighted in how we're thinking about the initial development and how much unmet need there is for these patients. To your question in the context of third-line plus, first of all, I would just say it's, unfortunately, a big market. And so we think in the U.S. there's about 35,000 to 40,000 patients that progress to third-line or later colorectal cancer. If you look at the benchmarks in the latest line, which are single-agent TKIs for the most part, response rates are 1% to 2%, progression-free survival, so the amount of time a patient stays on therapy without the tumor growing, is only a few months, and unfortunately their overall survival is 6 to 7 months. And so, in the context of that pretty poor set of outcomes, we've been very pleased with what we've seen with Vercirnon and the chance to make a difference. So our patient population has been really fourth-line or later, you know, the clinical study population has been. So, we're getting, you know, very sick patients. What we've observed over the course of Phase 1, or the last couple years, is response rates in the 20% to 30% range. Again, that compares to 1% to 2% for benchmarks, and our estimated progression-free survival, excuse me, of 6 to 7 months, again, comparing to just a few months in standard of care. And we've not reported overall survival, but that is something, now that we've been in the clinic for a couple of years, we do expect to have initial reads on later this year. And so just getting back to how important this category and need is, I think the data we have really underscore how much urgency we have to progress this to late-phase development.

So as part of that data package, obviously, there's a focus both on efficacy and tolerability, and sort of highlighted this a little bit at the beginning. GI tolerability is probably the key focus from a tolerability standpoint. What have you seen so far? And you've obviously done some things in terms of dose optimization, etc., that you're thinking about to try and improve that tolerability. Can you just walk through sort of what the thinking's been and where you think you're going to end up from a tolerability standpoint?

Yes, so GI toxicity has been the key adverse event that popped out in the Phase 1 work, in particular diarrhea. So over the course of Phase 1, we've seen grade 3 diarrhea rates that can exceed 20% at the higher doses, in the 30% range for grade 3. So as this observation has been understood, a few things we've been focused on. One, we have instituted prophylaxis to try to minimize the number of patients who get in the grade 3. And we've optimized that prophylaxis over the course of the Phase 1 study, and it includes dual prophylaxis with loperamide, which is an anti-motility agent, and then budesonide, which is an orally absorbed steroid in the GI tract. And we're looking at, we were encouraged in our data update we provided in March that we had initial data after a couple of months of follow-up, where the grade 3 diarrhea rate was 10% compared to about 30%, which we had seen with non-prophylaxis in the early part of the study. So, 2 months of follow-ups was a good start. We'll continue to follow up on those data, including with additional patients enrolled and more follow-up time. And so, we're looking to continue to manage that rate of grade 3 diarrhea between 10% and 20%. We really think, based on the work we've done with physicians and thought leaders, that that'll be a, you know, attractive risk-benefit in the context of the efficacy we're providing. The other thing we've implemented really to fine-tune the exposure delivered to the drug is we've begun dosing patients based on adjusted ideal body weight, which really normalizes for patients with higher BMI, based on the observation that some patients with high BMI were seeing outlier levels of exposure, and we provided some data on C-Max and PK in our presentation. And those patients, some of them had more challenges with GI. So we think tightening the exposure range and the outliers may help in those patients with high BMI, and then the prophylaxis is an additional measure. So we feel like we're making good progress and we'll have additional data following that up.

later this year. And I think, you know, one of the questions probably people focus on here is obviously the efficacy data that you've reported from multiple scans of patients, and you have a good sense of that. The safety data where you've changed sort of the dose regimen is early, and so we don't have the efficacy from those patients. Can you just talk about why you're confident about maintaining the efficacy that we've seen with this sort of newer dosing regimen?

Yeah, I mean, I think the, you know, big picture, what we've seen across the Phase 1 study to date suggests that Vercirnon is active in late-line CRC, you know, and across the 8.6 and 10 dose range, which was dosed at actual body weight, we're seeing response rates in PFS where we think there's room to operate. And so I think overall our view is the drug's behaving fairly consistently across this dose range. And so really this is about optimizing the therapeutic window within a compelling overall profile that we've seen to date and, of course, we need to see that data through and see what we get, but that's, you know, the view based on the steps taken today.

Okay, perfect. So from a next step standpoint, I think there are two things going on. So one, I think you've committed to sort of talking about what a registration program may look like here. And then the second is obviously you have these optimized dose cohorts ongoing. Can you just talk a little bit about timing for when we might expect to hear from you, what that additional data is, and then what the registration path may look like?

Yes, and it really starts with the latter, where the focus of the company around dose optimization is getting to dose selection, including discussions with FDA around Project Optimus and making sure they're comfortable around wherever dose is chosen. And so, and then that decision, obviously, in conjunction with, based on the totality of our data, what's the first monotherapy registration study? Again, just given the unmet need in late-line, we think it's absolutely critical to get Vercirnon into late-phase development. And so the context for all the data that's being generated is to make the dose and registrational decision. We will communicate those next steps and the data that underpins it. That's really how we're thinking about it and we think also most helpful to investors. And all of that. Well, that's our base plan.

Yes, of course, in the case. And so just to be clear, we should expect to get all of that at the same time, is what you're saying.

context of things like FDA interactions we need to make sure those things stay on track, but that our base plan is to provide next steps and data, you know.

together. And can you talk a little bit about, you know, obviously you don't know what that is yet, but can you give people a sense of sort of what the guardrails of that may look like, right? I mean, is this going to be a, you know, should people be thinking fourth-line only? Can there be a possibility to include earlier patients or, you know, a third-line? You know, combinations or what should people be thinking about here in terms of, you know, what the guardrails look like for the first study? Yes. Yes.

We haven't made any decisions. I mean, for the first study for monotherapy, I would first say that our basic expectation is we do expect the initial study will be a randomized study with an overall survival endpoint. There aren't a lot of precedents for, for example, single-arm studies. And so with that context, we're looking at, we're likely looking at either a monotherapy study in the late-line, which would include comparators such as Fruquintinib, Regorafenib, maybe single-agent Lonsurf. Or the third-line, which is a combination, the standard of care is a combination, Bevacizumab and Lonsurf. So we haven't made any decision on which. We think both are attractive from an unmet need and market uptake perspective, most likely. And in any case, this is a first step. And to your point on combinations, yes, in parallel, we've kicked off combination work with Bevacizumab, which could unlock third- or second-line as we move up the treatment paradigm. And then also in the fourth quarter, we plan to start combination with Vercirnon, Bevacizumab, and 5-FU, which is really our strategy to replace irinotecan in the FOLFIRI plus Bevacizumab regimen, which could unlock second-line. And then that regimen is also used in first-line, and so those things are all, you know, underway. And so in any case the first step at monotherapy is just that. In our view and in this drug has potential in multiple lines of therapy.

Can you just talk a little bit about how you think about market opportunity here? I know you talked about 40,000 patients. You know, if you do have a third-line label versus a fourth-line label, like how does that change your thinking at all?