NextCure, Inc. (NXTC) Earnings Call Transcript & Summary

Good day, and thanks for standing by. Welcome to the NextCure Investor and Analyst Oncology Pipeline Update. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the call over to Mr. Tim Mayer, Chief Operating Officer at NextCure. Please go ahead.

Thank you, operator. Good afternoon. My name is Timothy Mayer, Chief Operating Officer. Welcome to NextCure's virtual R&D update conference call and webcast. You can also join this conference call on NextCure's website at nextcure.com. We're using slides to accompany our remarks today, which also can be accessed from the Investor Relations section of our website. A replay of this conference call will also be available on our website following today's presentation. I'd like to introduce NextCure's President and Chief Executive Officer, Michael Richman; our Chief Medical Officer, Dr. Han Myint; and Dr. Roy Herbst, a key opinion leader in lung cancer from Yale University, who will also provide remarks today. Michael; Han; Steve Cobourn, our Chief Financial Officer; Sol Langermann, our Chief Scientific Officer; Dr. Herbst and I will be available to answer questions as needed. Before I turn the call over to Michael, I'll remind you of the following safe harbor statement. The matters we are discussing today include projections or other forward-looking statements about the future clinical, preclinical and operating results, research and development goals and future financial performance of NextCure. These statements are estimates based on management's current expectations and involve risks and uncertainties that could cause them to differ materially from actual results. We refer you to risk factors discussed in our filings with the SEC, including our annual report filed on Form 10-K for the year ended December 31, 2020 and in NextCure's other filings with the SEC. These filings identify important risk factors that could cause actual results to differ materially from those in our projections or forward-looking statements. We undertake no obligation to provide any updates to these forward-looking statements even if our expectations change. Now I'll turn the call over to NextCure's President and CEO, Michael Richman. Michael?

Thanks, Tim, and good afternoon to everyone. Thank you for joining the call today. Following our updates at SITC, we thought it was an opportune time to host a call and provide further information on our programs and the company. This slide is a brief summary of NextCure's highlights, which focuses on what we call the 3Ps: our pipeline, our product strategy and our people. In particular, we will be providing updates on two of our lead programs today, NC318 and NC410. I guess, you've been hearing a lot about these candidates over the last few days. Also, we have a third program, NC762. That is currently in Phase I and working its way through the early dose escalation cohorts. We look forward to providing an update on the clinical data in mid-2022 for this program. In addition, we have continued to push forward our research and development, and we are pleased to introduce a new program today. We call this NC525. NC525 is based on strong science and aligned with our focus on developing next-generation immunomedicines to treat cancer and other immune-related diseases. It also builds on our understanding of layer biology. To learn more, preclinical data will be presented at the upcoming ASH meeting next month. From a product development standpoint, we are applying a triangulation strategy that focuses on 3 aspects: one, patient selection to increase the probability of success; two, biomarkers for detecting immune activity; and finally, three, evaluating combination approaches. Finally, the last P, people, include our team of professionals, including our fully integrated GMP manufacturing group responsible for producing clinical material to support our 3 ongoing trials. This next slide shows the breadth of our current pipeline, which has occurred in a bit over 5 years. In fact, by the end of next year, we expect to file yet another IND for our fourth program, NC525. More on that later. Given the continued productivity of our discovery efforts, we also anticipate filing yet another IND in 2023. Finally, our discovery platform continues to generate novel targets and we look forward to disclosing additional programs in the future. So let's touch base briefly on today's agenda. In terms of today's agenda, our CMO, Dr. Han Myint, will be discussing the recent updates on NC318 and NC410. I am also excited and pleased to introduce our collaborator and friend, Dr. Roy Herbst, who will be speaking on the unmet medical need in lung cancer today. Lastly, I will provide a brief introduction on NC525 and some additional closing remarks. I will now turn it over to Han to provide an update on NC318. Han, take it away.

Thank you, Michael. This slide shows the previous Phase I and Phase II design. On the left, I will remind you that the Phase I portion of the study with 49 patients has been reported previously at the SITC 2019 conference. The original Phase II study consisting of 4 cohorts of non-small lung cancer, ovarian cancer, head and neck, and breast cancer were depicted on the left-hand side in the bottom half. We treated those 47 patients with 400-milligram of NC318 every 2 weeks and a Simon 2-stage design. Now let me draw your attention to the right-hand side. Today, we are going to report composite data of the Phase I and Phase II, including the disease control rate and biomarker finding. The lesson that we learned from the Phase I and Phase II gives us the confidence to change the protocol to enrich patient population using S15 staining, alter the dose of NC318 to 300 milligrams every week to increase drug exposure and return to non-small lung cancer. Now in this slide, I want to show you the historical clinical outcomes from the Phase I and Phase II. You may recall that we reported previously in the Phase I study, one CR and one PR amongst the non-small lung cancer patients. We also remember that we showed you in the Phase II part of the study, there were 2 PRs reported, including one head and neck and other with triple-negative breast cancer. Today, however, I want to concentrate on the 28 patients with stable disease, 18 from the Phase I, 10 from the Phase II and the progressive disease survival together with the biomarkers such as S15 staining, PK and PD data and soluble S15 levels. Here, assuming similar plot depicts the time to and the duration of disease control. We are also showing you in color-coded fashion, so that you can see the important diseases clearly. I want to draw your attention to the top colors. You can see that, that represents lung patient population. And the top 2 rows that you can see that the CR patient and the PR patient with lung remain on steady at 2.8 and 2.3 years, respectively. There are a total of 28 stable disease patients that I mentioned earlier, and several of those stable disease patients have the duration longer than 6 months. Now we will show you next 3 slides, the analysis of all patients. First of all, I want to draw your attention on the disease control results. Disease control is defined as CR and PR and stable disease together. And all patients that we have treated in the Phase I and II, we have 37% disease controlled rate. We also tabulated for the other diseases as well. Notably, however, in the lung cancer population, the disease control rate is highest at 45%. That also gives us the confidence to return to this indication. More importantly, progressive disease survival is around 5 months in all cancer types. This Kaplan Meier curve depicts the progression-free survival. And you can see clearly that CR and PR group at 18.5 months, the FD group has 4.5 months and progression disease group is 1.7 months, respectively. It is critical to point out that this is the totality of the patients, and it is a mixture of those visions with S15+, S15- as well as those with S15 unknown status. I'm going to show you a few more slides about the analysis of S15 phase. Here, we treated a total of 96 patients. Among them, we have 39 biopsies available for us to do immunohistochemistry to stain for the clear valid data S15 staining. And this is -- remember, this is a retrospective analysis. As I also remind you that biopsies were not available for the S15 sale for the CR and PR patients. However, there were 15 biopsies were positive for S15, 24 were S15-. More importantly, I want to draw your attention to the bottom-left and right of the slide. Amongst those patients with S15+, 40% of them achieved disease control, whereas only 12% amongst the S15- achieved disease control. Now I want to show you the soluble S15 changes associated with the NC318 dosing. As you can see from the graph, after NC318 is given, a soluble form of S15 in the serum increases within 24 hours. It does increase by several folds from the baseline. A couple of points I want to make. Progressive disease was seen in patients with a higher fold increase of soluble S15, 24 hours after the post infusion. We also noted that in the preliminary data suggest that progressive disease may also correlate with a higher baseline S15 level prior to treatment with NC318. We will be collecting more data prospectively in the currently amended protocol. And it may determine that low baseline level of S15 prior to NC318 treatment could be a means of optimal selection for patients in the future. In short, soluble S15 may serve as the NC318 biomarker for patient selection as well as monitoring in the future. Here, I will show you the reason for us to increase to 800-milligram every week. This is derived from the PK/PD modeling showing that NC318 at 800-milligram every week would result in tenfold increase in the drug exposure, as shown on the left-hand side of the figure compared to 400-milligram every 2 weeks in the Phase I and II study as shown in the right-bottom of the figure. By increasing the dose to 800-milligram every week may impact the overall drug exposure as well as clinical outcomes. So here, I would like to summarize the learnings from the Phase I and Phase II studies. As I showed you earlier on, disease control rate, even at 400-milligram every 2 weeks amongst the lung population, was 45% with the medium progression-free survival around 5.2 months. If we look at across all tumors, we have 37% disease control with the medium progression disease survival of about 5 months. We also showed you that S15 selection could enhance vision outcomes. And we also learned from the PK/PD modeling that 800-milligram every week will result in tenfold increase in the drug exposure. That led us to come with the final conclusion that we have amended our protocol as follows: number one, we're going to select patient by S15 after the staining using clear validated assay; number two, we're going to increase the dose 800-milligram every week; and finally, we're very happy to bring back non-small lung cancer as an additional cohort into this study, together with head and neck and breast cancer. I'd also like to remind you that we are collaborating with Yale University on an investigator-initiated trial, where they are conducting a 3-arm study in non-small lung cancer. It gives me a great pleasure to introduce Dr. Roy Herbst, who will speak about the unmet medical needs in treating lung cancer patients and provide a high-level overview of Yale's trial. Roy?

Thank you, Han. There's still significant remaining unmet need in the treatment of lung cancer. Clearly, novel therapies are needed. We need more personalized immunotherapy for this disease, especially in resistant settings. Siglec-15 was identified as a novel immunosuppressor and potential target for normalization in cancer immunotherapy. Here at Yale, this target was characterized extensively through a collaborative effort between Lieping Chen and colleagues at Yale and NextCure, and I've been fortunate to have worked with them. It was identified through screening an extensive gene library from molecules that modulate immune activity and a platform first developed in Dr. Chen's Lab and later expanded to NextCure. As you see on this slide, the target is expressed in both tumor cells and macrophages in the tumor microenvironment, and has structural similarity to PD-L1 and potentially suppresses T cell activity. NC318 was developed by NextCure as an antibody against Siglec-15 that blocks immune suppression and restores immune function leading to antitumor responses. You can see that this swimmer plot depicts the time to and the duration of disease control for the lung cancer patients in the Phase I and Phase II trial. Note, two lung cancer patients remain on study at 2.8 and 2.3 years, respectively. In addition, some stable disease remains on study for greater than 6 months. NextCure has developed a CLIA validated diagnostic assay to select Siglec-15 positive patients. The antibody used in the test was identified and characterized through a close collaboration between NextCure and Dr. David Rimm's lab here at Yale. Based on the data Han just showed you, Siglec-15 positive patients had a higher disease control rate than the Siglec-15-negative patients. Therefore, selecting Siglec-15 positive patients for treatment could enhance the likelihood of providing overall clinical benefit to patients treated with NC318. NC318 has been well tolerated across multiple dose levels. Adverse event profiles are consistent with other approved immunotherapies. NC318 has shown encouraging single agent assay tumor activity. PD-1 refractory non-small lung cancer arm has shown 1 CR, 1 PR and stable disease in 13 patients of 32 are valuable, with a median progression-free survival of 5.2 months. Durable stable disease was seen that's greater than 24 weeks observed in multiple tumor types. Phase II enrollment is underway with a revised protocol using 800 milligrams every week in S15 positive patients. Yale is currently a collaborator in a Phase II investigator-initiated trial of NC318 in combination with pembrolizumab in patients with non-small cell lung cancer. We anticipate results from this trial, which is ongoing in the first half of next year.

Thank you, Roy. Let's move to the second program, NC410. Now let me introduce you to the players in the layer biology, starting from left to right that you can see, LAIR1, LAIR2 in the middle, and NC410, which is our molecule, which I'll explain to you in a minute. LAIR1 is the immunosuppressive receptor, which is expressed on T cells and myeloid cells, such as [indiscernible] cells. You can see from the cartoon that it binds to the collagen as well as into the C1q. When it binds to the collagen, this is a barrier to the T cell migration and suppress the T cell activation, and it binds to the C1q, it enhanced the cancer cell proliferation. The cartoon in the middle showing the LAIR2. LAIR2 is a natural decoy. It is produced by human to modulate the LAIR1 mediated immunosuppression. And it also maintain normal immune function and [indiscernible] in humans. It differs from LAIR1 and 2, respect. One, it is foldable; two, it has a great affinity for collagen and C1q. Now let me introduce you NC410. It is a fusion protein of dimeric form of LAIR2. It remodels collagen and normalize the immune system. Here, I will give you a brief introduction of the NC410 design on the left-hand side and the similar plot on the right-hand side. Let's start from the left. As you can see, is the 3 plus 3 design that are 8 cohorts in the study. And as you can see, we are in the middle of the enrollment of this study. The disease consists of advanced metastatic funded tumors. Our primary endpoint is shown as safety and tolerability. We are also looking at efficacy and other extensive biomarkers. On the right, you can see the similar plot that depicts the cancer type as well as the duration of disease control in different cohorts of NC410 with the doses highlighted. What I'm very encouraged from this very early part of the study is the duration of stable disease amongst these patients, and also shown at the bottom of the slide, with the duration in weeks and the different cohorts on the similar plot that you can see. Now I want to introduce you to the biomarkers that we have done and show you in order as C1q collagen-derived fragments, LAIR2, soluble LAIR1 and the number of CD4 and CD8 T cells. Here, you can see that there is a transient reduction in the C1q level on the left-hand figure. But at 2 hours, it started to come back up, and then it stays up after 24 hours. If I draw your attention to the right-hand side that the baseline level of each cycle, it seems to be leveled out nicely. What is the importance of that? Number one, when the C1q is bound to NC410, that shows that it is a target binding at the early biomarker that we can look at. More importantly, on the right-hand side as I've shown you, the returning to normal level implies that there's no safety concern regarding the complement activity in the circulation. Now this cartoon depicts the understanding of ECM remodeling. There are 2 important parts to understand in ECM remodeling. Number one is ECM formation, in other words, fibrosis formation, collagen deposition, whereas ECM degradation is breaking down of those collagens that you can see. So when you form, the degradation is less. When the degradation is higher, the formation is less. So how do we measure that? It is quite easy to measure it on the serum because these serum biomarkers have been published by a few groups. And here, we show you the example. Pro-C3 and Pro-C6 are the markers that we were looking at collagen deposition. When there is an increase in the Pro-C3 and Pro-C6, it is associated with tumor progression. On the right-hand side, when the ECM degradation occurs, there is an increase in the level of the C4G. This C4G is a project generated by cleavage of collagen with Granzyme B and enzyme produced by active T cells that is associated with immune activation. Here, we'll give you an example from 3 patients who have been on stable disease. And you can see from the image that there is a trend in the increased level of C4G, a marker of immune activation. And on the 2 graphs in the middle that you can see that there is a trend in the reduction of Pro-C3 and Pro-C6, which are the markers of ECM formation and tumor progression. And we also show you an example from the NCI poster, the remodeling of the collagen in the non-clinical model that you can see the control and the NC410 and showing the denature collagen staining on the bottom 2 images. Here, we show you the LAIR2 level in the type of blood, in the -- on the left-hand side. As you can see, the LAIR2 level increases in the dose-dependent fashion. One thing that I want to remind you that current assay is being optimized to discern the endogenous LAIR2 and NC410 level. The right-hand picture depicts the baseline LAIR2 level. And you can also see that there is an increase in the baseline LAIR2 level with the -- in the dose-dependent fashion. Here, we show you the soluble LAIR1 in the peripheral blood over time. Unlike LAIR2, soluble LAIR1 does not change over time. We will continue to monitor at higher dose to assess the mechanistic role in reduction of immune suppression. Here, I show you the flow plot from a patient who had stable disease for some time. And you can see very clearly that both CD4 and CD8 cells increases almost double from cycle 1 day 1 to cycle 3 day 1. And left chart, flow plot depicts the CD8 and the bottom one depicts the CD4 that you can see very clearly. The right-hand image or graphic is very important to understand that despite the total number of C4 and C8 have increased, there is no concomitant increase in expression of LAIR1 on those CD4 and CD8 cells. As you know, LAIR1 expression on those cells are immunosuppressive. Therefore, it is important to know that there is no increase in LAIR1 expression on CD4 and CD8 cells despite the total increase in CD4 and CD8 cells on the left-hand side that I showed you. To conclude, NC410 in subject with advanced and metastatic solid tumor is safe and well tolerated with no DLTs up to cohort 5. It is being studied in the higher cohort at the moment. I also show you that NC410 by binding to C1q and collagen, it modulates and reached still immune function by increasing T cells that you saw earlier and also ECM remodeling. I'm going to turn it over to Michael to discuss LAIR Biology and introduce a new program NC525. Michael?

Thanks, Han. As Han has described what we call the ECM, which is the extracellular matrix, not the equity capital markets that many of you are familiar with, but the ECM contains dense collagen. And it's these dense collagen regions that service barriers to immune cell infiltration. Basically, one can envision it representing a lock in preventing T cells for reaching the tumor. Based on existing biology, NC410 has cleverly been engineered to bind the collagen matrix, remodel the collagenous tissue and actually change the architecture of the ECM. This is aligned with the collagen-derived product Han just mentioned. In other words, NC410 acts as a key that unlocks the collagen barrier through remodeling and normalizing the immune system. Over the last few years, we have been studying LAIR1 and LAIR2 Biology to create novel immuno medicines to treat different diseases. Through our understanding of the LAIR pathway, we have applied our tools and immune expertise to now go beyond NC410, which is a LAIR2 fusion that binds collagens, and now into developing a monoclonal antibody against LAIR1 itself. Our new molecule, NC525, is such a monoclonal antibody and specifically binds to LAIR1 to functionally kill AML blast cells and leukemic stem cells. In other words, we have leveraged our understanding of LAIR biology to develop: one, two distinct candidates; two, separate targeting mechanisms; and three, different cancer indications as it relates to focusing on solid tumors versus liquid tumors and in particular, AML. Let me tell you a little bit about our new program, which will be our fourth program in about 5.5 years, NC525, which is a LAIR1 monoclonal antibody. Currently, AML therapies did not differentiate between leukemia stem cells and normal hematopoietic stem cells. Quite interestingly, we took advantage of the LAIR1 being overexpressed on leukemia cells, including leukemic stem cells and being minimally expressed on normal blood cells. And most importantly, the NC525 monoclonal antibody kills AML blast cells and leukemic stem cells, while most importantly, preserving normal blood cells, including hematopoietic stem cells. We will be presenting preclinical data at the upcoming ASH meeting in December and expect to file an IND in the fourth quarter of 2022. I'd like to now have several closing remarks. Finally, I'd like to first thank Dr. Roy Herbst for participating in today's call. Also thank Tim and Han for their presentations, too. And I'd like to just briefly touch on GMP manufacturing. As previously mentioned, we have a fully integrated GMP manufacturing infrastructure that supports our clinical trials. In the era of COVID, this is a strategically important asset to mitigate manufacturing risk affecting the industry as contract manufacturing organizations prioritize COVID vaccine production. To keep up with our own demand, we previously announced that we added additional capacity, and currently manufacture at a 2,000-liter scale. We have utilized our GMP facility to produce all of the material for our clinical trials. In fact, NC318 is in the bioreactor today and is being produced as we speak. As mentioned earlier, our product development strategy has evolved, and we use a triangulation strategy across all of our programs that's focused on 3 key areas: one, patient selection to increase the probability of success. This is in the form of CLIA validated immunohistochemistry assays; two, biomarkers for detecting immune activity, and Han has nicely described soluble S15 in the NC318 program and walked through a number of biomarkers for NC410; and three, combinations based on rational design. Such a strategy is being applied to all candidates in our pipeline moving forward. And now returning to our pipeline slide to highlight the anticipated near-term milestones for our programs, which include: one, providing an update on the NC318 Phase II monotherapy step trial in the fourth quarter of next year; and Yale providing initial data on the combo trial in the first half of 2022. Two, reporting additional NC410 Phase I data in the second quarter of 2022. Three, reporting initial NC762 Phase I data in the middle of next year. And then four, finally, filing an IND for NC525 in the fourth quarter of 2022. In summary, we continue to make progress on all of our clinical programs and look forward to reporting data in 2022. In conclusion, I'd like to thank everyone for joining the call this afternoon. And with that, we'll now open the call for questions. Thank you.

[Operator Instructions] Your first question comes from the line of Alec Stranahan with Bank of America.

I guess, just to start on your approach to AML. Obviously, this is your first liquid tumor study. So are there any unique considerations you're applying for either the design or the antibody or from a formulation perspective? And is it correct to assume that it would be reserved for patients who failed maybe induction chemo and bone marrow transplant, or are you thinking of pushing it for earlier use? And then I've got a follow-up.

Great question. And thanks, Alec, for joining the call. I think I'll pass that question to the key marker expert at the table, Dr. Han Myint. Han?

Thanks, Alec. Great question. So of course, this is the first time we're going to AML here. But just you know that in my whole life, this is what I did for living in academic as well as when I was at Celgene, developed many drugs in AML space. So we -- of course, the difference that what we're seeing here is the expression level of LAIR1 on the leukemic stem cells compared to the hemopoiti stem cell. So what we're looking at is going to be a lot safer than the current regimen that -- available today. Well, as you know, whenever we give treatment, chemotherapy, bone marrow sometimes you mentioned, you wiped up all the normal cells at the same time. And you've got to rescue them in transplant with normal HLCs weighed in the normal chemotherapy, you have to wait for them to recover from the natural HLC recovery tactic. Whereas in the AML, here with our product, we're expecting that the safety will be less. We've done quite a number of preclinical work with the preclinical data with a normal healthy donor cells as well as the AML cells. But only time will tell when you start in the human studies. To answer your first question regarding how do we go after. I think initially, we need to find the first human dose that we're still working on in the lab. But then we start as usual dose escalation to find out the safety dose. And what we were looking at is to go after the [indiscernible] or the [indiscernible] population, the older age group where they can't go for bone marrow transplant. Depending on the results of what we see in the safety, the goal is to move into the early line of therapy on December 3, the normal chemotherapy, so for the invasive chemotherapy regimen. Transplant, we don't know yet at this moment in time, but I think your thinking is absolutely spot on. But I think we'll get more data as we start treating patients.

Okay. That's perfect. And maybe one for Dr. Herbst, if he's still on the line. I guess, how scalable in your view is the S15 selection test, just thinking about transferability of the technique to other treatment centers. And looking ahead to the first half '22 updates from the SPORE study, should we expect that any of the patients from the trial will be S15 selected? I know the study does have a safety built in.

Right. Still here. A couple of questions. While this is an immunohistochemistry. And as you've seen, a great deal of work has gone into developing this assay. Still a work in progress, but I think it's coming along quite nicely. And immunochemistry can certainly be done at the point of care. And that would be one option. The other option is that this could be done at central facilities and sent out. I do think that the early biomarker data that was shown does suggest that we will move towards using this biomarker in the future. Of course, with the current Phase II trial, including the one we're doing at Yale, will further validate this marker with hopefully more responders and stable disease patients versus those who progress. Right now, the trial that we're running, which is the one I could speak for is not selecting because it's our feeling that we still need to gain more information regarding the biomarker, regarding the cutoffs and so forth. But yes, the ultimate goal would be that we could use this in the future to select patients for this drug.

And your next question comes from the line of Jeff Hung with Morgan Stanley.

So yes, the first question is for Dr. Herbst. And I'm wondering, in these patient populations, what kind of PFS do you think will be clinically meaningful? And often in oncology, a lot of attention is given to CRs and PRs. So how meaningful do you find stable disease in these patients and duration of disease control? And then I have a follow-up to the company.

Well, one of the things, of course, is sure, you want to see a PR and there have been some to see that there is clear evidence of activity. That said, someone who's progressing pretrial on nonimmune therapy and then they go on the agent and they stabilize, I think that's quite useful as well. Typically, in the refractory setting, one wants to see a drug have a median PFS in the 5- to 6-month range with that type of durability, of course, tolerated reasonably well. And I think Han showed some of that with some of those swimmer plots where the patients have been on for a long time. I just like to see a few more of them.

Great. And then for the company. You're now dosing patients at the higher 800-milligram once-weekly dose. Can you talk about your expectations on safety at this higher dose and what gives you confidence that there won't be significant increases in grade 3 plus adverse events?

Great. Thanks, Jeff. Han, do you want to deal with those questions and what we saw in the Phase I [indiscernible]?

Yes. Thank you. Thank you, Jeff, for the question. So we have dosed 4 patients with 800-milligram, maybe 2 weeks in Phase I, and we have no grade 3 toxicity at all in those 4 patients. And we also dosed 4 patients with 600 milligrams. And I'm sure you already remember that we showed one DLT with grade 3 pneumonitis and grade 3 muscle weakness in that particular patient in the past. Because of the PK data that we know with our drug, where we look at everything, we thought giving weekly will not have an issue. However, to be safe, and that's always we have to do, after we treat 3 patients, we have to pause for the DLT period. That's what we do. Now we also send the amended protocol to the FDA for their approval. And we were given the -- allowed to proceed with our study. So for that reason, I think we're quite confident that we will not be seeing a lot grade 3 toxicity. But as you know, time will tell. When we treat more, then we have to be cautious and looking at all the safety profile all the way along. So far, and I can say that so far, we haven't seen anything alarming. Did I answer the question?

Yes.

Your next question comes from the line of Ted Tenthoff with Piper Sandler.

A lot going on here. I guess the first question is just with so many things going on, how do you kind of prioritize things? Obviously, data-driven. And so the opportunity to even have NextCure wholly owned combinations. And final part of this would be, how does partnering ultimately fit into your calculus as you advance these programs?

Yes. Thanks, Ted, and nice to hear from you. A great question, with respect to prioritization and our partnering strategy. As you point out, we have full rights to all of our ongoing programs. And as these programs continue to advance and will require additional resources and in particular, input with respect to global expansion from a clinical and regulatory perspective, we're certainly going to need to entertain some strategic partnerships along the way. How we actually position each program or portfolio of programs with respect to partnering activities, is yet to be seen. As you can imagine, we have a very proactive business development team here next year. We're constantly in discussions with both pharmaceutical and biotechnology companies around the world as it relates to a specific program or a group of programs and also as it relates to oncology or perhaps some of the efforts going on outside the cancer space. But your point is well taken. As we move forward as an organization and knowing our discovery platform that acts as an engine to feed the pipeline, we're certainly going to need partnerships along the way to support these programs in the future.

Your next question comes from the line of Gil Blum with Needham & Company.

So the first one about the soluble S15. Is there a potential for some sort of shedding going on here? I'm just trying to understand that the soluble S15 and the tumor expressing S15 are related or correlated.

Yes. Han, would you like to take that question? I know you've been living in the shadows. So I'm sure you'll provide a perspective on that.

Yes. Thank you very much for the question. I'll start it, and I'll turn on to Sol to chime in a bit more. Yes, you're absolutely right in saying that we have done some work in the lab and they're still ongoing, I must say. And it looks like it shed and from the purpose that you can imagine. And this is not new to us, right? It has been shown in many other checkpoint inhibitors as well as with the HER2, which is well known back in probably about nearly a decade ago, right? People have seen this phenomenon. And then in the BCMA world as well that you've seen that is BCM maybe shedded rather from the surface. So we're still doing a lot of preclinical and in vitro and in vivo modeling to understand this and how the functioning is. I think -- I hope I understood your question, but I'll let -- ask Sol to see whether he want to add anything more.

Yes. Thank you, Han. So I think that's a great question. I think there's a lot of evidence for many checkpoint inhibitors that they produce soluble forms of the protein, including PD-L1 and PD-1. But the whole family, including LAG-3, [indiscernible], I mean, basically, all the players that you're familiar with. With regard to the shadow where areas of active investigation, whether it's actually shed or I think another possibility, which rarely relates to what we're seeing in the clinical trials is whether our antibody actually mediates the release of that soluble form which would then further support it's being a very good biomarker. And those studies are ongoing as we speak. And I think will be very informative in supporting using this audio factor as potentially the selection market for those patients.

All right. That's a very comprehensive answer. Maybe another one just on NC410. Is it likely or is there a possibility that NC410 will be insufficient than a single agent to achieve your kind of an immuno activation you guys are looking for? I mean, it does modify the collagen microenvironment. But would you also consider combining it with a checkpoint or an agonist either targeting T cells or RNA cells?

Yes. Thanks. Great question, Gil, Han, you've been thinking a lot about combination of these data.

Thank you very much your question, Gil. So as you know, we already shown you that even at the very early in our Phase I study, we're seeing durable stable disease with a single agent. And we show you all the trends in the ECM remodeling, the T cell infiltration, et cetera, et cetera. So as we go up to the dose that we expect to get a good therapeutic level, we are hoping to see responses in relation to those stable diseases. Nevertheless, because as you just pointed out, and we have done a number of preclinical modeling in-house NCI and the Netherlands groups that we've done, there were 3 different things. And others have shown that combination with checkpoint individuals or other like fusion molecules may be very, very useful and perhaps optimal effect of the drug maybe seeing when we do that. So we are planning all these things. As we go along, we will be presenting those as we go along in the next year. And you may also see the NCI poster last year as well as this year. and they presented their preclinical data using MC38 model and showing the activity when they combine with anti-form with Vintafuse alpha and showing amazing results. And especially in the NC318 model, not only in the tumor is eradicated when the tumor is rechallenged with the same tumor to those animals. And the tumors reject it. And showing the memory T cells might be rejecting the tumor. So very compelling data from the NCI. And so we are definitely considering all these combo studies as I highlighted earlier.

Your next question comes from the line of Ren Benjamin with JMP Securities.

Maybe just to start off for Dr. Herbst. I'm kind of curious what got you excited to get this IST underway? I'm sure you get your choice of a ton of experimental drugs that are out there that are in development to evaluate in combination with checkpoints. Why NC318. And just related to the data that we've seen so far, I continue to be amazed by the long duration of response of those two non-small cell lung cancer patients. Have you seen super responders like this? And do you have an idea as to what could be driving this kind of a response?

So a couple of things. Why did I get excited about this? Well, remember, we're an academic institution, a hospital, and we want to take science to the lab, the best science of the lab, and we're very fortunate we have Lieping Chen here probably one of the top leaders, if not the in the field. So we have some grants, NCI grants, in lung cancer. And in the first 5 years of that grant, while we were studying the standard PD-1, PD-L1 inhibitors, it was quite obvious that the standard doesn't work for 80% of patients. And even those that do respond to those agents in lung cancer still become refractory. So we're very excited about the screen that Lieping did in collaboration with NextCure that called out Siglec-15. So that actually happened under -- our collaboration it was very nice because that gave us some time early on to work with NextCure. And then David Rimm got involved, helping to develop the biomarker. So we've been engaged in following this for quite some time. Certainly, it didn't hurt that the Phase I data were promising with the responders, with the stability of disease. But it takes work. Think about how many years it took to develop pembrolizumab. So we knew that we needed to do more. We needed a trial where we had reliable biopsies. We knew that we had some work to do with the dosing. We knew we had -- we wanted to look at combinations with PD-1 inhibitor pembrolizumab. So we actually did what -- it's really only possible to do it an academic center because we actually brought together and investing at or initiated trial. We were able to partner with Merck who are providing the drug for that. No easy task, I'll tell you. We're working with NextCure and where we're holding the IND for this trial. But it's a very important trial because this trial is continuing to increase the cohort in lung cancer. We're looking at the new dose level. You heard the rationale for that. Here at Yale, I know we can very meticulously get the biopsies. Even in the best of circumstances, sometimes you just don't get a good piece of tissue, but we're getting the biopsies. We're looking at the combinations. And then just to make it even a little bit more exciting, we added a frontline combo of pembrolizumab plus the NC318 because certainly, will this enhance activity in the frontline setting. So we're all very excited. I'm part of a team, Dr. Gettinger here, Dr. Rimm, Goldberg and others. So we've been accruing to this trial and even during what admittedly has been a pretty tough year for medicine and for clinical trials, but we've been doing that. So that's why we're interested. We believe in the science. We're following the science. If you don't file the science here, you're not going to be successful. So there's amazing science behind this. Otherwise, I wouldn't be involved. And now we're seeing what we need to early on, but it needs that careful refinement. So that's why we're working with it, and we're happy to be partnering. Now you asked me a second question. Can you remind me what that was, please?

Yes. About the super responders. Have you -- you're an academic constitution, you've worked with a lot of different compounds. Have you seen this before, even with just the checkpoints? And maybe just your thoughts as to what could be driving it.

Well, like the super responder like the patient who's had the CR?

Yes, the CR and the PR and the length of duration, which I think is pretty profound, unless you've seen this multiple times before.

Yes. I was trained by the late [ Juda Volkman ]. Some of you might remember him and he used to always tell me your first patient will always be your best. And early on in the trial, you see that first patient responded and has gone for a long period of time. Why you have that? We don't know. Wish we had some tissue in that patient to look and see. But again, it speaks to the fact that immune response is multifactorial. It's not just blocking one target. It's whatever else is going on in the immune microenvironment. Might have something to do with the genetics of that patient specific tumor. But yes, we see this from time to time. We actually have just to the PD-1 inhibitors here at Yale, a library of 20, 25 samples from exceptional responders 5, 10 years. And then we have got so many people who didn't go more than a few months and didn't -- or even less. That's a mystery. That's the science we have to unravel. But I would say the fact that we see that, that's the hope. That's the proof of concept that we're moving in the right direction. Now we have to unravel exactly what that is. That's why I do believe the serum plasma biomarker, the tumor biomarkers are going to be so critical. And now, of course, we can file CTDNA as well, and we're going to start doing that as well.

Terrific. Okay. And then just a follow-up for the company. It seems like you're doubling down on the LAIR biology. And I'm just kind of curious, does now going after LAIR1, does it wind up becoming redundant? Have you may be looked at 410 in the leukemic setting to kind of get a sense as to how it might -- how that -- targeting that biology might work? Or do you feel that, yes, they're part and parcel of the same coin, but they're different enough that you really can't take NC410 into hematological malignancies. You need a separate molecule like 525 to interrogate the hematological malignancies?

Yes. That's a great question. And Dr. Herbst mentioned, we're driven by the science. And when we started studying layer biology, we developed a number of reagents that ultimately could be developed as product candidates with respect to our understanding of how best to interact in this pathway. And as we talked about earlier, NC410 and now NC525 work distinctly through two separate mechanisms of action where NC410 is a dimeric version of LAIR2, a fusion protein that focused mainly on binding the ligand as we talked about earlier, remodeling collagen. And that has a much different biological effect versus NT-525, which is specifically recognizing LAIR1 expressed on T cells and various myeloid cells in the context of AML. So again, being driven by the science. We're happy to see that we could see 2 distinct molecules focusing on 2 different specific applications. For example, years ago, when they were developing CTLA-4, you could see if being developed in the oncology setting, yet Auryxia, which is a CTLA-4 fusion protein being developed in autoimmunity. So again, it speaks to the richness of the science and how we leverage our understanding of pathways, target ligands and how to intervene through various structures. Han, would you like to add anything?

No, thank you. You did a great job of explaining. I think I just want to summarize, a very short summary. NC410 binds to collagen and C1q. Remodel the ECM and activate the immune cells to treat solid tumors. NC525 binds to LAIR1 directly, LAIR1 expressing leukemic cells and leukemic stem cells to the direct killing of those cells. So that's the difference between the two. And that's what we are trying to achieve with 410 in the solid tumors and 525 in the liquid tumor. Did we answer the question?

Yes.

Your next question comes from the line of Asthika Goonewardene with Truist Securities.

I'd like to ask Dr. Herbst something, please. Dr. Herbst, to Benjamin's question earlier. You said you're seeing what you need to see early on. I'd like to ask you, what exactly is it that you're seeing, and maybe ask, are you seeing any responses? And I got a follow-up.

Well, what -- I've done a good number of Phase I trials in my day. And what are you looking for in a Phase I trial? You're looking for safety. So we've got that. You're looking for efficacy. And there are responses now in 4 of them, 3 different tumor types. We're seeing some stability of disease. So it's stage 1. It's -- would I love to see more responses? Sure. But realistically, we know that we need to personalize immunotherapy just like we've been spending years personalizing targeted therapy, what I showed in my slide. So I'm just saying that right now, we're at a step now where we need a larger cohort, get the dose. The dose could have a big role here. Get the dose up. Get the biopsies pre and post, understand the mechanism. So that's why we've taken a deep dive here at Yale into it. So that was what my point was.

Got it. Okay. So it wasn't specifically to the Yale study. I was just the extensive Phase I data that's been produced so far.

Right. And yes, just a whole body of work.

Got it. Okay. And then can I just ask, what is your personal hypothesis on the relationship between PD-1, PD-L1 expression and S15 expression? And maybe tell us a little bit more about what specifically, what kind of analogy you're specifically looking for, looking to do in your Yale study to help answer this?

We know that the whole adaptive immuno response is predicated on the fact that interferon is upregulated after PD-1, PD-L1 interaction. And then, of course, through the JAK stat up regulates more PD-L1 and causes the adaptive upregulation of the microenvironment. We actually know that Sig15 as opposed to being stimulated by interferon is actually down regulated by interferon. So initially, we were even selecting high PD-L1, assuming low Sig and vice versa. That's complicated, though, because we know that even though PD-L1 is a reasonably good marker, there's heterogeneity and other problems with measuring it. In our Yale study, what's different, by doing it at a single site, we have a large team that does these biopsies. I'm hoping we'll get more usable biopsies. The biopsies can be sent to multiple places. Some of the sample can go to a central app, some can go to the next secure scientists, some stays here with Lieping in our lab, David Rimm. So we're hopefully getting adequate tissue to answer the pulp panel of scientific questions we want to answer. And then looking forward to having our own experience with this, I think the combination with pembrolizumab, just because a resistant patient, what do you do with someone who's resistant to immunotherapy? Do you stop the PD-1, PD-L1 inhibitor or keep it going with the next drug? And admittedly, the science in this still needs to be developed. We have to see what's happening with S15 and as we move through this. But the sense is that maybe the combination could be effective. So that's why we're trying it in our trial here at Yale. We're also looking at it in the frontline setting as well. Could be that there are multiple pathways involved. One drug is not necessary -- is necessary but not sufficient. So that's why we're doing the combo.

Got it. And so you're looking to do serial biopsies as well, pre and post and further down after treatment as well to help answer these questions?

Yes. We have serial biopsies, exactly. Which as you probably know, are extremely hard to do, and I certainly want to try to do that in a trial that's open if I was doing a 5, 6 site trial. I wouldn't expect that many of the sites will be able to do that. But we can do that here in New Haven. Now admittedly a little harder than usual because of some of the restrictions over the last year, but we're getting back to normal.

Got it. And then if -- the company articulated that they want to present or have this data in the first half, Dr. Herbst, would you like to present this at an ACR and ASCO? Or is your focus to get this published in a journal first?

I think it's a little too soon for me to speculate when the study will be completed. Of course, I always like to publish in journals, and I always like to present. And as soon as -- don't worry as soon as I have something -- or actually it's my group, I'm just the leader of an amazing team with Dr. Gettinger and Goldberg and others. But as soon as there's something worthwhile, we'll get it out. Don't worry. But the sooner the better. But right now, the study is ongoing. We were able to start during this difficult year, and we're accruing. But nothing to report yet. But as soon as we can, we'll try to get it to the best venue.

Your next question comes from the line of Bert Hazlett with BTIG.

One or two just points of clarification. With regard to Siglec-15 expression -- soluble expression, did you comment that soluble expression was correlated with tumor expression and/or macrophage expression, or do we not know that yet?

Yes. Thanks, Bert. Han, do you want to address that?

Yes. So far, I think there is no direct correlation between the tumor membrane staining or the immune staining with the -- in the tumor microenvironment staining versus a soluble factor because, as Sol alluded to earlier on, we haven't completely sorted out where those S15 come -- soluble S15 coming from. And as mentioned earlier to the earlier question, we're doing both in vitro and in vivo model to understand that. Sol, do you want to add anything?

No, I think you covered the answer very well.

And I have a question for Dr. Herbst. Curious about the dosing. If I'm reading this correctly, is the NC318 monotherapy and Arm 1A is at the revised dosing levels? And it looks like the Arm 1B and Arm 2 are at the prior dosing levels. First of all, is that correct? And then secondly, how are you thinking about that, or is that something that's under consideration for a potential modification of the study?

Yes. So -- yes, so when we began the study, we didn't have the information about the revised dosing. That's being done now in the -- as a single agent. And we do plan to modify to do the combination in the same way. And that's under consideration right now. Absolutely.

And just one other quick one. With regard to NC410, were the grade 3 AEs of anemia lymphopenia is seen at higher doses? Did you -- have you disclosed that? And if not, if you would, that would be great.

We have not disclosed that and which dose. The report that we give you is between Cohort 1 to 5, but we have not disclosed which particular group on. But we have not seen that other patients.

And were they generally reasonably well managed, those patients?

Well, that's very easy to answer. I think the lymphopenia patient came in with Grade 2 lymphopenia already, and that went down to grade 3 lymphopenia for transiently and then come back up. So because of the free treatment the patient had from existing disorders for the tumors, the patient was heavily treated with chemotherapy. The other one that you were mentioning regarding anemia, transfusion sorted it out quite easily. So not an issue.

And your next question comes from the line of Tony Butler with ROTH Capital.

Han, just a little LAIR biology, if I may ask. First, is there any evidence that the LAIR receptor on collagen is downregulated in the presence of either LAIR1 or LAIR2. And second, would you -- or is there any evidence or would you speculate that, that receptor is, in fact, shed as well as Siglec-15 at any point in time during therapy? And then just a tangential comment. What do you think -- if Granzyme B is produced from activated T cells, it was my understanding that at least Tregs and the presence of Granzyme B and perforin could actually suppress any activated CD8 positive T cells. And I'm just curious because I'm trying to close that loop of that understanding.

Great question. I think let's go back one step at a time. I mean, you got 3 questions lumped together. So let's start with the first one. So as I alluded to earlier on, LAIR1 expressing immune cells bond to collagen and C1q. So if I borrow the term from Michael, who used to say, Mother Nature cleverly produce LAIR2, which is a soluble form as homology to LAIR1. And those LAIR2 as a soluble form has a better or higher affinity to bind to collagen and C1q. So they go and bind so that give away the LAIR1 expressing T cell to become activated. But in the tumor, however, is not good enough, right? The normal -- endogenously, LAIR2 is not good enough. They have overcome by the immune suppressive state, the LAIR2 may not be overcoming the T cell to be activated. So what we do, we take the LAIR2 and make them with dimeric form as a fusion protean with the SC. So what we get is the more affinity to collagen and C1q. When it binds, of course, then the T cells are activated. As I've shown you with the [indiscernible] platform as one of the example, the CD4 and CD8 GOA. In addition, we also see is there's no concomitant increase in the LAIR1 expression in CD4 and CD8 cells, even though the number increased almost double. So that tells us that the -- whether it's a down regulation or not -- we were expressing those LAIR1 is quite good for us. That means those T cells can be activated and do the job. So to link to that, those T cells then when they are activated, they produce Genzyme B, as you know., And then, of course, Genzyme B come from NK cells as well, right? So when they do that, that's what happened. It breaks down the barrier. When it does, that's where you get C4G, which is the collagen derived product coming out from the Genzyme induced collagen breakdown of collagen 4, and that's what we get. So to sum up the order loop that you asked, I think that's what happened. And LAIR2 secreted by the activity cells. Now how much LAIR1 is shed that you were asking. We don't know that. But if you look at so far in the study, the LAIR2 level, soluble LAIR2 -- LAIR1 level seem to be stable, not going up or down. So we will know when we get more higher cohort and can keep collecting those data, to answer all your 3 cash and lump together, I hope.

And we have no further question at this time. I will now turn the call back to the company for closing remarks.

Thank you very much, everyone. We greatly appreciate you taking the time to participate this evening. And thanks for sharing your questions. Have a nice evening.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.