IO Biotech, Inc. (IOBT) Earnings Call Transcript & Summary

Good day, and welcome to the IO Biotech Webcast and Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Amy Sullivan, Chief Financial Officer. Please go ahead.

Thank you. Good morning, and welcome to the IO Biotech conference call to discuss the top line results for our Phase III pivotal trial of Cylembio. A press release with the top line results became available at 8:00 a.m. Eastern Time today and can be found on the Investors section of our website. Before we begin, I'd like to remind you that certain information contained in this presentation contains forward-looking statements within the meaning of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Our forward-looking statements are based on current beliefs and expectations of our management team and are subject to risks and uncertainties, including risks related to the timing or outcome of communications with the FDA, submission of a BLA, the company's financial position and cash runway and other risks set forth in our filings with the U.S. SEC. Actual results and developments could be materially different from those expressed in or implied by our forward-looking statements and you are cautioned not to place undue reliance on these forward-looking statements, which are made only as of the date of this presentation. Joining me on the call today from IO Biotech are Dr. Mai-Britt Zocca, our President and Chief Executive Officer; and Dr. Qasim Ahmad, our Chief Medical Officer. We also have Omid Hamid, Director of Clinical Research and Immunotherapy at The Angeles Clinic and Research Institute, A Cedars Sinai Affiliate. Following our prepared remarks, we'll open the call for Q&A. I'll now turn the call over to Mai-Britt.

Thank you, Amy. Good morning. Thank you to everyone who has joined us for the call this morning. We have tested Cylembio in combination with pembrolizumab in a randomized Phase III study where we have tested this combination against pembro alone in first-line advanced melanoma. With these top line results, we have been able to see that patients treated with Cylembio plus pembrolizumab achieve clinical improvement in PFS. However, it came with a narrow miss on statistical significance. What we are seeing in the primary endpoint is a PFS that readout with a hazard ratio of 0.77 with a p-value of 0.056. I want to remind everybody on the call here today that in order to achieve statistical significance, the bar for statistical significance was 0.045. So this was a very narrow miss, just by a hair. What we saw in the medium PFS was an impressive 19.4 months in the experimental arm versus 11.0 months in the control arm. And we have seen an improvement in PFS across virtually all prespecified subgroups and all certification factors. This improvement is observed without any significant added systemic toxicity versus pembro alone. And based on these results and the totality of the data that we will share with you in the call today, we plan to discuss the path forward with the FDA in the fall. We believe in the totality of the data from this study, including the risk/benefit profile and plan to present our case to the FDA so that we can proceed with our plans to submit a BLA towards the end of this year. We see the opportunity in the market as being still relevant for the data supporting Cylembio, and we are pleased to have Omid Hamid with us here today to share more details on this later on in the presentation. I just here would like to highlight that there is still a significant need. 50% of the patients progress within 1 year of treatment in the first-line advanced settings. I would like to remind us all here at the call today that we have global supply chain and distribution in place. We believe we are ready also with the manufacturing at commercial scale with our well-established CDMOs. I do not want to go into details in the call today about this, but just mention that Cylembio is not only linked to melanoma as an indication. Based on our targets, which are expressed in multiple different tumor types, we believe Cylembio has potential across indications and is currently also being tested in other indications and also in earlier stages of cancer settings. And with that, let me just take us through where we are and which indication precisely we are discussing here today. So you can see here a slide about the melanoma patient journey. Of course, when a patient comes in and they are diagnosed, they get nervous and they get as uncertain about the future ahead of them. What we are focusing on in our treatment and the readout of the Phase III trial that we share with you today is the patients under the bullet point number 4. These are patients that come in with unresectable metastatic melanoma and the numbers are high. We have 15,000 patients in this category annually just in the U.S. alone. And that high unmet need is still existing due to the lack of sufficient efficacy as well as the toxicity issues from available standard of care. We believe that our data make a case for submission of our BLA of a novel type of drug, which demonstrates a clear clinical benefit without adding substantial systemic toxicity. And I trust that you will agree on this with me when I've gone through the data here in more details. So I have already given you the number of the intent-to-treat analysis of testing Cylembio in combination with pembrolizumab, where we read out with 19.4 months versus 11 months in the control arm. And this came with a PFS with a hazard ratio of 0.77 and a p-value slightly missing what we were looking for at 0.056. When looking at the patients that were in the protocol group, Cylembio plus pembrolizumab comes out slightly above what we saw in the intent-to-treat analysis. Here, we see a median PFS of 22.1 months versus the 11.1 months in the control arm. If we look at the population from another angle and that more resembles what we had in the Phase I/II trial, the proof-of-concept trial that was the foundation leading us to execute this Phase III trial, and therefore, excluding the 36 patients with prior anti-PD-1 exposure, leaving a total of 371 patients. We see a dramatic increase in the median PFS. Now it's sitting at 24.8 months versus 11.0 months in the control arm. Hazard ratio also improved coming out at 0.74 and now with a nominal p-value that is statistical significant at 0.036 -- 0.037, sorry. These were all very exciting results for our team when we saw this. In addition to these data and looking also where we know that there is the highest unmet need in this patient population, which is in the PD-L1 negative group, our median PFS reached at 16.6 months in patients treated in the combination arm compared to only 3 months in patients treated with pembro alone. We have an impressive hazard ratio in this setting at 0.54 and a nominal p-value of highly statistical significant at 0.006. When we look at the overall survival, we also see a trend that is favoring the Cylembio combination arm. We know that OS is not mature yet, but it is already at hazard ratios equal 0.79. We believe we have a drug in hand, and we are really very excited about seeing this data despite, of course, the slight miss on the p-value in the primary end point. When we look at the totality of the data, and we also include that the safety profile is still having a profile, which is well tolerated with no significant added systemic toxicity, we plan to bring these results to the FDA and discuss the path forward for a potential submission. Let me just spend a few minutes on the mechanism of action and this novel biology that now with these data clearly have shown that the T-win technology platform supports clinical benefit. We have seen this in our Phase III, where we have seen an improvement in median PFS and a trend in OS. The products derived from the T-win technology platform are based on the subcutaneous injection with therapeutic cancer vaccines, and this is based on peptide fragments that are derived from different immune-suppressive proteins. In the case of Cylembio, it's derived from IDO and PD-L1. When we have injected these peptides in the patients, this will activate T cells that have a dual mechanism of action. We call it the one-two punch as we are both targeting the tumor cell and the immune-suppressive cells. So the T cells that we are activating with this vaccine strategy are able to not only kill off the tumor cells but indeed also the immune-suppressive cells that are often providing a barrier to the functionality of the T cells that otherwise could eradicate tumor cells. Removing this barrier is part of what we believe is giving the clinical benefit we see in the patients treated. In addition to this, we also know that we are able to modulate and inflame the tumor microenvironment, so it becomes more immune-permissive and enabling further tumor cell killing by the T cells. I'm very excited to see the readout of our Phase III trial that have shown that this platform has clinical effect also in patients in a larger randomized trial. And by this, we can also look now and see how we are further translating this novel biology with the activities we have here in our pipeline diagram. Cylembio is front and center. We have now the readout of our Phase III trial, and we are as next steps discussing the plans with the FDA here in the fall of 2025 with the intent to potentially submit a BLA towards the end of this year. We are also testing Cylembio in other Phase II trials. And of course, now this becomes even more exciting. We have IOB-022, where we are testing in first-line solid tumors, lung and head and neck, and also IOB-032, where we are testing Cylembio as neoadjuvant/adjuvant solid tumors melanoma in head and neck. And the T-win technology is a platform technology. We have more targets that are coming out. First of all, we have IO112 targeting Arginase 1, and here, we are working to bring this towards target towards IND submission. We are also working on IO170 targeting TGF-beta 1. This is an earlier stage candidate, but we are very excited about what we are seeing so far. And with that, I would like to stop here and then let Qasim, our Chief Medical Officer, take us through the results of the Phase III pivotal trial.

Thank you, Mai-Britt. This was a Phase III randomized clinical trial in first-line advanced melanoma patients comparing IO102, IO103, Cylembio plus pembrolizumab versus pembrolizumab alone. Patients were stratified by disease stage and beta status in 1:1 randomization across the 2 study arms. Patients in both arms could be treated up to a period of 2 years, in line with the approved pembrolizumab every 3-week cycle treatment regimen. Cylembio is administered as a subcutaneous injection to patients getting pembrolizumab infusion on the same visit. A total of 407 patients were enrolled across 100 clinical trial sites globally. We are presenting today the top line results of the primary endpoint of progression-free survival by blinded independent central review. As Mai-Britt already shared in the top line results summary, you can see the PFS curve is separating early at 3 months, and the separation is widening over time. The pembrolizumab control arm has reached maturity and is unlikely to change. We, however, expect to see the combination arm curve of rise at subsequent follow-up and that may further widen the curve in favor of the combination. IO102, IO103, Cylembio plus pembrolizumab demonstrated clinical improvement with a median PFS of 19.4 months versus 11 months, a hazard ratio of 0.77 and a p-value of 0.056. The trial narrowly missed statistical significant threshold as Mai-Britt has already mentioned. We had used an alpha of 0.005 at a preplanned interim analysis last year for overall response rate. Baseline characteristics of this Phase III clinical trial were balanced across the treatment arms and were representative of the real-world population one would expect in first-line advanced melanoma setting. We opened around 100 clinical trial sites in United States, Europe, Australia, Turkey, Israel and South Africa. Majority of the patients were recruited in Western Europe, mainly Caucasians and should meet the FDA's requirement for trial population representing U.S. first-line melanoma patient population. In contrast with the proof-of-concept Phase I/II study, MM1636, in this Phase III clinical trial, IOB-013, we allowed patients with prior neoadjuvant/adjuvant treatment with an IO therapy as well as patients with acral and mucosal melanoma. Regarding the acral and the mucosal population, based on steering committee's recommendation earlier on in the trial, a protocol amendment was introduced in December of 2022 to further limit inclusion of these patients. At the time of the amendment, a total of 24 acral and mucosal patients had been included in the trial, which are part of the intent-to-treat analysis. We did not update the SAP to remove the acral and mucosal patients. IO102, IO103 plus pembrolizumab consistently showed improvement virtually across all subgroups, including in poor prognostic factors like PD-L1 negative, BRAF mutant patients and LDH high patients. Clinical improvement is seen irrespective of PD-L1 status, with numerical benefit in patients with PD-L1 positive tumors with 22.1 months of median PFS in the combination arm versus 16.6 months in pembrolizumab mono arm. And a profound effect was seen in patients with PD-L1 negative tumors with a nominal p-value of 0.006, a hazard ratio of 0.54 and a median PFS of 16.6 months versus 3 months in combination versus pembrolizumab mono arm. PFS improvement was demonstrated consistently across the subgroups with one outlier, the prior anti-PD-1/PD-L1 neoadjuvant patient population, which was allowed in this Phase III clinical trial. These patients, however, were excluded from our Phase I/II MM1636 proof-of-concept trial population. As at that time, this was not part of the standard of care. Note, there are more heterogeneities and imbalances in the small subgroup of prespecified population with PD-L1 positive with anti-PD-1/PD-L1 patients. By removing the subgroup, a total of 36 patients in a post-hoc analysis, the p-value becomes smaller due to reduction of the noise, the trial shows a nominal significance with a P of 0.037, a hazard ratio of 0.74, a median PFS of 24.8 months versus 11 months in the combination arm versus pembrolizumab alone arm. As I mentioned earlier on, a protocol amendment was done to further stop enrollment of additional acral and mucosal patients. If we take that small subgroup of 24 acral and mucosal patients out of the intent-to-treat population, this changes Cylembio plus pembrolizumab median PFS from 19.4 months to 22.1 months versus 11.1 months in pembrolizumab alone arm. Overall survival is not mature at this moment. We see a trend in favor of the combination arm for overall survival hazard ratio of 0.79. This is in line with prior data at this time point with other clinical trials. It is worth noting that even though OS is not mature at this point, similar to PFS, majority of all subgroups with one exception are favoring the combination. We need to wait for the majority of the OS data and hope with our current projections, that it will happen sometime next year. The combination was well tolerated with no new safety signals observed. Safety profile of IO102-IO103 Cylembio, in combination with pembrolizumab is consistent with prior pembrolizumab data with no added systemic toxicity. All safety parameters are balanced across the 2 arms with no significant difference seen in AEs, SAEs, immune-related AEs, patient discontinuations or patient leading to treatment interruptions. Note, as per protocol recommendation, if pembrolizumab was to be withheld for any reason, IO102-IO103 Cylembio would be withheld as well. Injection site reactions were the most common reported local side effects in the combination arm. The vaccine, as I mentioned earlier on, is a subcutaneous injection, and it is given with an adjuvant called Montanide. Montanide is known to cause local irritation and inflammation. Hence, injection site reactions were AEs of interest and were monitored closely in the trial. Injection site reactions were reported in half of the patient population in the Cylembio plus pembrolizumab combination arm. All except one injection site reaction were grade 1 and 2. There was only one grade 3 injection site reaction. All were mild and moderate, were transient and resolved on treatment. I would like to summarize that Cylembio in combination with pembrolizumab demonstrated clinical improvement despite the narrow miss in meeting the statistical significant threshold for the binary p-value. This improvement was observed across subgroups and in poor prognostic factors. Removing the one outlier prespecified prior neoadjuvant/adjuvant PD-1/PD-L1 subgroup in the post-hoc analysis reduces the noise. The trial shows nominal significance with p-value of 0.037, hazard ratio of 0.74 and a median PFS of 24.8 months versus 11 months in combination versus pembro alone. Though benefit is seen across PD-L1 status, we see profound effect in prespecified PD-L1 negative subgroup with a p-value of 0.006. With a favorable safety profile consistent with pembro monotherapy, the totality of the data in benefit/risk gives us confidence in activity of IO102-IO103 Cylembio in combination with pembrolizumab. We plan to discuss this data with the regulatory agency for a path forward and BLA submission within this year. I will now hand it over to Dr. Omid Hamid.

Thank you for that presentation. It's a strong data that was shown here. As you can see, there's a huge opportunity here for meeting an unmet need for patients who require a therapy which is tolerable for a wide range of patients who require treatment that can be given outside of an infusion center. And I believe the early look here in overall survival is promising. If you look at the competitive landscape here, if approved, Cylembio would be well positioned for the treatment of first-line advanced melanoma. When I look at the subset of patients with PD-L1 negative and the progression-free survival benefits, which is striking and look at it in comparison in patients that are non-acral or mucosal, this is a paradigm supportive for vaccine type of a therapy without significant increase in toxicity.

Thank you, Dr. Hamid. Next slide, please. So we will announce our second quarter results later this week. We ended the quarter with just over $28 million in cash. Post quarter close on July 4, we received the second tranche of the debt facility we have in place with the European Investment Bank that was $14.4 million. With the cash we have in hand today, we have cash into the first quarter of 2026, covering several important milestones, including the potential BLA submission for Cylembio this year. With that, we can open the call to questions. Operator, are there any questions?

Thank you. [Operator Instructions] Our first question will come from the line of Roger Song with Jefferies.

Hey, Roger, can you hear us?

I can hear you. Can you hear me? Hello?

Yes, we can hear you.

Yes, Roger, we can't hear you.

You can't hear me?

We are able to hear you on assent.

Okay. Great. Thanks for the update. So a question I have...

We can't hear him here.

Can you hear me now?

Yes. Now we can hear you, Roger.

Okay. Great. Thanks for the update. Two questions. One is the -- among all the subgroup analysis, which ones have been prespecified with the FDA potentially can support the approval? Understanding overall, it's pretty strong across all different subgroups. And the second one is in terms of the OS, how much the wave will be carried for the approval decision for OS as you -- in the previous discussion with the FDA? Is that powered or any crossover design will come from interpretation of the OS?

Thank you, Roger, for the question. I hope you can hear me. This is Qasim. Yes. So to your first question, the PD-L1 subgroup was already a prespecified analysis in the protocol and the SAP. The post-hoc analysis that you have seen with regards to removing prior anti-PD-1/PD-L1 patients is not a prespecified analysis. To your second question regarding OS, at this moment, we looked at OS primarily for the purpose of seeing that there is no detrimental effect, which we can see already a hazard ratio of 0.79. We believe the -- as the majority of the data happens in the next 6 to 9 months, this will be an important additional set of data on top of what we are presenting today.

One moment for our next question. And that will come from the line of Yaron Werber with TD Securities.

A couple of interrelated questions. When we're looking at the data, I believe it's on Slide 17 or actually, it's -- that's one of them. And then in the subsequent slide as well, it looks like it's actually Slide 16, apologies. It looks like most of the benefit is confirmed by the PD-L1 negatives, the PD-L1 positive crossing the one. Any explanation for that? The -- why would a PD-L1 negative patient benefit from pembro? And then secondly, when you looked at the data, did you have a chance to look at the data U.S. versus ex U.S. as well to make sure that the benefit is sustained. And then finally, what's driving the survival benefit? Is it the PD-L1 negative patients?

Yes. So as I mentioned earlier on, we actually see benefit across both PD-L1 status positive and negative. There is a numerical benefit of 22.1 versus 16.6 months in the PD-L1 positive population. And in the PD-L1 negative, you already see that on Slide #16, as was shown 16.6 versus 3. We do know, however, historically, that the anti-PD-1s alone do not show a significant benefit in PD-L1 negative. Prior to this, another Phase III study read out a few years ago, where LAG-3 combination with the PD-1 doubled the median PFS shown with PD-1 alone. We are going to look further into the data and share more details on further subgroups and how this can be interpreted. We do, as you mentioned, see a significant outcome here, which has never been seen before in a randomized Phase III clinical trial. Regarding the OS, as I mentioned, all subgroups in OS are pretty much behaving similar to what we see in the PFS data with the exception of the one clear outlier, which is prior anti-PD-1, which is a very heterogenous population, and imbalance across the 2 arms as well. Hence, taking that into consideration the study outcome in general, pretty much changes significantly in favor of the combination.

Can I just make the point here that this is an early look in OS and other combinations prior required further follow-ups, 3-year to 4-year follow-ups to show the OS benefit? So this is very promising in what you see.

Great. And then do you have any data and just a final follow-up -- on T cell biomarkers in terms of how supportive they are on the activity?

Yes, we will have the data, and we'll share that data in the coming months, yes.

One moment for our next question. And that will come from the line of Sebastiaan van der Schoot with Kempen.

Congratulations on this impressive results. I'm just wondering whether you can maybe position the vaccine plus anti-PD-L1s versus other agents that are currently in the clinic and then specifically also for the PD-L1 negative population because that looks really interesting.

So you're asking for the competitive landscape. So to put this data in the context of other agents being currently developed, is that right understood because it was difficult for us to hear the question, Sebastiaan.

Yes. Yes, that's correct.

Okay. Yes. Thank you. So I think as Dr. Omid Hamid has also shared in a couple of slides before this, we know that the benchmark right now has been mostly around 10 and 11 months of median PFS. So I think in terms of that and the hazard where we have landed, this is quite an encouraging data. We have highlighted the outliers here, which may have impacted the outcome. I think in comparison to the treatment options available, both in U.S. as well as ex U.S., this data gives us confidence that it is going to be another option for patients in this setting.

Yes, I would support that and state that when you see the PFS here in the combination, it's the highest PFS that we've seen with any combination, although early, this is a strong indication for a combination that has no toxicity. And mostly academics like myself have familiarity with toxicity, but in a private setting in an outlier clinic in a general medicine -- sorry, in the general oncology clinic, there is a trend to want to therapies, a, that are easy to give; b, that do not take infusional time; and c, do not bring significant toxicity.

Congrats again on the data set.

Thank you, Sebastiaan.

One moment for our next question. And that will come from the line of Allison Bratzel with Piper Sandler.

Hoping you could just help us understand the potential range of outcomes after you meet with FDA this fall. Are you still thinking a BLA filing is on the table for '25? Or is that more likely to be pushed to '26 when you have OS data in hand? And then just a follow-up on the question about the U.S. -- ex U.S. patient split. It just looks like very few patients were enrolled in the U.S. single-digit percentage. Just do you anticipate that that's going to be an issue in your conversations with FDA?

Thank you, Allison. So to your first question, yes, we are already proceeding with our engagement with the regulatory agency. We actually have a meeting planned with the agency within this quarter. And the plans are to continue with our BLA submission based on those discussions. Regarding the question on the population, I think I did try to highlight that in the earlier slides. We have total 17 patients included in U.S. We opened, as I mentioned, 100 sites globally, 10% of the sites were opened in the United States. We have ended up enrolling patients, which are majority Caucasian Western European patients, I would say, close to 90%, which according to FDA's requirements, it's either patients recruited in U.S. or patients recruited outside of U.S., which are representative of the U.S. population. And we believe that, that will satisfy the agency with their requirement.

I think it's important to impress that these are major centers that see melanoma and physicians who are -- who understand the care of these patients. In the United States, it's harder to do first-line trials, but clearly, in EU, these were very solid centers that did the work.

One moment for our next question. That will come from the line of Mike Ulz with Morgan Stanley.

Maybe just a follow-up on some of the earlier questions. In terms of your prior FDA interactions? Can you maybe just give us a little color around those in terms of the view on the product? And then -- and maybe secondly, is there a potential scenario where the FDA might request you to run an additional study here in melanoma?

Thank you, Mike. So we have had -- as you know, we have an accelerated approval. We have a breakthrough designation from the FDA. We have had multiple meetings throughout the execution of our Phase III with the FDA both on, of course, CMC and other important topics. And we do not see any risk adhering to these parts of our filings. And the last part of your question, I actually -- regarding the future of our activities, we will be discussing the potential submission towards the end of this year with the FDA in the meeting we have scheduled here in the fall. That's the comments to that.

[Operator Instructions] One moment for our next question, and that will come from the line of Emily Bodnar with H.C. Wainwright.

My congrats on the data as well. I guess kind of similar line of questions to the other questions. But is your base goal to still get potential FDA approval for the full population based on the Phase III trial? Or do you see a higher probability of approval in a subset of patients? And if so, which subset might you kind of move forward with? And then on the subgroup of patients who did not have prior PD-1, PD-L1 exposure, it looks like it was a fairly small percent of patients who've had prior exposure. So I'm kind of curious what that looks like in the real world setting and if that's similar to what you had in the Phase III trial?

Yes. Thank you very much. So maybe I'll answer your last question first because we had less than 10% of patients in the trial with prior PD-1, anti-PD-1. The usage in community and academic centers in U.S. probably is around 25% to 30%. That's at least from the literature that we have and from the opinion leaders that we've been discussing with. Your earlier question on the strategy, we will present the totality of the data to FDA with the broader population. And I think as you already highlighted, the subgroup of anti-PD-1 prior anti-PD-1, PD-L1 is only a total of 36. It leaves still a significant number of patients, 371 in total with the data that we have presented. So that's quite convincing at least for us that, that heterogenous group, once accounted for and the noise taken out, provides real confidence in the data. So we will present, obviously, the totality efficacy as well as safety, and that's -- that will be further to the discussion with the agency.

Thank you. That is all the time we have for Q&A. I would now like to turn the call back over to Amy Sullivan for any closing remarks.

We just want to take the opportunity to thank everyone for joining us today. If you have any follow-up questions, please do let us know. Have a good day.

This concludes today's program. Thank you all for participating. You may now disconnect.