Iovance Biotherapeutics, Inc. (IOVA) Earnings Call Transcript & Summary

Hi, everyone. Thanks so much for joining us on day 2 of Oppenheimer's 31st Annual Healthcare Conference. My name is Mark Breidenbach. I'm part of Oppenheimer's biotech equity research team. And this afternoon, I'm pleased to be hosting a fireside chat with Iovance, which is developing autologous cell therapies for cancer. And we're joined by the company's CEO, Maria Fardis. We'll be sure to try to leave a few minutes at the end for Q&A. So I would encourage anyone in the audience who has a question to make use of the question box underneath your video. So thank you for joining us, everyone, and let's go ahead and get started. Maria, for the uninitiated, maybe you can give us a very brief introduction to the company and its core technology platform and a very quick overview of its lead programs.

Absolutely. Thank you, Mark, and thank you for hosting us today. Iovance is a company that is developing cell therapy for solid tumors. The specific solid tumor indications that we have been developing, our TIL product for metastatic melanoma, cervical cancer, non-small cell lung cancer in head and neck. We also have a number of different collaborations for additional indications with a number of academic institutions. To step back and kind of think about what is the Iovance technology, it really is dependent on the patient's own immune system. When we think about why is it that most individuals are healthy and they don't walk around with metastatic melanoma, it's because if a cell is detected in our body which is not healthy, typically, our immune system comes to the site of tumor. And it doesn't allow for it to become a disease. It eliminates it and recognizes those cancerous cells and removes it. So that recognition component is what our TIL technology is relying on. And so given that solid tumors are highly, highly heterogeneous in the nature of their presentation, we rely on our own immune system, and we harvest those cells that came to the site of tumor. We expand them outside of the body or. We rejuvenate the cells and we give it back to the patient. So in a nutshell, that's the core of the technology.

Okay. So I thought it since we've seen a wave of new TIL-focused companies popping up recently, maybe we could start off with a bit of a discussion about intellectual property? TILs, of course, are naturally occurring cells that are harvested from tumors. There's no genetic manipulation involved. So how does IP for this sort of product work? In the eyes of like the patent agency, would it -- TIL product be viewed very differently from some other autologously sourced tissue, let's say, like platelet-rich plasma, for example.

So yes, you're correct in the sense that the cell itself is a patient cell. However, when we take out these cells outside of human body and we put them through a process, and again, we have published on the fact that the product that we are generating is rejuvenated. It has a different profile in terms of their activity and potency. That product at that process certainly can be claimed, and Iovance has done that. So from an intellectual property perspective, we have a very broad footprint, which involves sources of tumor-infiltrating lymphocyte. And it could be tumor. It could be marrow. It could be blood also in case of peripheral blood lymphocytes. The nature of how we preserve those cells may be frozen or it may be fresh. It may be digested or may be fragmented. We also have extensive intellectual property, obviously, around our manufacturing process, which the main product and process that you're using is called the Gen 2, 22-day manufacturing process. But we also have developed shorter manufacturing processes, including Gen 3, which we are rolling into clinic. In addition, we have used co-stimulants. We have talked about selected TIL products, and we are working on genetically modified TIL products. And then we do focus on the clinical settings in patients, subsets of patients, combinations. And you might be aware that we are also developing IL-2 analogs as well as using the original IL-2 with up to 6 administrations. So the process itself and the products that we define, the product that we manufacture certainly can be defined, and that is exactly what we have done. We have also highlighted that these products are, again, different than what the cells were that were initially in the body. We call them rejuvenated. So yes, those can be defined, and we really do have a very broad intellectual property footstep that covers really all aspects of TIL and TIL therapy.

Yes. So do you -- is it fair to say that someone can own the intellectual property covering the basic premise of TIL therapy? I'm asking because I'm trying to figure out how other companies or even cancer centers that have their own in-house TIL manufacturing capabilities avoid infringing on IP.

I think one of the goals that -- when I joined the company, one of my goals was to work with academic institutions that may have a slightly different manufacturing method or way of generating TIL. And in fact, what we did is, as part of these collaborations, we certainly have rights to some of these local manufacturing methods, which could possibly have a different product profile. So it wasn't something that we took like did we actually have a number of extensive collaborations? Of course, our original IP comes from NCI. So we have a lot of rights there. But as collaborations with Moffitt and MD Anderson, part of our collaborations has been having access to certain other methods of manufacturing and other potential definitions of products. So we do have a very broad footprint, which sometimes includes what others may have been doing, and we wanted to make sure that they have access to a company like Iovance and multiple manufacturing platforms and infrastructure. So it's been a great win-win sort of a collaboration, in case an academic institution had a slightly different perspective on TIL product.

Okay. Let's spend a few minutes on the melanoma program, lifileucel. It looks like we're going to get a clinical update from your long-running non-pivotal Phase II cohort at AACR coming right up with 28-month follow-up. And of course, we've seen data from this cohort before. It's not like response rate's going to change from what we've previously seen. And I'm not trying to be dismissive of this update. But what do you think was attractive enough about this maturing data that it was selected for a pretty prestigious oral presentation at a plenary session?

I think there has been a little bit of a shift in general, I think, particularly between treating and academic institutions, treating physicians on academic institutions in a better recognition of what are we going to do for post PD-1 patients. 4 or 5 years ago, when I started at Iovance, then I would talk to melanoma physicians, they felt that post-PD-1 patients are going to be a small patient population. And ultimately, a combination of PD-1s or other checkpoint inhibitors would address these patients. What we really have learned that over the past 5 years that this obviously is going to be an expanding landscape because the patients do well. They live through anti-PD-1s, and they ultimately progress. And so many of them are going to be in absolute need of subsequent therapies. So just to remind ourselves what our patient population was, not only these patients have progressed on anti-PD-1, but bulk of them have progressed on anti CTLA-4. And in addition, they have received their appropriate tyrosine kinase inhibitors. So BRA for AMEC, if they had the appropriate mutations. This really is an unmet medical need. And I just want to highlight that I recognize that the analysts are very on top of the story, but I think it's very much as a remarkable outcome to see after a onetime treatment and 28 months of median study follow-up, we haven't reached a median duration of response. And I remind that this patient population would have had an overall survival and median OS of around 6 to 7 months. So it's I think that the evolution of recognition of this patient population becoming a very large patient population in anticipation in the future as well as the fact that we see a one-time treatment being able to offer patients this durable response perhaps was something that was noteworthy for AACR. It also is maybe important to say that we have, our previous data presentations have been oral at ASCO. So really, whenever we have submitted to a medical conference in the past few years, we really have been sort of getting oral presentation. So this is not any different than we've had an oral ASCO. We've had an oral at SITC before that and now an oral at AACR. One other aspect that may be of interest is we, obviously, AACR being sort of conference that has historically been interested in biomarkers and specific sort of subpopulations or lack thereof. We are going to try and focus on some of the biomarkers and show whether they are predictable response in certain subpopulations or not. So we will have additional information in addition to the long-term follow-up of clinical data. And then one last note, Mark, on -- we did put it into our abstract, deepening of response, particularly after such a long follow-up, is absolutely meaningful. And we did put at least 1 additional CR was noted, but we will show that this phenomena is something that we see even this far out in terms of follow-up. I think that combination of all of that was attractive to AACR.

So giving a response this far out, I mean, is that attributable to TIL? Or is that maybe attributable to mischaracterization of a partial response?

An excellent point as well. It's a little unclear whether what are patients such as this would have been a responder might have been a CR a year, 1.5 years ago. And really, the reason the lesions don't completely resolve, sometimes it's inflammation or it truly is that the response is, in fact, getting deeper and deeper. Different physicians of different perspectives. Dr. C. Rosenberg's perspective is the responses probably showed up fairly quickly after the administration of TIL, but in local inflammation doesn't get resolved that quickly, and it takes time for size of some lesions to go down. And sometimes, it takes out to 2 years. So it's exact mechanism. I don't know if I can attribute, unless someone has done either a biopsy to tell us whether there are, in fact, tumor cells left or some sort of a PET scan. But outside of that, seeing that inflammation is resolving, it means that the body is calming down and seeing a deepening of response is definitely a remarkable observation as well.

Yes. Okay. So I think everyone in the audience is probably going to be aware of lifileucel's BLA process and the skid bump you hit with the applications CMC module. Can you give us any status update on that? And when you reach an agreement with the FDA, would you kind of immediately communicate that news to the Street? Or is it possible we'd simply get notification that the BLA has been accepted for review?

Really good topic. So just for -- as a sort of a broader answer to make sure everyone's on the same page. TIL products are released by a potency sort of a matrix of assays, potency is being one of them, identity total viable count viability and austerity or other characters. And under each one of these, there may be multiple assays. The discussion around potency started with the agency a few years ago. And where we are is we are working on 2 sets of sort of assays. The very first set of assays is really good standard release assays, potency assays that has been in literature extensively or KOLs and advisers all agreed that this is the best assay to define the product. This has been what we have been submitting to the agency. When we met with the agency as part of a Type B meeting in late September, early October of 2020, the agency noted that they had additional questions. And so on that front, we have continued responding to the agency, and we have provided the FDA our responses a few months ago already. We have not heard back from them on our responses. We have not received either feedback or additional questions. As part of this meeting, we also offered additional assays that had been part of our characterizations, and we have again provided that information to FDA. Over 1.5 years ago, we offered to FDA to continue with validation of these additional assays and provide that information to FDA as well. We have actually completed our validation work, and we expect to provide this information to FDA in the coming weeks. So once all of this is before the agency, we have no additional action items on our side, and we really do look forward to hearing back from FDA on their position, whether this is adequate information to define our TIL product. I highlight that FDA is not on a clock at this point in a pre-BLA landscape. They are not on a particular clock. So we respect that and we understand that. In terms of what could be the outcome, your other question was how are the investors going to hear from the company, it really depends on what is the outcome. I mean the feedback needs to be very clear before we are able to communicate to our shareholders. If the feedback is clear beyond what we have communicated one way or the other, we certainly can communicate. But if the feedback is additional questions or dialogue continues, I don't know what we can add to the discussion because that is what we have already press released. If things are extremely clear and we end up being able to move to a BLA, you could hear that it has to be filed if we don't have anything else to say. But we do commit to being very transparent. If something meaningfully clear comes from the agency, we certainly will, a priority communicate that.

Okay. We appreciate that. So one lesson we've learned kind of from the collective view of many different TIL therapy trials, not just in melanoma, but other tumor types as well is that these products tend to work best in early lines of therapy, especially in PD-1 naive patients. Nonetheless, we're expecting lifileucel's label in melanoma, at least, will be in a post PD-1 setting. And label expansion into a frontline setting doesn't seem to be a priority right now for Iovance, at least in melanoma. I'm curious what's driving this calculation? Is this based on kind of the pharmacoeconomics and maybe financial toxicity associated with TIL versus pembro? Or is it something else like the relative safety profiles of these drugs?

We actually are very much interested in early line in melanoma and in fact, do have a cohort in our basket study in our COM-202 study, which is TIL plus KEYTRUDA, in PD-1 naive patients. So we are very much interested in that. And I think that you're completely correct in the fact that TIL is best in early-line therapies. Just to remind, we are running, in fact, 4 different cohorts in different studies in melanoma, in cervical, in head and neck and non-small cell and combining TIL plus KEYTRUDA in early-line patients. And we actually have another cohort that we recently added in second line for non-small cell lung cancer, where we are combining TIL plus Ipinivo. In terms of -- so yes, we are very interested in early line. I actually -- from a clinical perspective, I do think this would be the best setting for TIL specifically. But generally, immunotherapies do best when the patient's immune system has not been exhausted in general. So that absolutely is a better line of therapy. From a financial perspective, I think that first and foremost, clinical data are the first thing that one needs to obtain to see, are we adding significant value? And what is that value going to be? The value of everything ultimately is driven by the potential efficacy and safety that it would offer. So financial considerations are not sort of the design aspects. We always think about, let's get the data and decide how are we going to now make this more widely sort of acceptable and available to patients. But one consideration, and this just take a hypothetical example since you talked about melanoma, let's say the data in melanoma in TIL plus KEYTRUDA is really remarkable, and we are very excited about it. One can consider combinations and one can also consider a PD-1 knockout TIL, a genetically modified PD-1 knockout TIL, which could possibly behave as TIL plus KEYTRUDA from a clinical perspective. So I think there's a lot of layers to consider. I don't think that from a drug development perspective on my sort of side, I wouldn't want to think about the financial impact as decision-making. We should resolve those. But if there is efficacy and safety that is tolerable to patients, those are then subsequent questions. If there's not enough efficacy, there's no problem to be solved to begin with. So it's -- for us, it is very interesting, and we absolutely are going into those combinations in early line. In terms of -- you briefly also mentioned potential overlapping safety concerns. We actually have not seen overlapping safety issues, and we did present this data for our head and neck indication when we had TIL plus KEYTRUDA in PD-1 naive patients. There's been other studies as well, where TIL has been combined with various shakeout inhibitors. And there does not seem to be quite -- at least as of the data we have right now, it doesn't seem to be exactly overlapping safety. Of course, larger number of patients are needed before we can draw broader conclusions. But this is just the preliminary observation we have to date.

Okay. So it sounds like at least one of the cohorts in the basket trial could be eventually the basis for a label expansion into a front-line setting in melanoma, depending on how the data was.

Absolutely. Absolutely. Absolutely. And we start from these type of single cohorts to see -- of course, we don't -- there's no data. We are in a completely unknown territory at this point. What is the ORR? What is the DOR? What is expectedly maybe? I know PFS and OS are not exactly meaningful endpoints for single-arm studies, but we certainly look at those to decide, is this something we can go into a Phase II randomized, III randomized, and these endpoints are going to be successful or not. So yes, absolutely, and we already have gotten gears in motion in all the indications in early-line combination settings.

Okay. I wanted to give you a chance to comment on data from some of the competing TIL products in melanoma that have recently emerged. And specifically, I'm talking about there was a 67% overall response rate that Instill Bio saw in their -- with their version of TIL in a 21-patient melanoma trial. And I'll just like to try and make cross-file comparisons whether it's appropriate or not. But I'm curious if anything stood out about the -- I'm assuming you're familiar with this data, and I'm curious if anything stood out about the patients that are treated in that trial versus Iovance's melanoma trial? And is there anything in there that might confound sort of a direct comparison?

Yes. So first of all, I'm really pleased to see in other hands that TIL is giving as noteworthy response as Steve Rosenberg or in our hands. This is exactly what we think TIL is able to do. So no question, this is exciting data from my perspective. I don't have enough visibility to the specifics of the patient population in terms of the details of what line they are and what their prior therapies are or how long they have been on those prior therapies. Are they really progressers or they have just been exposed to prior therapy? A lot of times multi-institution data may be very different than a single-institution data. So there's a lot of layers. And you're correct, that it's very difficult to compare across studies just because the patient populations are different. I really can only speak to our patient population. We define them as not only having received prior, for example, anti-PD-1, but having progressed on those. And we have been showing that data that 100% of patients have received for anti-PD-1, 99% had progressed. 80% of the patients had received [indiscernible] CTLA-4, although that wasn't a requirement, but that's what the nature of today's patients are. And most of them had progressed already on their anti-CTLA-4 therapy. They have progressed on their BRAF MEK. So it's -- and then their baseline disease burden was quite remarkable at around over 10 centimeters summary of diameters, highly metastatic patient population with over -- about 80% of them having more than 3 lesions. So it is a very advanced patient population that we are treating. But I definitely agree that when we have earlier-line patients, and again, this is very much aligned with Dr. Rosenberg's observations. Dr. Rosenberg have reported various response data, but the most conservative ones were 55%. He had other studies with smaller sample sizes where he was seeing 60%, 65% response rate. So I completely agree that TIL is capable of giving a very deep, durable response depending on the patient population. I think one of the things we're seeing nowadays is -- and again, this is commonly seen in multiple sponsored studies. The more we're seeing patients sort of expose to anti-PD-1s, the more we are seeing that they are difficult to treat with subsequent immunotherapies, not just TIL, but we're seeing them sort of being difficult to treat with other immunotherapies. And most people are not doing a single immunotherapy subsequent to progression on anti-PD-1. They do combination. Iovance is pretty much one of the only few that is doing a single regimen, single sort of type of treatment, a subsequent anti-PD-1. Most others are doing combinations, as is appropriate because these patients are very, very sick. The reason we are focusing on [ late 9 ] is, as you noted earlier, is not because we think this is the best positioning for TIL, but this is the cleanest path from a regulatory perspective.

Okay. I appreciate that perspective. I want to touch on your development plans in lung cancer, since this has been a hot topic lately. You've initiated a potentially pivotal trial in lung cancer, which is exclusively focusing on patients who have filled prior front-line therapy with a PD-1 antibody combined with chemo. This population, of course, is distinct from the types of patients that are being enrolled in the -- I think it's the 3 different cohorts in the basket trial, 1 cohort in the basket trial. How should we be interpreting this mismatch? And why commit to a potentially pivotal lung study in a population where your product has yet to demonstrate proof of concept?

Yes. So the lung patient population not only it's large by numbers, but also it's fairly fragmented. And if we think about sort of how to break these patients, you can think about 2 ways of breaking these patient populations apart: by line of -- by number of prior lines of therapy. So 1, 2, 3 more. Or by the nature of the patients, which may be oncogene driver patient populations. And so typically, there are prior lines with first line would be, for example, a TKI, and they may receive TKI 2 to 3 times. And then you can break those -- the rest of the patients down by PD-L1 status, PD-L1 high, PD-L1 mid-level and low. So the reason you're seeing sort of -- I wouldn't call it a mismatch, but we really are covering this the lung space. There are different cells in this grid as we think about first line, second line, third line versus patients with TKIs, PD-L1 high to mid and PD-L1 low levels. And we are offering different solutions for different patient populations. So yes, you're seeing those being different because the patient population is so broad and so differently treated depending on which subpopulation we are dealing with. In terms of our pivotal program, the LUN-202, the strategy we have taken is very similar to the strategy we took in melanoma. The strategy we took is we defined unmet medical need patient population as post chemo immunotherapy for specifically for LUN-202. So it is an unmet medical need and their available care would be really docetaxel with a 9% response rate. And then what we did is, statistically, we did a couple of things. We are -- we have 2 cohorts, cohort 1 and cohort 2. One is PD-L1 low expressers or 0 expressers and one is mid- to high expressers. We are looking at those to see whether we see different response rates into 2 cohorts. Statistically, we have the option, the Simon 2 stage. So we have the option to expand each of the cohorts or not, if we don't see appropriate response rate. We also have the opportunity to possibly combine the cohorts again, statistically, if they have very similar response rates for a potential registration supporting program. And if we don't see an appropriate response rate, we have the opportunity to close the cohort or a study if this is not supportive of registration. So it's very much the same strategy that we used in melanoma and cervical. It's a very gated strategy. We only expand if we see what we think could be supportive of a registration. We also engage agency to make sure that this is appropriate. And if and when it is, then we expand. And if it's not, then that's fine.

Okay. So I'm trying to be sensitive to time here, and I think what we're going to do is move to the lightning round. Basically, you have a couple of very late stage products, maybe possibly 2 BLA filings on the near-term horizon. I feel like investors sometimes lose sight of all of the stuff that you're doing to try and make teletherapy work even better. And what I want to do is go through a list of some technologies or approaches for potentially improving the clinical profiles until and maybe you can just quickly weigh in with your views on whether or not you think any of these approaches could move the needle in terms of efficacy or even just improving safety? Okay. So first, shifting TIL to an earlier T-cell phenotype. Is this a hypothetical benefit? Or do you think T-cell phenotype really matters with respect to efficacy in patients?

There has been a lot of literature around phenotype as well as sort of youth markers. In fact, our Gen 2, for example -- and maybe I'll go back to history for a second. Rosenberg started the till process with a 12-week manufacturing period. And then over the course of about a decade, they move to about 6 weeks manufacturing process, which is what Iovance had initially licensed. That 6-week manufacturing process was called a young TIL. Because till when he shortened the manufacturing process, he was seeing use markers and a better set of sort of products. So as we went to our Gen 2 manufacturing product, we were seeing even better improvement compared to the 6-week long manufacturing. So just to kind of quickly answer the question, we do see better use markers. A great example of what we see as, for example, in our Gen 3 and Gen 2 itself compared to Gen 1 had better use markers. Gen 3, which is a 16-day manufacturing, has even better sort of rejuvenation markers. So the clinical response, ultimately, we are moving into melanoma. So we should be able to see whether that clinically translates to anything or not.

Okay. And staying with the lightning round, what about better selection for tumor reactive T cells and fewer by standards?

And we are also moving a very similar product into clinic, both in melanoma and head and neck. So we will see whether that translates to clinical outcome is well or not.

What about selecting for the right target antigens? For instance, antigens that evolved early in the tumors of patients rather than those that popped up later and might not be present across all tumor cells?

I'll do my best to answer in about a minute, but that's a very big discussion. So typical discussion around truncal mutation, for example, has been an ongoing discussion. Some improvements have been really seen -- really, I'm aware of bladder, but it hasn't necessarily translated to all indications. It may be that we really need to identify who those [ Trinco ] mutations are, and that's not necessarily always easy, and then decide whether that clinically translates or not. So there's a lot to be learned in that space still.

Okay. And finally, armoring TIL against hostile tumor microenvironments with very genetic manipulations, anything promising there?

We are very interested. I could tell you. And that this is part of our talent technology work that we are doing in genetic modification of TIL.

Okay. You know what? We have officially reached our time limit, and that was very nice. I think we had some exciting clinical and regulatory updates to look forward to in 2021. Maria, thank you so much for the discussion, and thanks to everyone in the audience for listening in. Feel free to disconnect at this time.