Genmab A/S (GMAB) Earnings Call Transcript & Summary

Good morning. I'm James Gordon, JPMorgan European pharma and biotech analyst. And today, I've got the pleasure of introducing the Genmab presentation. And we're going to hear from Genmab's CEO, Jan van Winkel. Thanks very much for joining us today, Jan, and look forward to the presentation.

Thanks, James. It's a real pleasure to once again, at the JPMorgan conference in 2024, give a presentation on our company. The slides of today's presentation will be available for download on our website immediately after the event. So let's get started. The presentation may contain forward-looking statements, and as such, may contain certain risks and uncertainties. I'm sure you're all familiar with that. Over a more than 20-year history, we have had a laser sharp focus on harnessing the power of human antibodies to develop differentiated antibody therapeutics. Behind that focus is an unstoppable team and the core purpose, which guides our work, an extremely successful strategy and an inspirational and ambitious vision for the company. Following the approval of our second product in 2023, we have never been in a better position to achieve our inspirational vision. We have a consistent and solid track record of success, which you can see here on the left. The success is supported by an extremely strong financials that allow us to invest in growth opportunities. And taken together, we have built a solid foundation that has supported our evolution into a fully integrated biotech innovation powerhouse. Our successes have been possible because of what makes us unique. We firmly believe in the natural ability of the immune system to fight against disease. And we use our deep understanding of disease mechanisms, targets and antibody biology to invent proprietary technologies. This in-house expertise is met with strategic partnerships that help us to take our products further than we can do on our own, and give us access to high quality and unique disease targets and additional cutting-edge technologies that can be combined with our own. We leverage a combination of cutting-edge scientific capabilities and innovative scientific approach, our expertise in translational research and strategic partnerships to create a robust pipeline of potentially first-in-class or best-in-class products. So here is a summary of our innovative clinical pipeline as it exists today. In green on the top, our 9 products or product candidates with at least 50% ownership of Genmab. And this number will move to 11 very quickly, once our next programs with BioNTech, GEN1059 and GEN1055 enter the clinic in the coming months. Most programs either are or have the potential to be first-in-class or best-in-class, including our 2 approved medicines, EPKINLY and TIVDAK, and I will describe them later. In blue, you will see multiple programs being developed by partners that were either created by Genmab or via our proprietary DuoBody technology. There's no cost for us for these programs. And once approved, they provide us with recurring royalty revenue. Thinking about that recurring revenue, let's take a moment to look at the high quality and the power of our discovery engine that you believe sets us up very well for the long term. First, we have 8 approved medicines, as you can see in the box on the right, that are part of our innovation and technology and are currently generating revenue for us. The top 3 are already blockbusters. The remaining 5 have meaningful growth profiles and have the potential to become blockbusters or mega blockbusters. I can say this with confidence because we have the clinical development plans in place and with our partners, we are investing to make this happen. The 6 royalty-generating products are marketed by pharma and biotech powerhouses, J&J, Novartis and Amgen and our 2 proprietary products are co-marketed with AbbVie and Pfizer. And they are both concerned potential blockbusters. So we are confident that we will realize this potential, especially with AbbVie and Pfizer on our sites. So now let's turn on to the power of a highly productive R&D engine. Of around the 40 programs we have moved in the clinic -- to the clinic, as I noted, 8 are already approved and 19 are in active clinical development as we speak. There's a high level of success compared to peers, and this is no accident. We understood very early on that the competitive advantage of our deep [ dive ] antibody science and focused discovery engine could provide. So we have invested more in discovery to increase the number and quality of our product candidates. This includes investment into our proprietary technologies, which we'll discuss on the next slides. And we also have access to a suite of other technologies to our partners. This unique position allows us to bring only the products with the best potential through to development. So -- and so deep insight into antibodies and our proprietary platforms that has helped us to discover, build and/or design the 8 products that are currently approved. If all 8 approved products would be wholly owned by Genmab, we would have generated estimated revenue in 2023 of around $14 billion. And as we move toward a model in the future where we have 100% ownership of our products, we believe that we continue this track record of success and further solidify our position as a biotech innovation powerhouse. So let's now take a look at our technologies. We believe that our diverse technology platforms are a key to our success. Genmab has 4 proprietary antibody technology platforms and during -- including DuoBody and HexaBody. They allow us to select the most appropriate modality from our toolbox to tackle a specific disease targets. And of the 8 approved medicines that are based on our innovations, half of them are Duobody-based bispecifics. One of these bispecifics is epcoritamab, which was approved in 2023, as EPKINLY in the U.S. and Japan and as Tepkinly in Europe and the U.K. The approval of epcoritamab, which we are codeveloping and co-commercializing with AbbVie was an incredibly important milestone for patients in need of new innovative treatment options administered subcutaneously. And as a reminder, Genmab is the commercial lead for EPKINLY in both the U.S. and in Japan. This is a first for our company. We are pleased with how the launch is progressing so far. But the current approvals are only the first step to potentially establishing epcoritamab as the core therapy across Diffuse B cell lymphoma, follicular lymphoma and beyond. In June, we announced positive top line results from the follicular lymphoma cohort of the Phase I/II EPCORE NHL-1 trial. The data supported 2 exciting regulatory actions last year. The FDA has granted breakthrough therapy designation for epcoritamab for adult relapsed or refractory follicular lymphoma after 2 or more lines of systemic therapy. And the EMA has validated a type 2 variation application for epcoritamab in the same indication. And together with AbbVie, we are advancing a robust clinical development program for epcoritamab across B-cell malignancies. In addition to the data in follicular lymphoma, you can also see this in the multiple Phase III studies currently in the planning and that we anticipate will be initiated in this year. So let's move to the next slide for a brief look at the broad clinical development program for epcoritamab. Together with AbbVie, we have an ambitious vision for development of epcoritamab. In 2023, we have 3 ongoing Phase III studies, which you could see here on the slide. For '24, we aim to potentially double that number with the addition of new trials that you see here highlighted in purple. These include a new frontline study in follicular lymphoma as well as additional Phase III trials in relapse of a refractory Diffuse large B-cell lymphoma. And the encouraging data we have seen so far, including the data presented at the 2023 ASH conference in December, further support epcoritamab's combinability and highlight its potential to move into these earlier lines of therapy. The first Genmab medicine on the market was TIVDAK, which we are codeveloping and co-commercializing with Pfizer. The approval of TIVDAK in September 2021 introduced a critically needed treatment option for patients with advanced cervical cancer, with disease for progression on or after chemotherapy. And it represents a significant scientific advancements as the first and only ADC for treatment of -- in this patient population that was approved. With the positive results from both the confirmatory innovative TV 301 study in cervical cancer and the data in head and neck cancer from the innovative TV 207 study last year. TIVDAK has cleared a very high bar for continued investment and development, and we are very pleased with our plans to actively engage with health authorities on the next step for TIVDAK in both of these indications. And this week, we actually announced a [ week of ] priority review for the cervical cancer data released last year. So we are very excited about that, with a PDUFA date of May 9. This was press released yesterday. We are also investigating a number of promising investigational medicines in collaboration with BioNTech. The most advanced of these are the DuoBody-based bispecifics, acasunlimab, previously known as the GEN1046 and GEN1042. Both have the potential to be first-in-class in development for the treatment of solid tumors, and we are very excited about the data that we have seen so far. For acasunlimab, we are very pleased -- we were very pleased to announce in November last year that we have actually planned engagement with health authorities on the design of a pivotal trial in second-line non-small cell lung cancer, and that we would share the clinical data on which this decision was based on the medical conference in the first half of this year. In addition to maturing this program and also expanding it with the Phase II trial in endometrial cancer that was initiated last September. For GEN1042, we remain very encouraged by the clinical efficacy data we are seeing in multiple tumor types. And we anticipate that we will have the data. We need to determine next step for this program this year. The alliance of Genmab's expertise in antibody biology and development and biotechs immuno-oncology know-how creates a very powerful partnership. And we look forward to working together to advance all of our investigational medicines, including GEN1053, which is called HexaBody CD27 and next in the clinic in the coming time, GEN1059, which is standing for DuoBody-EpCAMx4-1BB. So the third 4-1BB targeted by specific program. And GEN1055 or HexaBody-OX40 and other Hexabody-based molecule. But it gets better. There are 3 additional Genmab-owned medicines in the clinic at this moment. First is GEN3014 or HexaBody-CD38, which we are developing in an exclusive worldwide license and option agreement with Janssen. GEN3014 was recognized at ASH in December last year, with a poster presentation on preliminary results from the expansion cohort at the recommended Phase II dose of the ongoing Phase I/II trial. We are actively enrolling now in the head-to-head trial with daratumumab, the gold standard in multiple myeloma, and we hope to have the data in the second half of this year. And we are very encouraged by what we are seeing. And as we have said previously, we anticipate the head-to-head data in the second half of '24. Looking at some of our earlier stage programs, the Phase I/II trial of GEN1047 or DuoBody-CD3xB7H4, is currently in the dose expansion phase. An important step in progressing our CD3-based bispecific platform in solid tumors. And GEN3017, our DuoBody-CD3xCD30, which you see here on the right, started recruitment for a first-in-human trial also last year. Our expanding and maturing pipeline is possible because of strategic investments in key areas: one, research. Building on a strong track record, we have actually have a state-of-the-art R&D facilities in both the Netherlands and in the U.S. And we continue to invest in new antibody technologies and next-generation therapeutic antibody formats, in addition to the 4 which we already have. Two, development. We are focusing on scaling up so that we can rapidly move from early to late-stage clinical development. We see significant potential to drive insights through data sciences. So we're investing very heavily in data sciences and an artificial intelligence right now. I believe that data science and real-time integration of translational research are key to accelerate product development in the future and to ensure the right therapies get to the right patients more effectively. And three, commercialization. We have a highly experienced team in place and now 2 successful launches with the approvals of EPKINLY and TIVDAK. Underpinning all of this is investment in key enabling functions to actually support growth and to manage risk. And this investment, we can do in part because of our strong recurring revenue streams from the 6 approved medicines that you see here on this slide. These medicines [ powering ] our technology and innovation, exemplify the commitment to applying world-class antibody expertise to create truly differentiated antibody therapeutics with the potential to fundamentally improve patients' lives. And the success of approved products also demonstrates the benefit of working collaboratively with strong partners, complementary with Genmab in terms of technologies, capabilities and knowledge across the whole innovation ecosystem of pharma, biotech and autotech and academia. 2024 is anticipated to become our 12th year of profitability, which is quite unique for a biotech company. The products on the market that we have discussed provide us with significant recurring revenue growth, and this growth lets us invest in our pipeline and our organization, allowing us to create significant long-term value and evolve for continued success. So this gives us a strong backbone of significant underlying profitability. In '23, Genmab made key strides towards meeting its 2030 vision, making for a transformative year in our company's history and our patient's care. But we are not resting on our laurels. 2024 is shaping up to be just as momentous, further establishing our independent destiny as a company and giving the people we help new ways to find disease. So now I will tell you how. We anticipate multiple approvals this year for epcoritamab. This DuoBody-based bispecific codeveloped with AbbVie, is Genmab's second company-owned product to hit the market, and we expect to receive European and U.S. approvals in follicular lymphoma in the second half of 2024. In the meantime, we look to file for approval in Japan in this indication in the first half of 2024. As I already mentioned, we will also make -- start of multiple Phase III trials with epcoritamab, with the goal of moving to earlier lines of therapy, and that's where we want to be. TIVDAK, our first company-owned therapy is ready to file with regulatory authorities in Europe and Japan for cervical cancer, in addition to the acceptance of the BLA this week in the U.S. And that will happen in the first half of this year, this filing. And we are engaging with health authorities and next steps in head and neck cancer. So we will broaden it from cervical cancer into other cancers now in the coming time. Promising data from GEN1046, now known as acasunlimab it's forthcoming in the first half of 2024, while we engage with health authorities planning for Phase III. Not far behind, we are eager to share data also for GEN1042 in 2024. This may include head and neck, and squamous and non-squamous cell lung cancer. As these programs -- as these programs progresses, we'll also be pushing forward with other promising programs, including data from GEN1047. You will see that data this year at a conference. Finally, we look forward to the highly anticipated results of the head to neck [indiscernible] trial or GEN3014. It gets a lot of attention right now versus DARZALEX FASPRO in the second half of this year. In summary, we have a laser-sharp strategy that will effectively drive us forward towards our 2030 vision. This vision will continue to act as our guiding light, anchored in our core purpose where we have the unstoppable team will improve the lives of patients through innovative and differentiated antibody therapeutics. Our first 2 Genmab-owned medicines on our own the markets, giving us a strong rationale to make focused investments to make the most of the opportunities ahead of us. And we will continue to be disciplined in our approach to this investment. We are confident that as we look to the future, we will see the realization of our continued evolution into a fully integrated biotech innovation powerhouse. We have never been in a better position to achieve our vision of transforming the lives of patients with cancer and other serious diseases. The best is yet to come. I think we are ready for Q&A, and I hope it will be lively and energizing.

Should I stay there?

Do you want to bring any other members of management with you or?

I mean Anthony is more welcome to join.

Thanks very much for the presentation. And does anyone have a question in the audience they'd like to start with? In that case, I'll start this off, which would be HexaBody CD-38. Just how differentiated do you think this asset is shaping up to be versus DARZALEX? And my question will be on a few parameters, how does it look, if we try and compare efficacy, but also, are there any concerns on tolerability? Is there potentially a tolerability challenge here.

So HexaBody CD-38 is preclinically at least tenfold more active than daratumumab. This is like a miracle. I mean, daratumumab is one of the most active antibody therapeutics I've seen in the last 30 years, which is one of the reasons that it's actually doing so well in multiple myeloma now, James. HexaBody CD-38 preclinically is at least tenfold more active in some cases, many, many for more active than daratumumab. That's a completely different mechanism of action. So we're now testing about basically in patients after an [indiscernible] and after a proteasome inhibitor. It's a naive to CD-38 targeting molecules. And what we see actually in the most recent data in 9 valuable patients recently at ASH, the ASH conference that basically you see in 6 of the 9, really, really impressive responses, which is roughly double the response rate, which we've ever seen with monotherapy of daratumumab. So I think efficacy-wise, this clearly seems to be shaping up as being differentiated, albeit that this is a very small data set. And we need to abate, I think the [indiscernible] the data which will come this year. Then safety-wise, we believe that this is actually an antibody which we can very safely administer to patients. And I know there was actually some turmoil last year about some grade 5 events, which we announced in the abstract for that presentation at ASH. But there was one patient which was diagnosed with COVID, and we know that these patients with COVID infections in fact, that are patients with B-cell cancer with COVID have really trouble. You know that also from other companies. So that may actually explain that grade 5 event. There was a lot of patients with cardiac arrest. And we also know that basically, cardiac complications happen a lot in COVID. In fact, that individual, this patient was not tested for COVID, James, but it is actually not unlikely, because the expansion almost run during the pandemic that this patient was also infected with COVID virus. And then there was a bit more turbulence about the second patient with a Grade 4 cardiac problem among the expansion cohort patients at the ASH presentation. And we are not worried about that because the patient had a history of cardiac events. And plus the cardiac events actually happened at the cycle 8. So very far during the treatment, and that's not logical to link that to the medicine because then you would expect it to happen much earlier actually in the therapy. So answering your question, you can never exclude that this is a very safe molecule until you have done more data analysis change, but you're not overly worried about the safety pattern of HexaBody CD-38, and we are very impressed by the initial efficacy data. So we are very excited about that data set shaping up in the coming months.

And when you say shaping up in the current month, so what further data will we see from that study? And then when will we get data from the head-to-head study?

I mean the data from the head-to-head study will very likely be visible in the second half of this year. And it all depends on how quickly we can recruit the 2 arms in the study. And we will give you an update, regular intervals on how far we are with the recruitment. Right now, we are on track to have all the head-to-head data in the second half of this year. And we will, of course, also follow the expansion cohort data in time. But of course, what we seem to see the taxable CD-38 have actually not only do the patients get into deep responses, the responses get better and better in time. And that's exactly what you would expect to happen with a well-working antibody therapeutic. So we will already update you also at some medical conference with further data from the expansion cohort in this year, we have not yet decided James about [indiscernible] well being.

And will the expansion cohort be just the same number of patients for longer? Or will there be further patients that will actually [indiscernible]?

No. The expansion cohort is only that same number of patients because we only needed that expansion cohort in order to get green light to do the head-to-head study. And the real value, I think, of the comparison will be to compare HexaBody CD-38 with the gold standard, which is [ subcu ].

And when we do get the head-to-head data, how robust do you think the initial data set is in terms of trying to extrapolate how much better the efficacy is because it's then DARZALEX, it's a single-arm study. Would you see -- we expect to see the same magnitude of differentiation in the Phase II? Or is that a bit too ambitious?