iBio, Inc. (IBIO) Earnings Call Transcript & Summary

Good day, and thank you for standing by. Welcome to the iBio Fiscal 2022 Third Quarter Financial Results Conference Call. [Operator Instructions] I would now like to hand the conference over to Stephen Kilmer, Investor Relations. Please go ahead, sir.

Thank you. Good afternoon, everyone. Before we begin, I would like to remind you that during this call, the company will be making forward-looking statements regarding our current expectations and projections about future events that are subject to risks and uncertainties. References to these risks and uncertainties are made in today's press release and disclosed in detail in the company's periodic and current filings with the U.S. Securities and Exchange Commission. No forward-looking statements can be guaranteed, and actual results may differ from the results discussed in the forward-looking statements. The information on this conference call is provided only as of today, and we undertake no obligation to update any forward-looking statements made on this call on account of new information, future events or otherwise, except as required by law. On the call today representing the company are Mr. Tom Isett, iBio's Chairman and Chief Executive Officer; and Rob Lutz, the company's Chief Financial and Business Officer. With that said, I'll now turn over the call to Tom.

Great. Thank you, Steve, and good afternoon, everyone. As we reported during the third fiscal quarter, we received the FDA's response to our pre-IND package for IBIO-202, which is our nucleocapsid protein subunit vaccine candidate against the SARS-CoV-2 virus. We continue to plan for an IND filing for the intramuscularly delivered version of the candidate by the end of the calendar year. Additionally, we have continued to advance our lead immuno-oncology asset, IBIO-101 towards the play. Specifically, at the Frontiers in Immunotherapy Conference earlier this week, we presented favorable preclinical efficacy data on this anti-CD25 monoclonal antibody, showing that it effectively depletes regulatory T-cells as a prospective immunotherapy for solid tumors. While we've been focused on advancing those 2 lead biopharmaceutical programs, we've also published important performance data on the fast-forming development and manufacturing system. This includes recently presented studies that show plant-made monoclonal antibodies are comparable to molecules produced using traditional mammalian manufacturing methods. Importantly, in several cases, plant-produced antibodies had significantly greater homogeneity and thus, quality when compared with traditional systems. Additionally, we recently presented data showing that we can produce monoclonal antibodies with increased potency by applying our Glycaneering Technology. Of note, we also used the Glycaneering platform as part of the process of moving the IBIO-101 molecule onto our FastPharming System. We were thereby able to produce an afucosylated version of this monoclonal antibody, which resulted in the desired increase in cell killing effects when compared with the fucosylated version. With this achievement, we're pleased to report as part of today's update that we have now successfully completed the lead optimization stage for IBIO-101 and that IND- Enabling studies are now underway for this promising anti-tumor candidate. Given the positive developments for our Biotech business, for this particular call, we're going to change things up at that. First, I'll turn the call over to Rob to review our financial results for the quarter and discuss the upcoming Special Meeting of Stockholders that we announced today. Then I would like to take the opportunity to revisit many of the questions about our development programs that our Chief Scientific Officer, Martin Brenner and I received from analysts and institutional investors during some recent fireside chats and panel discussions. Normally, of course, I would ask Martin to join me here for this Q&A. Unfortunately, he has come down with COVID disease and isn't able to join our call today. So we'll do our best without them, and let's all wish him a full and speedy recovery. With that, let's get started with the review of our financial results for 2022's third fiscal quarter. Rob?

Thanks, Tom. I will speak to a few of our financial highlights, but please refer to the press release and the 10-Q for further details. Revenues for the third fiscal quarter of 2022 ended March 31 were approximately $1.9 million, an increase of 154% versus the third quarter of fiscal 2021. In the third quarter of fiscal 2022, we recognized $1.8 million in royalty revenue from the technology license with Fraunhofer. This license was part of the transaction that resolved our IP dispute with Fraunhofer. On a related note, we received the first of 2 $5.1 million payments from Fraunhofer for the settlement of our IP claims. The second payment is due in March 2023. R&D and G&A expenses for the third quarter of fiscal 2022 increased 157% and 60%, respectively, over the comparable period in fiscal 2021. This reflects our growing investments in iBio's pipeline, platform technologies, employees and related infrastructure. We anticipate this trend continuing. However, the rate of growth is expected to moderate over time. In terms of liquidity, at quarter end, iBio had cash and cash equivalents plus debt securities of approximately $48.6 million, excluding $5.9 million of restricted cash. We continue to believe based on assumptions related to our business, that we have adequate cash to support activities through September 30, 2023. I'll now turn to our upcoming Special Meeting of Stockholders that we announced today. We are seeking approval from our stockholders to authorize our Board to implement a reverse stock split and an associated decrease in our authorized share count, which together would result in a net increase in authorized shares for the company. We are pursuing these proposals for the same reasons as we described previously. Today, we filed a preliminary proxy with the SEC for these proposals. We are required to refrain from a detailed discussion on the rationale for approving the proposals until the proxy is approved by the SEC. Once that approval is received, we plan to post answers to the questions we would expect from our shareholders on our website. With that, I will now turn the call back over to Steve. Steve?

Thanks, Rob. If I may, I'd like to ask you a question regarding some of the mechanics of the Special Meeting. In last quarter's earnings release, iBio stated that it was working on solutions to overcome structural impediments to implementing the will of its shareholders. iBio shared the solution today in this press release. Could you walk us through that?

Certainly, we believe the increasing prevalence of brokerage firms, opting to forgo discretionary or proportionate voting of the shares held by them in Street name, has made it significantly more difficult for companies with a large retail shareholder base like iBio to secure affirmative votes from a majority of the outstanding shares as is required to pass proposals on a reverse stock split or a change in authorized shares. In order to help overcome this challenge, we recently entered into a stock purchase agreement of convertible preferred stock. Pursuant to the agreement, we issued and sold 1,000 shares of Series 2022 convertible preferred stock to an accredited investor for $0.27 per share, which was the closing price of the common stock the day the preferred stock was issued. The preferred stock permits the holder to vote at the Special Meeting of Shareholders for the reverse stock split proposal only with each preferred share entitled to 5 million votes, but any votes cast by such preferred stock with respect to the reverse stock split proposal must be voted in the exact same proportion as the aggregate shares of common stock. As a result, if a majority of common shareholders who vote are in favor of the reverse stock split, the proposal will likely pass. And conversely, if the majority of shareholders who vote are against the proposal, they will not pass. The votes of the preferred stock merely reflect the same proportion of the votes of the common stock.

Thanks, Rob. And finally, before I turn it over to Tom, I'd like to ask a finance-related question regarding iBio's acquisition of the FastPharming facility. What is the company's strategy there?

As we previously announced, as the primary part of a larger transaction, we purchased full ownership of our FastPharming facility and all the rights to operate and grow the facility., Now we are evaluating a sale leaseback of a facility that could free up capital. We believe a sale leaseback with the right partner might give us most, if not all, the benefit of ownership while freeing up capital to invest in our asset pipeline.

Great. Thank you, Rob. I'm now going to post on frequently asked questions to Tom regarding iBio's development programs. So Tom, our first question is regarding iBio's overall COVID vaccine strategy. And specifically, why you think targeting the end protein will be successful despite the ample supply of competing vaccines already on the market?

Okay, Steve, you're diving right in with a great question. So all the currently approved vaccines are based on generating immunity to the SARS-CoV-2 virus with technologies that mimic exposure to the virus spike protein. That initially made sense as part of the industry swift response to this pathogen given that's the protein the virus uses to bind to our cells and infect them. And also, it generates a strong neutralizing antibody response in humans. However, as the virus has evolved, selective pressures favored spike protein mutations that led to the emergence of new variants that were better able to overcome the immunity generated by vaccines and natural infection. So we've already seen the issues that occur by relying on spike-based vaccines with the emergence of the highly infectious Omicron variant and its sub-variants. These are more than 30 mutations in their spike protein compared with the original strength. So the more mutations that accumulate, the less effective and dermal the spike protein-based vaccines may become and some experts that have even been predicting that we will ultimately see an escape barrier that completely alludes spike-based vaccine immunity. So even if not, we're seeing that overreliance on spike base vaccines is leading to the continuation of the pandemic and perhaps now going forward, COVID becoming an endemic disease. So we continue to believe that the nucleocapsid or I may refer to it as the end protein represents an important target for next-generation COVID vaccines for several reasons. First, the N protein is abundantly expressed during infection and contains multiple immunogenic episodes, and that translates to multiple opportunities to elicit an immune response. Second, the N protein is more highly conserved. And so therefore, it's less likely to mutate than the spike protein. Thus, new variants should be less likely to escape N protein-based vaccine protection. And third, research has shown that the nucleocapsid protein appears to be more effective than the spike. It's stimulating T-cell activation, which is a critical element of the adaptive immune response that SARS-CoV-2 virus attempts to abate. So that's to our novel antigen, adjuvant combination that we had built into the design, and that may afford greater durability. All that has us believe that we've got a winning approach here.

Thanks, Tom. Building on that question, why is it taking so much time to develop IBIO-202 considering iBio seem to be working on a vaccine soon after the pandemic hit?

Yes, that's fair. Well, first, I'd like to preface my answer by noting that the circumstances of the COVID pandemic have been changing rapidly, as we all know. And we certainly hit the ground running with our own spike-based vaccine in the earliest stage of the pandemic. In fact, we went from generating a spike protein sequence in the early days of February, I think it was February 4, 2020, to our first manufactured material in just 5 weeks, which rivals the speed of the mRNA vaccine platforms. But as we were generating our preclinical data to advance what at the time was our IBIO-200 and 201 programs, other spike protein-based vaccines entered late-stage clinical development, bolstered in part by funding from operation warp speed and a favorable regulatory environment for platforms like the mRNA ones and some of the others that had already been through late-stage clinical trials with other diseases like influenza. Now, while we're all fortunate that our industry and governments were able to achieve, what arguably is the most rapid and effective response to a pandemic in our history, it just didn't make sense for iBio to continue to pursue a me-too spike-based vaccine given there were satisfactory solutions about to gain regulatory clearance with those existing first-generation vaccines. So a little more than a year ago, we took a step back and anticipated what could happen, which is that the pandemic would evolve as it has with rapid spike protein mutations resulting in reduced protection from first-generation vaccines. So we looked at the research from previous SARS virus outbreaks like SARS1 and MERS, for instance, that's Middle East Respiratory Syndrome and identified the nucleocapsid protein is a better choice for creating a more durable vaccine. Today, we believe we are, therefore, now very well-positioned to move into the clinic with a second-generation vaccine that enables us all to move more so towards our last COVID shot, hopefully not just our next shot.

Great. Thanks, Tom. Okay. Let's move on to IBIO-202's development pathway. Were you expecting the FDA to make you do an IND-Enabling challenge study?

Well, the short answer is we were hoping to avoid it, but at the same time, understood that it was possible, if not likely, the FDA would ask for it. In fact, it's typical for a novel vaccine to be tested in a preclinical challenge model before entering clinical trials. And the unprecedented situation at the height of the COVID pandemic when no vaccines were available, allow drug developers some additional flexibility. But generally, these tests are required. So we've launched our challenge study and expect to provide outcome in data by July 2022.

And on that note, what would be the next step, assuming IBIO-202's IND is clear?

Well, once we have submitted the IND for IBIO-202, it will be, of course, reviewed by the FDA, which will either accept or reject our plans or may ask for changes to the submission just like with any other one that any company might submit. Now, once the agency is satisfied with the IND submission, we are allowed to enter clinical phase -- Phase 1 clinical trials, but there is a certain time period usually 4 to 8 weeks of intense preparations before the first subject can be immunized.

Thanks, Tom. Just moving on to the plant-based manufacturing aspects of IBIO-202. Does FDA have any issues with this?

No. The FDA has not expressed concerns regarding IBIO-202 in the manufacturing platform associated with it or any of iBio's therapeutic candidates being manufactured in plants. In fact, there are already several plants or plant T-cell produced biopharmaceuticals that are in various stages of development or even FDA cleared. Protalix' enzyme replacement therapy received FDA clearance in 2012, and that product is manufactured using plant cell culture.

Great. Now some questions about the other candidates in iBio's pipeline. The first one is regarding our iBio's endostatin E4 molecule for fibrotic diseases. What makes iBio think that this antifibrotic will be effective for the treatment of solid tumors?

You can add a little bit there, Steve, but I think I got the question. So there are a wide variety of cells that are present in the tumor microenvironment, including what's called cancer-associated fibroblast or CAFs. So CAFs are one of the most abundant and critical components of tumor tissue since they provide this physical support for tumor cells and can promote or slow tumorigenesis in a context-dependent manner. So these cells are also involved in the modulation of many components of the immune system. So recent studies have revealed the wall of CAFs in immune evasion, poor responses to cancer immunotherapy and variable responses to chemotherapy, which are all serious problems here, so we believe the endostatin E4 molecule has the potential to normalize fibrosis without the detrimental effects of CAF destruction, thereby improving responses to current standard of care treatments such as chemotherapy and immunotherapies. So our partner, University of Texas Southwestern is performing proof-of-concept studies, which, if successful, would see the molecule advance into the next stage of development.

Thanks, Tom. Let's turn to our partnership with RubrYc. What has these parties brought to the table? And what is your outlook for the partnership?

Yes. RubrYc Technology enables us to specifically target confirmational and subdominant epitopes for which it's hard or even impossible to find antibodies. So what does that mean? I'm referring to their discovery engine where they use predictive algorithms to do better targeting and create these binding sites for antibodies. So while RubrYc's expertise lies in the front end of the drug discovery process, iBio provides extensive expertise in building and advancing drug discovery pipelines. So we envision leveraging RubrYc's selection, expertise, partnering with RubrYc on the screening and then using the FastPharming System to rapidly develop drug candidates, while really at the same time using what we're advancing is a way to validate RubrYc's platform and their discovery engine. And kind of by way of example, I guess. So RTX-003, that's the anti-CD25 antibody that we in-licensed from RubrYc. That's a good example of how our FastPharming System can outperform traditional mammalian system. So generating afucosylated antibody so that's basically fucose is a sugar -- the traditional mammalian cell manufacturing methods kind of like to put on antibodies, but that's bad. And it's bad because if you're looking for tumor cell killing, fucose on the antibody messes that up. So the idea of afucosylating the antibody, making sure that, that sugar never gets put on there, increases the antibody -- its antibody-dependent T-cellular cytotoxicity. So basically, it's cell-killing capabilities. So doing that with mammalian cells can be costly at both the front and the back end of development, oftentimes because for mammalian cells, that technology is owned by others. So there's IP access, intellectual property access fees, milestones, royalties, etcetera, that can be involved. So we are developing the plant made version of RTX-003 is IBIO-101. And we got freedom to operate for being able to do the afucosylation in our own plants and thereby avoiding some of those third-party IP access requirements. So we've demonstrated that by applying our Glycaneering Technologies, we talked about a little bit earlier here in the call, that the FastPharming System can produce a potent, high-quality afucosylated molecule that is equivalent to the same version of the antibody produced with traditional mammalian cell culture manufacturing methods.

Great. And can you talk a little bit about IBIO-101and its potential?

Certainly. While many immunotherapies have remarkable effects on cancer treatment, certain solid tumors remain challenging. Even in indications where they show efficacy, a significant percentage of patients don't respond. The immunosuppressive effects of regulatory T-cells or Tregs, has been known for quite a while. So eradicating them from the tumor microenvironment has long been thought to be a potentially attractive way of helping to treat cancers. However, the first attempts of creating an anti-CD25 antibody that could bind to and destroy these regulatory T-cells were a little disappointing. And that's because although they depleted the Tregs, these antibodies wound up locking an important signal to other T-cells that -- and those T-cells, T effector cells kill cancer cells. So essentially, even though the Tregs were being cleared, the effects were canceled out because the T effector cells and the signaling to them to tune up the cancer cell killing activities cancel each other out. Thus, the recent development of an anti-CD25 antibody like IBIO-101, which depleted Tregs without interfering with the signals to other T-cells has the potential to address the unmet medical need of non-responding patients. So we're very excited about IBIO-101's potential and even more so when we think about its potential in combination with checkpoint inhibitors.

The final question is what is iBio focused on for the remainder of 2022?

We have 2 areas of focus for the remainder of the year. First, continuing to advance our oncology assets and especially our lead IBIO-101 by executing on our IND-Enabling studies. And of course, we are working to bring a last dose, not an X dose to the COVID-19 pandemic with an IND filing for IBIO-202 before year-end. As we mentioned in our press release today, we believe becoming a clinical stage company will be a major value inflection point for iBio.

Great. Thank you, gentlemen. That's all the questions I have. Operator, we are now happy to open the call to address any additional questions from our audience.

[Operator Instructions] Your first question comes from the line of Roy Buchanan from JMP Securities.

I guess the first question, I want to follow up on what you're saying there towards the end, Tom, on the afucosylation seems particularly powerful and broadly relevant to drive efficacy and maybe I'll speculate a little bit on maybe life cycle management. And I know you guys are -- you mentioned it in the last comments focus on the proprietary pipeline. But also how active are you in seeking out partners for the technology at this point? Do you still have kind of that business line going?

And maybe there's 2 ways you mean that question, right, because it could be partners, those that are interested in accessing our Glycaneering capabilities so that they can make their molecules? And were you also referring to maybe partners for IBIO-101 itself?

Yes, that's good. And also, yes, that sounds great.

So I'll take both. The -- in terms of the outbound and using the FastPharming System and the Glycaneering Technology, one of the things that we're able to do is maybe help some smaller biotechs in particular, that have innovative new antibodies for whom they're looking or for which, I guess, I should say they're looking to increase the potency through that afucosylation and without having to go and tap into those who own the intellectual property in the space for doing so in the traditional mammalian methods. At the moment, we've got a royalty-free license-free method to help them move that forward quickly by producing in plants with the FastPharming System and just doing the service fees really for the early process development work and some of the rest is part of our standard contract development and manufacturing services. But what's interesting here, too, for us because in our business model, we have opportunities to generate growth here for the business, not only through those sorts of CDMO services. But by virtue of the fact of what we've done here in our relationship with RubrYc, we found a way to take their molecule, which, by the way, is the fucosylated version performs better and by putting it on to our plant-based system where we could easily and cost effectively afucosylate that molecule as well to produce a more potent version than the fucosylated whether that was in mammalian or plants. We're now putting ourselves in a position where as we look forward and bring that molecule into the clinic that perhaps there are partnerships that would make a lot of sense. And I think it's fair to note in comparison, really, the only other anti-CD25 molecule out there that doesn't have this IL-2 blocking component to it is -- or I guess, I should say, was a company by the name of Tusk Therapeutics. So they had an IL-2 sparing anti-CD25 Treg depleting monoclonal antibody themselves. And with data kind of about what we have right now in terms of our preclinical data, they wound up ultimately doing a partnership, really a sale of that asset to Roche, who now has it in a Phase 1 clinical trial, and I believe not only is a monotherapy, but married up with a checkpoint inhibitor. So we're certainly looking at that situation, they did that deal. It was all preclinical at the time. And the opportunity for us to be able to manufacture the product, get it into the clinic, certainly, we're going to be eager to see how the Roche clinical trials proceed, but we think there's just a ton of promise. Obviously, they do too. And for those other entities that are out there with a checkpoint inhibitor, we think that the way the technology looks that there could be some nice opportunities for a partnership and a clinical trial that looks at that. So of course, we're going to remain open to that but look at what's in the best interest of the company and its shareholders in terms of the value of the asset, which we -- per the presentations here recently of the data that we've had, we'll just make the best decision in the interest of our shareholders and of the business.

So I might have a follow-up on the endostatin program for cancer, and then I'll jump back in the queue. I guess, maybe I missed it, but can you talk a bit more about the data that we're going to get in the second half, kind of what our expectations should be? And then what your next steps are after that assuming it's positive?

Yes. I mean we look at -- great question. We look at UT Southwestern is a real leader here in this area, especially with these fibrotic tumors. I think your pancreatic cancers and some of the rest, which sadly took the life of a dear friend of mine, not that long ago. And you get these tough fibers tumors and UT Southwestern is one of the leaders in the area. They have some excellent models in preclinical and early-stage research things. So they're running those studies for us. I think we're -- don't hold me to this. I think we're expecting some of our data towards the end of this calendar. I'll have to get back to you on that with a specific without Martin here. But I think it's -- some of the initial data is coming in here in calendar 2022, but I'll get you an update on that.

Your next question comes from the line of Kristen Kluska of Cantor Fitzgerald.

This is Rick on for Kristen. We have a couple here for you. In the poster recently presented at Frontiers in Cancer Immunology -- I'm sorry, Immunotherapy 2022. What would you say about the binding kinetics of the plant versus CHO cell-expressed IBIO-101 candidate? Are you satisfied that both seem to have similar binding profiles or were you hoping to see something different with the plant expressed candidate?

Yes. We were -- we saw what we were hoping to see. So the sort of the buying and release was what we expected. We were expecting something very similar to the mammalian and that's, in fact, what we got, which is often -- well, actually, that's been our -- everything that we've seen on the FastPharming plant-made platform. We do expect it to perform similarly, if not, in some cases, slightly better than the mammalian technologies. And so the quality of what we're getting and then having it in practice in the animal models turn out the way it did from the binding kinetics and some of the rest matched up pretty well versus expectations.

Understood. And maybe on sort of a follow-up there also on the poster. Also in the same poster, you compared the afucosylated version produced in plants to the version producing in CHO cells. While we understand the advantages of FastPharming system for production at scale, how should we be thinking about differences in terms of the effective concentrations of antibody that you used? And you saw effective in vitro cancer cell killing between the plant and CHO sell. How should we be thinking about sort of concentration differences seen there?

Well, as you're pointing out, Rick, you really did have a like-for-like when it came to the fucosylated versus the afucosylated. So what we saw is essentially what we expected this whole way through that with -- regardless of manufacturing platform, you saw the same sort of concentration-dependent effect in vitro, right? So in afucosylated version in both cases performed better in a concentration dependent manner in a fucosylated one, which is what you'd want to see. There was not an expectation that a plant -- a Glycaneer plant version would performed better than a mammalian afucosylated version. The expectation was they would be the same. Now, that may change over time with more data coming in and all the rest. But we're very happy by what we saw in terms of both the quality and the consistency of the molecule produced in plants and also the data that we got, which at the end of the day, what it's all about is can you deplete these regulatory T-cells from the tumor microenvironment and do it effectively and then free up the immune system to go ahead and take down these solid tumors. And that's what's most important. But of course, we're thrilled to see the comparability of the 2 systems, both afucosylated and not.

Okay. Maybe if I can just ask one more. With IBIO-101 moving into IND-Enabling trials, could you talk about what we could expect in terms of potential updates during this next phase? Could you look to present data at relevant conferences or should we be looking for updates via press release, for example?

Yes, Rick, probably both. And so what we would expect is as we go forward, as there's opportunities to present more on, let's say, the plant made versus mammalian produced molecules we're interested in continuing to roll out the data, much as you've seen, especially over the past 2 weeks, showing that comparability on the platform side of things, then most importantly on working towards getting into the clinic with this molecule, which we're thinking about this time next year. What we anticipate is the next big chunk of data for IBIO-101 irrespective of how we're making it is tox data. And we would expect to put out a paper on some of the in vivo efficacy for 101 as well. So you'll get that both in probably I would say, or one might expect that there could be both publications and press releases sort of depending upon merit. I hope that helps. And most of this -- within the next 6 to 9 months.

Your next question comes from the line of [ John Oldham ] from [ Easybites ].

I'm a longtime shareholder ever since November 2019 before COVID. And I was curious as I have a 2-part question, and it's on IBIO-400. Just wondering what our timeline is for the USDA approval of the facility? And after the facility was approved, when do we expect shipments from the IBIO-400 project?

And as I believe we put into the press release, what we're doing right now is working forward with USDA to get a reviewer assigned first and foremost. And it's unfortunate, sometimes these things change and especially with COVID and some of the rest. So we wound up having the reviewer/inspector get changed. That caused a little bit of delay. We were hopeful that we would have already been down the road by now. So as this travels together, we're a little bit hesitant to comment to when the regulatory process will free us up to be able to move forward. But after you get the -- after we get presumably, the regulatory clearance on the facility, as we may have noted, a first-time submitter, it tends to take a little longer there to anyway. Now, the good news about a vaccine that goes through the animal health pathway in the U.S. Once you get there, it's oftentimes much quicker and less costly than the human health side of things, but the key is that first barrier. So it could be upwards of a year, even after we get the regulatory clearance on the facility. So more to follow on that, of course, we're keen to -- well, we're going to continue to update as everyone, as we did here today on developments on that front. But the key is getting the next reviewer/inspector put onto our particular file and then moving it forward.

And last question, after the RS is approved, when would we expect to enact it?

Well, the Board would help make that decision. So we're just asking for the shareholder approval to do the reverse. And we would do it and look to be considered with timing because what we want to do is obviously what's in the best interest of the company and shareholders. And one of the things that we've talked about in the past, and I want to be careful here only because of what Rob mentioned a little bit earlier, which is that until the SEC clears our proxy, and we're okay to talk about this. I guess I would probably be best just to point us back to some of the stuff that we've had on the website before. But I think it's probably fair to say that it would be -- once we get the approval, it would be the Board then would make the determination on the timing. But Rob is there anything I'm missing there?

No, I think that's right, Tom.

Your next question comes from the line -- or it's a follow-up question from Roy Buchanan from JMP Securities.

I just noticed you guys have a presentation at ASCO in the calendar. I know there's embargoes and all that kind of stuff, but can you give us a general sense about what you're planning to present?

I think I don't want to be premature with what we have going there. To your point, Roy, I think when appropriate, we'll, of course, release additional information on what we have going on at ASCO.

Your next question comes from the line of [ Philip Barndette ], a private investor.

I just have a comment and then just 2 quick questions. 3 to 4 years ago, iBio posted data, which showed the rituximab biosimilar had a 30x increase cytotoxicity. I asked about it in the last call, you said it wasn't worth pursuing, that it was only used as proof of concept. Like looking at RITUXAN, it's one of the best-selling oncology drugs in the market. And to hear that that's not being pursued is crazy. 2 years ago, when you spoke, I know, heavily with shareholders about golf scores and you're the company's biggest height man. And the Hill interview, you mentioned driving around having conversations with BARDA and then fell silent. And all the while, the share prices fell. You mentioned the dark days. It feels like we're there again. Previously, we did a 1 to 10 reverse split back in 2018. That didn't save the company, I don't think. Then you canceled the reverse split in 2020. Then you tried to ram one down our throats 10 to 1 back in 2021. Now we're going 1 to 25. It just feels like you're punishing shareholders at this point. Reverse splits do not save companies. I think products like the rituximab biobetter save companies, funding from government, maybe that RFI would have been a great way to save the company rather than push this reverse split through? Not happy to hear that. iBio has got incredible technology, and it seems to just have gone nowhere. I won't make you comment on any of that. I just want you to know that there's a lot of frustrated shareholders out there. For my first question, you've heavily expanded the iBio team, but there's only been vertical pipeline movement. There's been no horizontal movement, which is really what counts. Why are you hiring so many employees and expanding a very expensive executive team?

Well, Phil, I mean, I'd actually be happy to comment on some of the other stuff, but I'll just take this question and challenge the premise. I think we've done both. So what we've clearly demonstrated is that vertically, we have added new pipeline candidates. And I think if one was to look comparatively at the rest of the industry, what we've been able to accomplish in a very short period of time, we only just announced our drug discovery capability right around this time last year. And we're only beginning to hire the team. We had -- we didn't actually have anybody hired when we announced it. So I think it's very fair to say that we have the vertical stood up. And if you were to look at anybody else trying to accomplish the same thing, I think, on a comparative basis, it's very strong performance. And then just last quarter as well, when one takes a look at the horizontal progression, we've significantly moved 101 forward, which is a major opportunity. Again, you have to look at the comps in this space, for an entity like iBio who's just coming to its own biopharmaceutical development, which is our strategy to change the course of the company and to move where we were with our market cap when kind of mostly got involved with the firm in late 2019 from whatever we were $5 million or $10 million market cap to now beginning to have a pipeline with real value in this, I'll point to 101 again, the Tusk-Roche deal was, I don't know, $75 million, $80 million upfront, $0.75 billion and if milestones are achieved, additional payments. And so here we are advancing 101 fuller towards IND-Enabling. And then also with the deal with RubrYc, again, that's just a few short months ago. We're in a position where we've taken an initial candidate concept, design an antibody, move straight through early discovery to late-stage discovery and are progressing that particular target at a speed much faster than the rest of the industry does it. So just, by the way, from concept to clinic on an IND for every 5,000 molecules that start out maybe 5 get to clinic. And oh, by the way, those take 4 to 5 years and $20 million to $25 million to get there. And as we talked about on the last call, we're already progressing those in a significant way, not to mention the rest of the pipeline. So I think the track record is great. And you got to keep in mind this team's brand new. So we hired folks, to answer the question directly, to do just this. And one can, I suppose, some other time debate the merits of a strategic choice and what areas to target. But by way of example, rituximab, sure, that's a great molecule. There are gigantic competitors in place all across the world that have done biosimilars. And for us to put cash behind that would have been, in our humble opinion, probably about as wise is trying to take on Pfizer, Moderna and J&J and COVID vaccines was something that they're already doing with another spike-based protein. So we're very proud, quite honestly, of the talent that we've brought in, the assets that we're creating, opening up the partnering opportunities for our molecules. But unlike a lot of other biotechs, also if we choose or when we choose to partner out at any given one of those assets, then we've got the opportunity, unlike many other small biotechs who do their deal. And that's not because of our manufacturing services and platform, we actually have the opportunity for our captured supply agreement with some of those folks. So I appreciate the 2 things. The disappointment, obviously, I think the entire biotech markets are. It's sort of incredible lows -- and we -- not that we're -- we shouldn't be moving forward with trying to outperform the market, which, of course, we are. But this has been across the board. But what we've built, we feel very positive about. Sorry for the disappointment on the stock price. Obviously, we wish it was up, but we have full confidence that it's going to be recognized over time, and we're going to return value to our shareholders. So we like our strategy. I like the execution, and we have a very positive outlook for the business going forward.

I've been here since 2015, so I'm very hopeful for the company as well, and I was here during those dark days. So I have confidence in the company, but -- and just like looking at it right now, going -- what are we looking at here? And so I guess in the spirit of directly generating revenue, what is, in your view, iBio's focus, like what's that first thing that we're going to bring to market that's going to finally generate revenue for the company? It seems like the deadlines just keep getting pushed out.

I don't know about that, but I guess what I would say is focus on -- when it comes to the biotech pipeline, 101 and 202 once again, not to be redundant on this, but tested their deal with Roche, roughly the same point or maybe a couple of months behind technically speaking, where they were when that deal went forward. And this is, again, I don't mean to indicate in any way that we wouldn't want to hold on to the molecule and not partner until much, much later, right? We're not going to get into our whatever business strategy for any particular instance. We want to just see how that performs in the clinic. You've got 202 that's advancing. We have a long list -- not a long list, we have a list now happily of assets that we're developing on our own -- and we have a few dollars here or there on the services business. So that's our view. Again, every investor has to make their own decisions, evaluate critically your view of our pipeline. I'd encourage everybody to, of course, do your research, look at the indications that we're going forward, look at the space, immuno-oncology. And we're, of course, being transparent with what we're moving forward. And hopefully, we continue to advance a number of these molecules with the platforms and technology strategies that we have and some of those targets that are presently undisclosed, not all of them will move forward. We already talked about the numbers. There's a lot of dropouts in early-stage drug discovery, but our plan is to design better molecules, take more shots on goal. Where there are failures, fail more quickly and move forward, but we believe that we're designing better molecules. And we'll have more shots on goal and that kind of portfolio returns value to biotech investors over time because of the partnering opportunity. So I guess that's how I would sort of summarize that, but I appreciate your comments. Sorry for the long time, ups and downs, but we're very happy and confident with what we built here. We think we've got a great team, and we made these investments to take the company to a very different place. We're not terribly interested in iBio 2008 or 2015 or any of that. We've been pretty clear with our strategy and direction since whatever 2000 when we took the [indiscernible] our own molecules and capabilities. These things take time. As you know, I think the average is 10 and $1 billion for a molecule to go all the way through and get released, but a lot happens in the biotech world with bartering and all the rest in between. So anyway, but again, thanks, Phil. Appreciate the questions.

Your next question comes from [ Alfred Gonzalez ] from [ iBuyer ].

First, I'd like to say congratulations on everything that you have accomplished with iBio. I don't think that you are getting a fair review. I am in [ stock streets ] literally day and night, and I could see the good and the bad comments. And I don't think that you're getting a fair review with everything that you have accomplished. Now having said that, I think to the point of transparency, it could be done better because right now, you guys increased your inventory on hand from $27,000 to $3.2 million. Now anybody looking at that would say, well, these guys are getting ready for some major manufacturing because historically, iBio has not kept that much inventory in hand. And even with the prospect of supply chain problems, that's still a huge amount of inventory compared to what has been historically kept on hand by iBio. So what I'd like to know is why is such a huge increase in the inventory in hand? And is it because you are, in fact, considering that you're going to be manufacturing a whole lot in the next few months because if you were to tell me that this was just only due to supply chain issues, then I will say, wow, you guys are not planning well because to me, that's just an enormous amount of inventory in and compared to what historically iBio has been keeping on hand. So can you elaborate on that?

Sure. I mean you take a look at iBio and from when it was only doing CDMO services and not really having I suppose, introduced even the Glycaneering Technology and some of the other capabilities, there wasn't much in the way of revenues, right? So if you're not manufacturing a lot for folks there'll be a lot of inventory. And so I guess I would just guide to say the historical comparison is not really useful here because, A, number one, the manufacturing game, this whole industry, it's very expensive. This is why it costs 10 and $1 billion to move a molecule through because making a biological molecule is very, very costly. Just the production of it and the purification, some of those consumables, those raw materials, you'll spend a couple of million dollars to do CGMP manufacturing routes. So you put that -- so to answer one aspect of your question, absolutely. We're increasing the inventory because we've got 101 that we're getting ready to move towards the clinic and same thing for IBIO-202. So you have to do your engineering runs. You have to then plan your manufacturing. And then the second thing is also what you said, which is affecting the entire industry, not to mention the globe arguably, which are these serious supply chain constraints, take a look at any other biotech company out there. All of them are suffering. You see major -- you see biotechs, you see contract development and manufacturing organizations. really struggling to get some of these critical raw materials in place. And for many companies who don't have their own -- many biotechs, I guess, I should say, they don't have their own manufacturing capability and have to rely on third-party service providers. Many of their clinical trials are delayed completely because they can't get their CDMO to manufacture their stuff for them. So easy answer, it's both. Yes, we're getting ready to advance our products to the clinic, which is what we told everybody, number one. And number 2, we can't here as a team, make these claims and just pretend like we're going to be able to access critical consumables at the drop of a hat. The supply chain situation requires us to make sure that we have ample backup and can really execute behind these timelines that we're promising everybody or attempting to promise. But once again, as we put in our risk factors, just like everybody else, supply chain could torpedo any one of our particular timeline. So that's why we're working aggressively to build up the inventory of raw materials that we're going to need to deliver on time and keep our programs moving. I hope that helps.

And your next question comes from [ Sammy Daniel ] from [ Olin ].

My only question, what's the reason behind this reverse split again?

Well, severalfold as we put into the announcement. Once again, we're being a little cautious until we get the SEC approval on some of this. But again, I'm referring back to what we had mentioned in the past. If you look at the reverse split, there are investment firms and houses that may not initiate with companies who have stock prices that are low. So sometimes below $5 an initial investment into the firm is impossible for some of their rules. You can take a look even at some of the indices that are out there, I believe such as the Russell and some of the rest. So if you have stock prices that are under $1 that can impact. And then just general perception of the stock, especially as the number is sitting there below $1 significantly, there's not really a change. On the day that one goes ahead and institutes a reverse split, the market cap at the moment that it occurs, obviously doesn't change. It's just a different number of shares. It's just an exchange, which is simply a transactional thing. But if the perception or certain qualifiers for investment purposes can be improved by a reverse stock split, naturally, one would want to do it. And that's why the Board has recommended all shareholders to move forward.

And there are no further questions at this time. Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.