Transgene SA (TNG) Earnings Call Transcript & Summary

Hello, and welcome to the Full Year 2020 Financial Results and Business Update Conference Call. Please note this call is being recorded [Operator Instructions] I will now hand you over to your host, Mr. Hedi Ben Brahim, CEO, to begin today's conference.

Thank you, Sensi. I'm going to -- just to say that today, we're indeed with Hedi Ben Brahim, CEO of Transgene, will provide you an update on the remarkable progress we've made in 2022 and the prospect for 2023 and afterwards -- after this, Jean-Philippe Del, our CFO; Eric Quemeneur, CFO; Maud Brandely, our CMO; and Steven Bloom, our CBO, will be available to answer your questions. Before I turn the call over to Mr. Ben Brahim, I'd like to remind everyone that today's discussion will contain forward-looking statements, which are subject to a number -- various risks and uncertainties. [Operator Instructions] With this short introduction, I now turn over the call to Hedi Ben Brahim.

Thank you, Lucie, and welcome, everyone. Thank you very much for joining today's update call. 2022 has been a truly exciting year for Transgene. We have made remarkable progress and build the foundation for 2023, a year that will see us realize a number of future milestones. We have seen and we continue to see a growing interest on both the pharma and biotech and the medical community in the potential of therapeutic cancer vaccines and oncolytic viruses. With our approach based on the right vector, the right target and the right patient population, we are in a strong position to deliver improved clinical benefits and to position our candidates as potential game changers on the current -- to the current standard of care in solid tumor treatment. Before I go through our portfolio of exciting assets, I wanted to highlight that Transgene will be very visible at this year's AACR congress next month. We are scheduled to present 8 posters. We will also have a chance in booth where we intend to share our clear missions in the solid tumor immunotherapy space based on the promising data we have generated to date. Let's start with our individualized neoantigens vaccine, TG4050. What is the status of that project? We are in 2 ongoing Phase I that are generating promising data on TG4050 as a single agent. In these 2 trials, our aim is to extend the remission period of the patients. We have the ability to generate data on TG4050 as a monotherapy. New data were presented at AACR and ASCO 2022, we are very robust and showed potential important advantages to competing approaches. TG40 has been well tolerated, TG4050 is a perfect example of how we apply our right vector, right target, right indication approach. The MVA is a fantastic vector and differentiate from the competition, in particular because we can induce a very broad immune response, mobilizes inmate unity, CD8 per T cell and also memory cells. The vaccine display generates very strong immunogenicity. The induction of immune responses is particularly efficient with 100% of patients evaluated at the data cutoff date, showing a specific filler response. And critically, these immune responses are clearly associated with clinic progression. We are also very pleased this progress data have been validated using ctDNA analysis. Enrollment has been completed in these 2 Phase I trials, underlining the attractiveness of the candidate and the strong support we have received from the trail here involved these studies. In the head and neck cancer trial, almost all patients have been randomized and the last cutoff, which is end of August 22, no patients treated with TG4050 have relapsed while 2 patients in the contra group who have not received the treatment have seen the disease progress. An update on the clinical data will be provided at AACR next month in Orlando. We are also working on the planning for a Phase II trial in head and neck cancer. The data from the Philippe is positive, could be used to file a conditional approval for TG4050. We intend to provide a further full update in the press release on April 18, after our poster presentation at AACR. We will also organize a conference call on the back at AACR, so stay tuned. Now let's move to our HPV vaccine, TG4001. What is the status of the program? TG4001 is our most advanced assets in our immunotherapy portfolio and a great example of the potential of our viral vector-based approaches in the cancer -- in the treatment of cancer. We are in an ongoing randomized Phase II trial, which is designed to demonstrate the contribution of TG4001 plus avelumab versus avelumab alone in population of patients that do not receive prior therapy with checkpoint blockers. We announced late last year that following a preplanned interim analysis, TG4001 plus avelumab was shown to deliver improved progression-free survival compared to avelumab alone. The trial now intends to randomize a total of 120 patients overall, which is a meaningful reduction versus the initial plan of 150. Based on the data we. have seen, we aim to continue the development of TG4001 with a potentially registrational trial to support conditional approval of this novel cancer vaccine in patients. We are already working on the design of this trial. And this scenario is one that we are strongly confident. We can execute successfully. After this complete update on the therapeutic vaccine, what's about the imperative viruses. Well, we have also achieved great progress with our 2 figure candidates, and we have also expanded our pipeline with TG6050, an exciting news for candidate, which is due to our [indiscernible] later this year. TG6002 has continued to demonstrate the attractiveness of our patented virus backbone, which is the basis of our EVO platform. We are very pleased that the clinical work we have done in the last 12 months, TG6002 has clearly shown that our oncolytic viruses could be installed intravenously. That is the key competitive advantage. Regarding the intravenous administration trial, new data was presented at ECMO last year. It has shown that the virus is well tolerated even at very high doses or intensive administration schedules. It is able to reach the tumor, replicate and express its payload that confirms the mechanism of action. We are very happy that further data will be presented at AACR next month. Also, this program is particularly important with regard to our collaboration with AstraZeneca and the company's future developments, demonstrating the efficacy with the intravenous route would consider and extend the potential addressable market of oncolytic viruses. Based on the comprehensive data package that we are putting together; we will assess the best way forward with TG6002 against the background of our overall plan to generate value from our oncolytic virus pipeline. Let's move to BT-001. That oncolytic virus could develop with BioInvent. We have also demonstrated very promising data over the year 2020. In the on-wing Phase I, we assessed IT administration of a single agent BT-001. The initial data was good. We have good safety, we have persistent and replication of the virus in the tumor with expression of the anti-CTLA4 antibody in the tumor, we have first signs of efficacy. And so the last patient is about to be dosed. The plan is then to start the Part B of the Phase I study in combination with pembrolizumab in the second half of 2023, and that is done within the frame of clinical collaboration with MS. This great collaboration with our colleague at BioInvent aimed at demonstrated that Vaccinia Virus are ideal cargoes between immune modulators, within the tumor, restore immune competence of the tumor micro-environment, increase and improve the responses to anti-PD-1 therapy. We intend to communicate data on the single agent part of this exciting Phase I trial in the first half of 2023. Now let's have a few words on our novel and promising oncolytic virus, TG6050. You know it's the latest addition to our clinical stage portfolio. What is the challenge that we're addressing with TG6050? This is the administration of IL-12 at the heart of the tumor, and we want to answer the 2 key questions for the industry. How do we deal with the safety profile of IL-12 and ensure good safety for patients? And how do we make sure that IL-12 reaches the tumor? TG6050 is designed to answer all the concerns because with a selective replication in tumor cells oncolytic virus are ideal cargoes to use the expression of IL-12 in the tumor and only in the tumor. The first patients are expected in the coming weeks. That's an exciting development in non-small cell lung cancer fully capitalizing on intravasation data generated by TG6002. A word on finance. P&L in 2022 is in line with our expectations and reflects the acceleration of our clinical trials. The net cash burn of EUR 22.8 million in 2022 compared to EUR 10 million in 2021, excluding capital increase. At the end of December, we had EUR 26.8 million in cash and cash equivalents. In addition, challenging field hole Tasly BioPharmaceuticals shares revaluated at EUR 14.3 million at the end of December 2022. So the financial visibility is now until early 2024, which means that we can deliver our near-term anticipated milestone. This overview has clearly related the potential of our immunotherapy pipeline, and in particular, our strong belief in TG4050, TG4001 and TG6050. I believe that Transgene has a very exciting future and is well positioned to deliver for all of its key stakeholders. Now we'll be very happy to take your questions.

[Operator Instructions] The first question comes from the line of Brandon Folkes, calling from Cantor Fitzgerald.

Congratulations on all the progress. Maybe just for me, just -- can you elaborate on the -- what we should expect at AACR? I didn't see that you noted that some new data will be released on Phase I on TG4050, is there any expectation how we should look at that data, sort of how should we think to find that data? And then additionally, also on oncolytic virus platform for TG6002.

Sure, I can introduce the answer and know that we are CMO, we complete first. I really would like to remind you that we have 8 posters at AACR. That's quite amazing, and I'm very proud of what the team has done, both at preclinical and clinical level. And indeed, the -- probably the one that we'll hear more about the porters in TG4050 and TG6002, where we already have very strong data. So now it's about confirming and going a step further in the IV initiation for 6002, sorry, and about the immunogenicity and clinical standard of activity for 4050. Maud?

Yes. So with respect to TG4050, we are on the line now with 60 patients. So we will provide in this poster, more data regarding the immunogenicity of our vaccine and about the clinical data we have derive, that's the benefits we have derived from our vaccine. I cannot tell more because, of course, it will be delivered at the moment we are with AACR. Regarding TG6002 to be very specific, so we have demonstrated, as Hedi mentioned, the benefit, the clear benefit of the IV administration that we are also exploring local region and administration, and we will have a poster describing the initiation of TG6002 by using intra-arterial diabetic route in patients with metastatic desolation from colon cancer. So very exciting to initiation and no use for chemotherapy and other products. And on the top of that, of course, as Hedi mentioned, we have a lot of other posters on the research.

We currently have no questions coming through. [Operator Instructions] It seems that there are no further questions. So I will hand it back to your host to conclude today's conference.

I think Brandon has a question, again.

Can you hear me?

Yes.

Okay. So maybe just a couple of follow-ups. On the Phase II trials, the head and neck cancer on TG4050, do you think we will get a flavor for the trial design in the near term? What are you thinking just in terms of communicating a trial design for the Phase II? How conservative do you want to be there? And that's it for me.

Well, as you know, we have, from the very beginning, designed the trial, even in Phase I, randomized design, meaning that from the very beginning, we compare the vaccine used as a single agent after standard treatment, further active treatment, including surgery and [indiscernible] versus observation. And so we can -- we are in a position to determine the rate of relapse in the patients who received the vaccine immediately versus the ones who received the vaccine at the time of relapse. And so the Phase II is quite natural in that setting because we can -- we are considering actually amending the protocol so that we can enlarge the sample size by selecting the same patients. As you know, in that setting, the anti-PD-1 and more specifically, avelumab has failed to show any benefit in the Juan setting. So it's very interesting to propose for the benefit of the patient, new adjourned treatment, which -- and so for that purpose, we will pursue. But by enlarging the number of patients on hold, we will pursue the comparison between the treated -- the patients treated with the vaccine versus observation.

Okay. We have another question now calling -- coming from Dominic Rose coming from Intron Health Research.

This is Dominic from Intron Health Research. I've got 2 questions. Question one is on TG4050. I just wondered whether you think it could be a drug that, at some point in the future is eligible for FDA breakthrough therapy designation. And the reason I'm asking is because of Moderna's mRNA-4157, which recently topped that award? And my second question is on your financial visibility. Apologies if I missed this on the call, but do the Tasly shares, do they count towards the guidance? Or would that be extra runway if you sold those in the middle of the year?

So I will answer your first question and Jean-Philippe will further answer your question regarding our finance. So breakthrough therapy is a very, very interesting designation. And this is something, of course, we will consider as soon as we will get a sufficient follow-up of our patients and demonstrate in a significant manner that we have bring a benefit to the patient versus observation. So this is something, of course, we are considering.

And regarding the Tasly share. So I confirm that the cash guidance that we have provided includes the sale of the share that we expect to occur in mid-'23.

There are no further questions. So I will hand it back to your host to conclude today's conference. Thank you.

Thank you, and thank you for listening to us today and your stimulating questions. To conclude, I believe that we have a very attractive proprietary product portfolio. As a result, Transgene is ideally positioned to deliver multiple milestones in the 12 to 18 months, and we see a key innovator in immuno-oncology space. We are very confident that by successfully delivering our programs and our strategy, we will be able to generate multiple improved treatment options that will significantly improve the standard of care for patients with solid tumor and at the same time create significant values for our shareholders. With this, I would like to conclude today's call. Thank you very much, and goodbye.