Instil Bio, Inc. (TIL) Earnings Call Transcript & Summary

Hello, everybody. This is Bronson Crouch, the CEO of Instil Bio. I'm joined with Zach Roberts, our Chief Medical Officer. For those who are just getting familiar with us, we are a company developing TIL as both a therapy and a platform to treat solid tumor cancers. TILs are [indiscernible] population of T cells that have experience in the tumor and naturally target multiple antigens cells important for the treatment of solid tumor cancers. Our experience in developing these therapies is experience is extensive. We the majority of our team having worked together previously in developing and launching commercially approved cell therapies. This year, we've been again enrolling our ITIL-168 Phase II clinical trial design with registration attempt. And planned approval in 2023. First half Of 2022 next year, we'll begin with ITIL-168 trials forward or additional indications, innovating on the TIL platform our next-generation CoStAR program, we'll initiate its first local trial in the first half of '22. We are committed to manufacturing in rolling our own destiny, and we can produce our own therapies from our facilities currently under management with commercial manufacturing sites under construction in Tarzana, California.

Great. Bronson, before we get into Q&A, I just wanted to read a quick disclosure. So hi, everyone. My name is Vikram Purohit. I'm one of the biotech research analysts with Morgan Stanley. And you've joined the fireside chat with Instil Bio. Very happy to have with me Bronson Crouch, Chairman and CEO; as well as Zach Roberts, CMO from Instil. Thank you both for joining us. Before we get into our conversation, I just needed to let everyone know of a brief disclosure. So for important disclosures, please see the Morgan Stanley research disclosure website at www.morganstanley.com/researchdisclosures. And if you have any questions, please reach out to your Morgan Stanley sales representative. With that, happy to get into the conversation.

So Bronson, you mentioned some opening remarks there, but perhaps for those who are not fully acquainted with Instil Bio and the company's platform. Maybe we could talk a little bit about your manufacturing process, your lead program, ITIL-168 and how you believe that translates into potentially differentiated TIL product.

So I'll kick off this real high level on our manufacturing process, and then turn it over to our CMO, to dive in into the other questions, Vikram. So at a high level, the manufacturing process is we take the -- we access the patient's tumor through surgical resection or biopsy goes through enzymatic digestion, cryopreservation and the shipment to the manufacturing site. There, it is expanded through to create a therapy. Over a period, roughly 24 days, it's cryo reserved and sent back to site for infusion to the patient. Zach, if you'd like to answer question specific on to say maybe add anything to manufacturing.

Yes, sure. Thanks, Vikram, and thanks Bronson. And nice to be with you here this afternoon. So just to add on to what Bronson said, the differentiation for the Instil Bio TIL manufacturing process begins right at the time of surgical resection. So we have developed a process and an infrastructure where an Instil Bio employee directly interfaces with the surgical team at the hospital center and recovers that resected tissue immediately upon reception and then physically transports that material to an area where that tumor is processed in the fashion that Branson outlined with immediate digestion followed by cryopreservation. We believe that this upfront white-glove handling infrastructure and procedure that we've developed, it will be differentiating and that allows us to take control of that critical starting material immediately after its move from the patient, stabilize it and ensure that it does not degrade at during the handling in transit over potentially great distances in over lengthy periods of time. Additionally, through this process, we believe that when that material is eventually thought that the manufacturing process is initiated that we will have a product that will encompass a broader range of TIL reactivity and eventually, that will be captured in the final product. The final piece I'll add before turning it back to you, Vikram, is that the fact that we're able to stabilize this material due cryopreservation allows us to fully uncouple the surgical reception from the manufacturing. And in cell therapy, having spent many years doing cell therapy in the context of CAR T this ability to fully delink the patient journey from the TIL manufacturing journey is a key operational benefit that we believe will smooth our or growth in the context of our expanding clinical trial portfolio as well as eventually in the commercial setting.

Great. I think that's a good segue into maybe discussing some of the data you've generated with ITIL-168. So you've evaluated this TIL therapy in a compassionate use program. So maybe just to level set for everyone, you could highlight some of the safety and efficacy findings that you felt came out of this program?

Yes. Thanks, Vikram. So as you rightly point out, the Instil Bio team has been working on TILs for a number of years. And the majority of this experience comes from a compassionate used program that has been in continuous operation since 2011 based out of the Christie Hospital in Manchester, England. And in that compassionate use program, 21 patients with relapsed/refractory metastatic melanoma were treated. And the data that we have developed from that program was shared in detail at a recent AACR poster presentation that is available on our website for further details. But at the high level, on the safety side, the observations that we made were consistent with the outcomes that have been described by others for TILs in melanoma. The adverse event profile was consistent with the lymphotopeeding preparative regimen that's administered to these patients prior to infusion, namely cytopenias, and then secondarily to the IL-2 infusions that occur after the TIL is administered. Those safety -- those adverse events were self-limited and managed without long-term sequelae much in the same way that others have described. On the efficacy side, we saw an overall response rate of 67% in these 21 patients and a complete response rate of 19%. 12 of those 21 patients were treated in recent years where PD-1 blockers were more readily available. And so just being a compassionate use program, patients must have failed all standard therapies available to them at the time of referrals. So the latter years, this included PD-1 blockers. And so those 12 patients had all failed PD-1. Incidental, only all 12 of those had also failed CTLA-4 blockers. So these were dual IO refractory patients. And even in this particularly difficult-to-treat subsegment of patients with melanoma, we still observed an overall response rate of 58% with one of those 12 responders achieving the durable complete remission for a CR rate of 8%. That's a fairly high-level summary of the safety and efficacy from our compassionate use program to come.

Great. And then pivoting to the Phase II study that you plan on starting by the end of this year, could you just kind of give us a sense of what are the key steps pending to be able to start the study and what level of regulatory interaction have you had with the FDA about the program?

Yes. So as we've previously disclosed, we had a very extensive pre-IND interaction with the FDA. And we've also had detailed scientific advice interactions with European regulators as well. And so as far as what remains before the launch of that study, we have not yet disclosed the status of more recent interactions with the FDA. But once the IND is approved, we will be ready to move into that study, and we remain on track to do that by the end of the year.

Understood. And to the extent you can discuss how large of a study do you expect this to be? And what kind of patients do you expect to enroll into the program?

So the size of the study is going to be consistent with other studies of similar products, cell therapy products. So going to be a single-arm trial. So the number of patients that we're going to enroll we haven't yet disclosed a specific number. but it is in the ballpark of where other studies of similar design have landed. And then in terms of the patient population that we'll be examining here, so this is going to be where the highest unmet need is in advanced melanoma and these are patients who are PD-1 relapsed refractory. And if they have a BRAF mutation, they will have had to have been treated with and have failed the BRAF inhibitor.

Understood. That's helpful. Maybe switching over to the regulatory side of things a little bit. So one obvious area of investor focus with TILs has been the issue of potency assays. Could you give us your current view on what you think the FDA strives to see with potency assays for TIL therapy? And what is Instil's plan to make sure that you are ready if and when the time comes first with the regulatory process with 168?

Sure. So I think we -- aside from our personal interaction, which I described before in the context of pre-IND. We -- our window into the FDA's thinking on specifically the potency assay is limited to the public disclosures that they've made. And the way we kind of interpret the totality of the evidence is that they're looking for a more detailed and targeted understanding of the activity of the cells in these products. And so we have developed a potency assay of our own that seeks to achieve just that outcome. And that it allows us to get a more granular understanding of the biological activity of the cells in our final product. And so for the potency assay that we have proposed to the FDA we are confident that, that will enable us to get into our phase -- into our upcoming Phase II trial. And in addition to that potency assay that we'll use for QC release. We are implementing a comprehensive characterization strategy as well in a prospective manner. So as we're enrolling patients in the trial. We'll be releasing products based on the potency assay that we've already developed. But in addition to that, we will be collecting additional characterization data with each individual lot that will enable us to more fully describe the activity of our cell products such that as we move into the next phase of development in with the BLA phase. We'll have all of our potency assay data from the QC release in addition to this comprehensive characterization package as well. We're pretty confident that when we get to the BLA phase, we will have a complete suite of data that will do a terrific job at describing the biological activity of our products.

Understood. And could you help us understand how the TIL product that was used in the compassionate use program may differ from the program -- from the -- excuse me, the product that you intend to progress through the Phase II study you're planning?

So it's our position that these products are the same. So the products that we administered the patients in the compassionate use program will be the same product that we administer in our company-sponsored IND. There have been -- as your question suggests, there have been some updates to the process that we use to make these products. But those updates have been focused on improving the robustness and the scalability and also the safety of the final product, but they do not reach the level that would be considered a different product. Probably the most important process update that we have implemented for the upcoming trials is the plan to systematically implement that tumor cryopreservation step that I mentioned at the beginning of the call. And that really is to enable a smooth transition from what was a single center study or compassionate use program into a global multicenter study with centralized manufacturing.

Got it. Understood. And we actually have a follow-up question from a member of the audience. So I'm going to leave that in here. So they're asking if a potency assay has been used or was used for the 21 patients that you evaluated in the U.K.

So not the specific potency assay that we have developed because that was a fairly -- that's based on large part on recent technology, more recent technologies that were not widely available at the beginning of the compassionate use. However, we have gone back and looked at samples from that compassionate use program retrospectively and use that to help develop that potency assay.

Okay. Helpful. I appreciate that. Maybe turning to the commercial side of things. So fast forward in a couple of years, assuming the Phase II program kicks off and is successful and meets the hurdle that you've envisioned for it. What level of activity do you think 168 would need to demonstrate in order to be commercially competitive?

Well, obviously, we're hoping for the highest level of activity that we can achieve, and we're certainly encouraged by the data that we've generated so far. That said, I'm also quite impressed with the data that's been developed by others in this field and believe strongly that the clinical benefit that those products have afforded these patients who really don't have many options at all, would meet or exceed the bar that is required for FDA approval. So I think that there's -- in these relapsed refractory solid tumors that have failed all approved therapies. The bar is remarkably low and for approval and the unmet need is so great that I think that sponsors like us have a clear path towards getting these therapies approved if they can be successfully manufactured and administered.

Understood. Before moving on to other parts of the pipeline, just maybe one more question on 168 and melanoma. So looking at ex U.S. potential, do you anticipate that the Phase II study are going to start by the end of the year that could be used for registration purposes in the EU? And if there's any discussions with the regulators that you've had on ex U.S. work that would be helpful to the extent you can kind of characterize that.

Yes, sure. So we -- Shortly after, we received feedback from the FDA on the pre-IND package last year. We made some adjustments to the package and then submitted it for scientific advice to both the EMA as well as the MHRA. And that was really in an effort to begin those conversations, get to know those regulatory bodies and begin to seek advice for them on what is going to be required to achieve marketing approvals in those geographies. So again, the same very comprehensive package was shared with each authority. And generally, we're very pleased with the nature of the feedback. And so, we plan to continue to interact with those agencies in many different ways and expect to be able to provide updates to the public as we go forward. But we are intending at this point to submit our package for marketing approval in those geographies as well.

Got it. Great. Okay. And so looking beyond melanoma, there's a couple of indications you've mentioned that you would like to study 168 in as well. Could you just remind everyone what those indications were and how you're progressing towards starting your initial programs with 168 in those indications?