Lytix Biopharma ASA (LYTIX) Earnings Call Transcript & Summary

Good afternoon, everyone, and thank you for joining Lytix Biopharma's Q3 2026 presentation. We have plenty of encouraging developments to discuss with you today. In recent months, we achieved a significant clinical milestone, advanced our regulatory work, and identified fresh ways to expand the development of rixotemtide. In our Phase II neolipostede study evaluating ruxotemetide plus pembrolizumab before surgery in melanoma, we are delighted that the trial hit its primary endpoint of pathological complete response, and the data will be given as an oral presentation at ESMO IO. We now intend to leverage that momentum as we move into the next phase of development. Three clear priorities define our strategy. To start, we're moving forward on the study protocol, choosing a CRO, and evaluating sites, which will ensure the Phase III program is ready to execute alongside a partner. Next, we're in active talks with prospective partners regarding funding and running the registration study, and the clinical progress we've made recently strengthens the footing for those conversations. Third, in addition to NeoLIPA, the investigator-led study planned for early 2027 will assess ruxotemetide combined with another established immunotherapy agreement; this will let us investigate its potential across various treatment combinations in neoadjuvant melanoma. Taken together, these priorities provide a clear direction for us: push toward registration, lock in the partnership needed to support that development, and continue accumulating evidence for exome potential. So let me give you a quick rundown of what we'll cover today. We'll start with the science — how oxotemitid works and why its mechanism matters especially for pre-surgical treatment. After that, we'll go through our main highlights, and then, yes, we'll share our financial results and capital position before taking your questions. Let me quickly introduce the presenting team. I'm Oystein Rekdal, CEO and Co-Founder of Lytix Biopharma. Joining me are our CFO, Gjest Breistein, and our CMO, Karim Benhadji. Now I'll pass it to Karim, who'll take you through our approach to melanoma.

Thanks. Neoadjuvant treatment refers to therapy administered prior to surgery. For resectable melanoma, the guidelines include 2 immunotherapy regimens as standard of care. The first is nivolumab plus ipilimumab, which blocks 2 immune checkpoints, PD-1 and CTL-4. Two cycles are given before surgery, and further treatment after surgery is guided by how the tumor responded to treatment. The second regimen is pembrolizumab, which blocks PD-1; patients receive 3 doses before surgery and pembrolizumab continues after surgery. These regimens have improved outcomes for patients, but there is still room to deepen responses and prevent recurrence. And that is what we focus on. Ruxotemitide is intended for use in the neoadjuvant setting—that is, prior to surgery—and it operates through three steps. In step one, we administer ruxotemitide through direct injection into the tumor, which kills tumor cells and exposes tumor antigen to the patient's immune system. During the second step, antigen presenting cells take up the antigens, and this primes T cells against the cancer. A checkpoint inhibitor then releases the brakes, allowing those T cells to attack the tumor cells. In the final step, once the immune system has been primed, the tumor is removed, with the goal of lowering the likelihood of recurrence. Timing is the key idea. Ahead of the operation, the tumor remains in place and acts as an antigen source—we draw on the wide array of tumor antigens the patient carries. There's a second reason the schedule is so important. When treatment begins earlier, the patient's immune system responds better than it does in advanced disease. That means it can generate a more powerful immune response. Priming immunity prior to surgery is how we try to capitalize on that. Merck and Moderna are likewise working on antigen right immunity in melanoma with < >; therefore, I want to be clear on how these two strategies are distinct. The Merck/Moderna vaccine consists of 34 antigens chosen through sequencing of the patient's tumor. Ruxotemitide brings a wide spectrum of the patient's own tumor antigens into view. In addition, ruxotemitide is a ready-made peptide that gets injected directly into the tumor, requiring no manufacturing tailored to the individual, whereas < > is a personalized iron product produced for each individual patient. The timing is another difference. The vaccine from Merck/Moderna is administered following surgical removal of the tumor, whereas ruxotemitide is administered prior to surgery, at a point when the tumor remains accessible for injection and immune application. At this point, you can see where our pipeline stands. Atlas IT 05, our study combining ruxotemitide with pembrolizumab in PD-1 and PD-1 refractory myloma, has finished and been fully reported, and it yielded encouraging results. Our Phase II trial in near melanoma, NeoLIPA, tested ruxotemitide combined with < >, and it hit its primary endpoint; those results are going to be shared at ESMO IO this December. That program is now our lead asset as we head toward a registrational trial in advanced in resectable melanoma. ALETTA — a Phase II trial of rexitometide alongside ipilimumab and nivolumab in neoadjuvant resectable melanoma — is slated to kick off in the first quarter of 2027. Together with our partner, we've now wrapped up Phase II work on ruxotemitide in bazacellcarcinoma. And last, LTX-401, the small molecule we have for solid tumors and deep-seated lesions, is getting ready for Phase I, both as a single agent and in combination; with that said, I will pass it back to Oystein for the Q3 updates.

Thanks, Karim. Now let's turn to the main highlights from the quarter and from the period after it closed. First up is NeoLIPA, our Phase II study of ruxotemetide combined with pembrolizumab, given before surgery in patients with resectable melanoma. I'm pleased to say Neolipa met its primary endpoint, pathological complete response, or PCR. What PCR means is that when tissue taken out during surgery is examined after treatment, no viable tumor cells are found. The PCR rate cleared the protocol's prespecified bar for success, which was at least 40%, and there were no new safety signals. We're also happy to share that the study has enrolled all 27 patients. A late-breaking abstract has been accepted for an oral presentation at ESMO immuno-oncology in London on December 15. That represents very strong recognition that we have generated clinical results relevant to the global cancer research community and demonstrates that international oncology experts recognize the study's quality and relevance. Looking forward, ALETTA remains on schedule to begin in early 2027. It is a multi-arm Phase II study in resectable Stage 3 melanoma led by Professor < >. And should it validate ruxotemitide with belimumab and nivolumab, ruxutemetide would then be positioned for combination with both standards of care backbones in the neoadjuvant melanoma setting. Advanta. Dr. Tristan Blank is one of the top authorities on giving immunotherapy ahead of surgery for melanoma, and we feel a great deal of pride in having been asked to join this trial that Dr. Blank leads. Our second highlight involves the feedback from the FDA, which lays out the route to approval in the U.S. According to the FDA, one well-designed Phase III trial could be enough to pursue marketing approval in the U.S., contingent on the overall results. The design we put forward drew no objections from the FDA. That design compares ruxotemitide plus pembrolizumab against pembrolizumab by itself, given prior to surgery in melanoma patients whose cancer carries a high risk of coming back. Since NeoLIPA has reached its primary endpoint, the case for moving ahead into Phase III has grown stronger. Efforts are ongoing regarding the study protocol, choosing a which — the organization that will conduct the trial — and evaluating clinical sites. In its earnings call presentation yesterday, Verrica stated that it is investigating development of ruxotemitide for patients with goal in syndrome. Calling syndrome is a rare inherited condition resulting in an extremely high number of basal cell carcinoma lesions along with repeated surgery. According to Verrica, a proof-of-concept study might clarify VP315's role in multiplatinCC, alongside the continuing BCC program involving more sporadic and fewer BCC solutions. Now to our business and financial highlights. We have achieved progress in reinforcing both our team and the advancement of our technology. In August, Timothy Herpin joined us as Chief Business Officer. Bringing him on board strengthened our capacity for business development as we move our partnering strategy forward and get ready for Lytix's next stage of development. Once the quarter had ended, we were also pleased to be granted NOK 12 million by the Research Council of Norway — a result that speaks to a strong effort by our team. The funding will support efforts to develop the formulation of our oncolytic molecules for intradermal injection, which lets us extend the potential of our platform further. To wrap up, cash and short-term investments totaled NOK 67.3 million at the close of the third quarter. Those funds underpin our continued work on core activities, with attention squarely on the milestones offering the biggest opportunity to build value. I'll now turn it over to our CFO, Gjest Breistein, who will take you through the financial results.

Thank you, Oystein. Before I walk through the figures, I want to explain why Lytix's current position excites me so much and why I have faith in this business. In my role as CFO, I seek validation from outside sources, and this quarter delivered 3 such signals. To begin with, NeoLIPA hit its primary end point, which made it the successful trial. Next, the results were accepted for an oral presentation at ESMO IO. That shows our data are drawing notice from the specialists who count most in this field. Third, the Research Council of Norway, through its IPM program, has granted Lytix NOK 12 million. That process is competitive. This funding doesn’t dilute shareholders, and it supports the new versions of our molecules. Taken together, those data are gaining recognition externally. We make them in a way that uses capital efficiently, and that provides the context for the numbers I’ll walk through now. Operating expenses totaled NOK 27.9 million in Q3, compared with NOK 26.8 million in Q2 and NOK 24.3 million in the same quarter last year. One point needs clarifying in the year-over-year comparison. Twelve months ago, Q3 included NOK 11.8 million in cash — noncash share option costs. This quarter, that amount was NOK 3.2 million. Leaving those out, operating costs came in at NOK 24.8 million, compared with NOK 12.5 million during the same period last year. Nearly all of that increase comes from direct R&D spending — $14.3 million this quarter versus NOK 4.8 million a year earlier; the money went toward getting the Phase III protocol ready, CRO work, site setup, and manufacturing. Net financial items were positive, at NOK 1.8 million. Of that amount, NOK 0.9 million is an unrealized gain on our money market funds that actually belongs to the second quarter and should have been booked at that time. It has no cash effect, and the 9-month numbers are accurate. For this period, the loss came to NOK 26.1 million. Over on the left, you'll notice that quarterly costs rose at the beginning of the year, when we started getting ready for Phase II, and they've remained steady ever since. The largest piece of that is direct R&D cost. Turning to the right, cash and short-term financial investments came to NOK 67.3 million at the close of September, compared with NOK 91.4 million at the end of June. Cash burn during the quarter was NOK 24.1 million, versus approximately NOK 29 million in each of the first two quarters. If we keep spending at the current rate, our cash will carry operations into the second quarter of 2027. Two points alongside that. To start, NeoLIPA and ALETTA are both investigator-initiated, and the sponsor bears most of the cost. Also, the Phase III trial hasn't begun yet. The bulk of our spending is preparatory work, which we manage on a quarter-by-quarter basis. Next, the IP grant is nondilutive funding. It doesn't alter the larger picture, but it's precisely the type of capital we're looking for tomorrow. Our balance sheet is simple. Cash and liquid holdings of NOK 67.3 million make up nearly 90% of total assets, which are NOK 75.8 million. Of that, NOK 54 million sits in low-risk money market funds that we can tap on short notice. Liabilities are now down to NOK 12.1 million, compared with NOK 19.1 million at year-end, and apart from leases we carry no interest-bearing debt. Let me finish by explaining why I have confidence in Lytix; we hold a drug candidate that has reached its primary endpoint. FDA feedback suggests a single Phase III trial could be sufficient to seek approval in the U.S. We have data the oncology community elected to feature in an oral session, and we have established this position with a cost base that remains stable and is focused on the program. Launching Phase III will demand capital past what we currently have. That is the challenge in front of us; yet there is a major difference between raising money to advance a drug with positive Phase II data down a defined regulatory pathway and raising money to discover whether you have one at all. We sit in the first category. Specialist investors and partners track the data. Our data are now attracting their interest; and our task in the months ahead is to convert that interest into the funding this program requires. Oystein will now walk through where this leaves us across the pipeline.

Appreciate that, Gjest. With 2026 winding down, our lead program has solid clinical momentum and a clearer regulatory route; the progress we've achieved is meaningful and gives the company a sturdier base for its next phase of development. For melanoma, the primary endpoint was met in our Phase II NeoLIPA study. In addition, FDA feedback here suggests one well-designed trial could suffice to back a U.S. marketing application, contingent on the overall results. All of this strengthens the rationale for advancing ruxotemitide into Phase III and provides clear direction for our development and partnering efforts. The late-breaking oral presentation of the NeoLIPA results at ESMO in London on December 15 is our next big milestone. That gives us an important chance to bring our data straight to the international oncology community and to help move along discussions with prospective partners. I'm really looking forward to sharing these results. Then, in early 2027, ALETTA will test ruxotemitide in combination with ipilimumab and nivolumab; this adds to our Phase III plans involving pembrolizumab and may expand what ruxotemitide can do down the road across two key treatment backbones in neoadjuvant melanoma. On the basal cell carcinoma side, our partner Verrica is looking into a study of BP-315 in patients who have Gorlin syndrome. People with this condition may end up with numerous BCC lesions throughout their lives and must deal with the burden of undergoing surgery again and again. That opens a possible path to extend the BCC program into a group whose needs are not yet met. Past ruxotemitide, we keep getting LTX-401 ready for Phase I, which brings forward the next opportunity inside our platform. Our strategy is focused — with disciplined use of capital, we are moving the Phase III preparation ahead so the program stays partner ready, while we also pursue discussion about how the study can be funded and delivered. Okay. That brings us to a Q&A session. Yes. So during the past few years, Lytix has grown into a company with greatly reduced risk and a very robust platform. The encouraging results in melanoma have us looking at whether we might move into other major cancer types, such as breast cancer and head and neck cancer; an outside commercial evaluation suggests a potential in the billions of dollars across these 3 indications. Our second asset, LTI, works through the same mechanism, and ruxotemitide's data also reduce the risk for it, with potential to go after cancers located deeper in the body, including liver cancer and lung cancer, and so on. So within just a few weeks, we'll be presenting our data at ESMO; that's a significant milestone for us, since it gives us a real chance to talk it over with oncology experts, meet with partners, and get their feedback on how it compares with other studies. Naturally, receiving an invitation for a late-breaking abstract is a real honor, and it also signals that we possess findings that are both compelling and noteworthy for oncology experts and the broader community. That gives us considerable confidence that we truly are headed in the right direction as we work to develop a possible therapy for future cancer treatments.