CytomX Therapeutics (NASDAQ:CTMX), a company dedicated to the discovery and development of novel cancer medicines, has reported its financial results for the third quarter of 2023, along with updates on its pipeline and partnerships. The company's pipeline, which includes lead programs in antibody drug conjugates (ADCs) and T-cell engagers, is poised to transform solid tumor treatment. CytomX also highlighted its strong financial position, expecting current cash resources to fund operations into the second half of 2025.
Key takeaways from the earnings call include:
- Initial data from the Probody T-cell engagers targeting EGFR and CD3 is expected in the first half of 2024.
- An Investigational New Drug (IND) application for the Probody ADC targeting EpCAM is planned to be filed by the end of this year, with Phase 1 initiation in 2024.
- The Probody cytokine program is advancing towards the clinic, with an IND filing expected by the end of this year.
- Partnerships with Moderna (NASDAQ:MRNA), Regeneron (NASDAQ:REGN), Astellas, Amgen (NASDAQ:AMGN), and Bristol-Myers Squibb (NYSE:BMY) (BMS) provide technical validation and non-dilutive financing.
During the call, CytomX discussed the progress of their collaborations with Moderna, Regeneron, Astellas, Amgen, and BMS, anticipating significant progress and multiple inflection points in the next 12 to 18 months. The company is currently conducting Phase 1a dose escalation studies for drug candidate 904, with plans to analyze the Phase 1a data in collaboration with Amgen and make a decision on Phase 1b expansion into select EGFR positive tumor types.
CytomX also mentioned their work on drug candidate 801, with the goal to file two INDs and initiate clinical studies in 2024. The partnerships with Astellas and Regeneron are progressing well, with milestone achievements and a focus on biospecific immunotherapies.
BMS is conducting proof-of-concept trials in non-small cell lung and MSF CRC for the CTLA program, with data expected in 2024. The company expressed excitement about their partnership with Amgen in the bispecifics field, particularly regarding their CX-904 drug candidate. The progression to the Phase 1b stage in 2024 will depend on the analysis of Phase 1a data and discussions with Amgen to determine which EGFR positive tumors to prioritize.
InvestingPro Insights
Based on real-time data from InvestingPro, CytomX Therapeutics has a market cap of $85.46M and a negative P/E ratio of -2.01, indicating that the company is not currently profitable. Over the last twelve months as of Q2 2023, the company has seen impressive revenue growth of 195.01%, reaching $79.49M. Despite this, the company is operating at a loss, with an operating income of -$40.52M.
InvestingPro Tips indicate that while CytomX is experiencing accelerated revenue growth and holds more cash than debt, it is quickly burning through cash. Analysts have revised their earnings downwards for the upcoming period and do not anticipate the company will be profitable this year. Despite these challenges, the company has seen a significant return over the last week.
These insights indicate that while CytomX is making strides in its cancer research and partnerships, it faces financial challenges. It's important to note that these are just two of many tips available on InvestingPro, which provides a wealth of insights for those looking to make informed investment decisions.
Full transcript - CTMX Q3 2023:
Operator: Good day and thank you for standing by. Welcome to the CytomX Therapeutics Third Quarter 2023 Financial Results. At this time, all participants are in a listen only-mode. After the speaker’s presentation there will be a question and answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Chris Ogden, Senior Vice President, Finance and Accounting. Please go ahead.
Chris Ogden: Thank you. Good afternoon and thank you for joining us. Before we begin, I would like to remind everyone that during this call, we will be making forward-looking statements. Because forward-looking statements relate to the future, they are subject to inherent uncertainties and risks that are difficult to predict and many of which are outside of our control. Important risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future developments or otherwise. Earlier this afternoon, we issued a press release that includes a summary of our third quarter 2023 financial results and highlights recent progress at CytomX. We encourage everyone to read today’s press release in the associated materials, which have been filed with the SEC. Additionally, the press release, a recording of this call and our SEC filings can be found under the Investors and News section of our website. With me on the call today is Dr. Sean McCarthy, CytomX’s Chief Executive Officer and Chairman. Sean will provide introductory comments on entitlements his progress and key milestones before we cover our pipeline progress and financials for the third quarter. With that, I will now turn the call over Sean.
Sean McCarthy: Thanks, Chris and good afternoon, everyone. Thanks for joining us for an update on CytomX continued progress in 2023. At CytomX, we are highly focused on the discovery and development of novel cancer medicines, utilizing our Probody Therapeutic platform to localize potent biologic modalities into deceased tissue via conditional activation, increasing therapeutic index and offering new options for patients. Given the continued challenging external environment for biotech, I’d like to start with an overview of the strong fundamentals of CytomX today with three areas of particular focus, outlining why we believe we are very well positioned as we move towards 2024 and beyond. Firstly, our pipeline. CytomX is active across our pipeline in key areas of current oncology R&D. Two of the biggest highlights recently at ESMO 2023 were new breakthroughs in the use of antibody drug conjugates and T-cell engagers. ADCs and T-cell engagers are poised to be therapeutic platforms with potential to transform the treatment of solid tumors. I am very pleased to say that for many years, CytomX has been building significant expertise across these important modalities and we currently have differentiated lead programs in both areas. Our pipeline has never been more relevant or had more potential. 2023 has been a year of intense focus and exceptional execution for CytomX that has set the stage for key value creating milestones in 2024 and 2025, starting with CX-904, our Probody T-cell engagers targeting EGFR and CD3. Coming out of ESMO last month, there is clear momentum and increasing clinical evidence that T-cell bispecifics can have a meaningful clinical impact in solid tumors. However, a central challenge in this highly potent modality is that the majority of solid tumor targets are also expressed in normal cells limiting therapeutic window. CX-904 is designed to address this challenge for EGFR, which is one of the most highly validated and broadly expressed solid tumor targets. CX-904 has continued to advance through Phase 1 and we are in the process of starting to backfill certain cohorts as we continue dose escalation. We remain on track for initial data in the first half of 2024. Our first-in-class EpCAM targeting Probody ADC CX-2051 is on track for IND filing by the end of this year and Phase 1 initiation in 2024. CX-2051 is an excellent example of CytomX differentiated ability to pursue novel ADC targets. We are particularly excited about EpCAM given its high expression level across multiple tumors, including colorectal cancer and its prior clinical validation as a target for cancer therapy. We presented the full preclinical profile of CX-2051 at World ADC in October and the presentation can be found on our website. We plan to execute on Phase 1a dose escalation through 2024 and data permitting to initiate Phase 1b expansion cohorts in 2025. We have also continued to advance our first Probody cytokine CX-801 towards the clinic. CX-801 is a masked version of Interferon Alpha-2b for which we see enormous potential as a novel centerpiece of cancer immunotherapy in the future. Last weekend, we presented updated preclinical data at SITC. This presentation is also available on the CytomX website. IND filing for this program is also anticipated by the end of the year. Continuing in the field of cancer immunotherapy, our partner BMS is advancing the masked, non-fucosylated CTLA-4 program, BMS-986288 in Phase 2, which includes proof-of-concept studies in microsatellite stable colorectal cancer and in non-small cell lung cancer. BMS anticipates data will be available from this program in 2024. Taken together, our pipeline is deep, strong, relevant, and poised to drive value inflection in the near-term. The second area I’d like to highlight today is our partnerships. CytomX created the field of protease-based conditional activation more than a decade ago and our substantial and consistent investments in our platform technology have allowed us to attract many high quality partners. We currently have alliances with Moderna, Regeneron, Astellas, Amgen, and BMS that each bring value to CytomX in the form of technical validation, increasing the reach of our platform, I am providing non-diluted financing. Together with our partners, CytomX today has more than 15 active R&D programs. In addition to upfront cash infusions from these partnerships and potential future product royalties, each partner program has the potential for near and long-term cash milestone payments. CytomX has a strong track record of earning milestones under our alliances, including most recently, a $5 million payment from Astellas for our first clinical candidate nominated in the collaboration. Thirdly, I would like to highlight our strong financial position. Chris will review shortly how we are continuing to manage the financial resources of the company in the context of the challenging external environment. Before handing over to Chris and continuing on the theme of fiscal discipline, I would like to provide a brief update on CX-2029, our Probody ADC targeting CD71. We have been encouraged by the anti-tumor activity. We have observed with CX-2029 to-date. However, based on current priorities, we will not be directing significant additional investment in this program in the near-term. Now, let me turn the call over to Chris, who will walk you through our financials.
Chris Ogden: Thank you, Sean. I am pleased to be able to share an update on our third quarter 2023 financial results with everyone today. As of September 30, 2023, we had $194 million in cash, cash equivalents and investments, which includes $30 million received in July, as a result of a successful and strategic private placement financing with BVF partners. Overall cash burn in the third quarter was $16.8 million, comparing to $33.9 million in the equivalent period of 2022. The reduction in cash burn for the same period in 2022 reflects our continued focus on discipline capital allocation, and cash management as well as increased R&D reimbursement under our collaborations. I’d also note that our cash balance of $194 million for the third quarter of this year is flat to the third quarter of 2022, which also highlights the company’s ability to balance costs prioritization, business development, milestones, and equity financing to maintain a strong financial position in a very challenging biotech environment. This balanced capital formation and allocation strategy has remained consistent over time and aligns well with our focus to build near and long-term stakeholder value. In terms of cash runway, we expect our current cash resources to fund operations into the second half of 2025. This guidance does not assume any additional milestones from partnerships or any additional progress in new business development. Now moving to revenue and operating expenses for the quarter. For the third quarter of 2023, revenue was $26.4 million, compared to $11.1 million for the corresponding period in 2022. Operating expense for Q3 2023 was $23.3 million. R&D expenses decreased $14 million from the corresponding period of 2022 to $16.4 million during the 3 months ended September 30, 2023. General and administrative expenses decreased by $3.7 million during the 3 months ended September 30, 2023 to $6.8 million, compared to $10.5 million for the corresponding period in 2022. So you can see from these operating expense numbers, how we have continued to thoughtfully manage the company. Now, I’ll turn the call back to Sean for closing remarks.
Sean McCarthy: Thanks, Chris. And thanks to everyone for your time this afternoon and for your interest in CytomX. Looking ahead to 2024 and 2025 CytomX is very well positioned. This is an exciting time for us, and we remain highly focused on delivering in our pipeline. Our current pipeline encompasses highly relevant and diversified modalities, including T-cell engages, ADCs, and cytokines that each have their own unique contribution to make to the treatment of cancer. Let me briefly recap our key priorities and milestones for the remainder of 2023 and through 2024. CX-904 continues in Phase 1 dose escalation, initial Phase 1a data is anticipated in the first half of 2024 with the potential for a decision to initiate Phase 1b next year. 2051 – CX-2051 IND filing is on track for this year. We anticipate Phase 1 dose escalation in solid tumors with known outcome expression to commence in 2024 with metastatic colorectal cancer as a priority indication. Similarly, CX-801 remains on track for IND filing by the end of 2023 with clinical initiation in 2024. Also in 2024, we expect BMS to make continued clinical progress with the anti-CTLA-4 Probody, including proof of concept studies in MSS-CRC and non-small cell lung cancer, with data anticipated to be available in 2024. We also anticipate considerable progress across all of our collaborations as we continue drug discovery activities with Moderna, Regeneron, Astellas, Amgen, and BMS. I’ll close by thanking our exceptional team members who remain highly focused on making the biggest difference in the treatment of cancer. This is an exciting moment for CytomX. And we anticipate multiple inflection points over the next 12 to 18 months, as we continue our work in such important and relevant areas of oncology R&D. With that operator, let’s go ahead and open up the call for Q&A.
Operator: Thank you. [Operator Instructions] Our first question will come from the line of Roger Song with Jefferies. Your line is open.
Roger Song: Great. Thanks for the update and taking our questions. So maybe, let’s focus on the now for as the near-term pipeline. So maybe Sean, you can let us know. What is the expectation for upcoming data in first half next year, particularly, maybe any thoughts around the number of patient tumor types you will be able to share with us? And the second part is what will be the key consideration to move into the expansion cohort. My understanding is that decision will may – will be made later part of ‘24 with more follow-up maybe another data update. Yes, that’s the key question I have right now. Thank you.
Sean McCarthy: Right, yes. Hi, Roger. Thanks for the question. So to take a little step back on 904, let’s just recap our major objectives with the program. So as I mentioned, as we’re coming towards the end of 2023, we are now beginning to backfill certain cohorts in the dose escalation. The dose escalation is essentially being conducted in an EGFR, all comer setting, so we’re enrolling patients who are expected to have EGFR expression, we’re not actively selecting for EGFR expression, but their tumor types are expected to be EGFR positive. And this is Phase 1a right and as we saw ESMO, just a couple of weeks ago, Phase 1a early dose escalation and dose exploration for T-cell engagers needs to be done thoughtfully, needs to be done methodically, with the principal objective of evaluating safety. And those things schedules for these potent agents. And so that’s what we’re doing. And our goal. As I said, next year will be to analyze the Phase 1a data with our partner Amgen, and in collaboration with Amgen, make a decision on the go forward plan for Phase 1b. And of course, a go forward to Phase 1b would involve expansions into select EGFR positive tumor types, to really gain additional experience with the drug candidate. So, we’re on track with the goals, we are on track with our guidance of initial data from Phase 1a, in the first half of next year. And not ready at this stage to talk about number of patients or specific tumor types. That will be a little premature, but we are on track and making good progress.
Roger Song: Thank you. Maybe just a quick clarification, when we see the initial data in that data set, you will make the expansion cohort decision or you will wait for later to make that decision. Thank you, Sean.
Sean McCarthy: Yes, that’s a great question. It’s a little hard to say at this point, I guess, as we’re in the throes of this study, again, pointing back to the very important updates that we saw from several companies ESMO in this modality. The early Phase 1a exploration of doses and schedules, can take some time to get that to a place that you’re ready to move into Phase 1b, and of course, increasingly, we’re expecting, we’re seeing that Phase 1b involves more than one dose, more than one dose and schedule per project optimist. I think the Amgen data for tarlatamab I think illustrated that very, very clearly and very, very nicely. So I think the short answer is will see. We will continue to collect data to make the best decision we can as we look to transition from Phase 1a to Phase 1b next year.
Roger Song: Excellent. Thank you, Sean.
Operator: Thank you. [Operator Instructions] And our next question comes from the line of Jade Montgomery from H.C. Wainwright. Your line is open.
Jade Montgomery: Hi, this Jade Montgomery from H.C. Wainwright for Mitchell Kapoor. So, when it comes to CX-801, is there any particular tumor type there that this particular interest like with CX-2051, you mentioned? That was the primary interest in the one type of tumor, the one for CX-801?
Sean McCarthy: Yes, thanks for the question. So, what – maybe let’s start with what we know about interferon, so CX-801 being a conditionally active interferon. So we know that interferon has shown clinical activity in several tumor types in melanoma, in renal, in certain sarcomas, certain lymphomas. And the goal here with 801 actually as quite nicely demonstrated on our SITC post that the goal with 801 is to derive intra-tumoral immunity – anti-tumor immunity. So we’re looking to – and as we showed in the poster the preclinical data that we have shows that we are – 801 is very capable of inducing an immunogenic phenotype intra-tumorally. And so – and those tumor types where Interferon is active are generally speaking tumors that are immune competent. So, those will be obvious places for us to consider going in early clinical development. The other – another thing to say here is that the strategy – another thing about the strategy of 801. And as also emphasized in our SITC poster is that mechanistically, we would absolutely expect based on preclinical studies, Interferon Alpha, localized it for an Alpha-2b to partner very well with checkpoint inhibition. And in fact, we showed some potent combination data in our poster last weekend. And so in the clinical program, we would also be looking to, I would say fairly quickly move into the combination setting, which makes obvious sense to really derive and leverage the full immunobiology of Interferon in checkpoint inhibitor combinations. Let me just make one other comment on EpCAM, since you met – you made the reference to our EpCAM as well, in terms of tumor types. So, the strategy there is to bias our Phase 1 enrollment into CRC. But of course, EpCAM has expressed one of the things we love about this target is that EpCAM expressed in many, many solid tumors at high level. In fact, we believe that they are across the five major expressing cancer types for EpCAM. They are upwards of almost 300,000 potential treatable patients who are EpCAM positive across those tumor types. So, we will be focusing in CRC, but also enrolling additional tumor types as well, potentially looking for additional signals in the Phase 1 setting, so I hope that helps.
Jade Montgomery: Yes. That was great. Thanks. And I mean just more on both of those with the Phase 1 data, do you plan to trying to have that by the end of this year, or is that more of a 2025 timeline? What factors as well may influence do you think?
Sean McCarthy: Yes. So, the goal right now, where we are super focused as a company is to file the two INDs for 2051 and 801. Initiate clinical studies in 2024. I think as we have said for 2051, our goal is to get as far through Phase 1a in 2024 as we can. We are not ready at this point to give any guidance on data. That could take a little longer.
Jade Montgomery: Okay. Thanks for letting me know. Thanks.
Sean McCarthy: You’re welcome.
Operator: Thank you. One moment for our next question. Our next question comes from the line of Etzer Darout from BMO Capital Markets. Your line is open.
Lukas Shumway: Hi, this is Lukas Shumway on for Etzer. Thanks for taking my question. You have ongoing collaborations with Astellas and Regeneron. Can you give us an update as to how those are progressing? Maybe where we will see the biggest opportunities for the biospecifics from those and what types of programs you might see from those collaborations?
Sean McCarthy: Yes. Thanks for the question. And as we emphasized on the call, we are really thrilled to have such a large number of high quality partners to work with, it’s allowing us to expand the reach of the technology. And also it’s been an important means of financing for the company and I think will continue to be in the future. Both Astellas and Regeneron are focused in the field of biospecific immunotherapies. Our work with Astellas began a little earlier that that deal is a few years old now. Regeneron is a more recent deal about a year old. We did earn our first milestone in the Astellas relationship this year, which is very significant. That’s for one of the T-cell engagers that’s moving forward into IND enabling studies. The work with Regeneron is still relatively early. But it’s also focused in a number of bispecific strategies. We haven’t disclosed any specifics there, but the kinds of bispecifics, but of course they are very strong player in that field and we are absolutely delighted to be partnering with them, to be working with them and we expect really great things to come.
Lukas Shumway: Okay. Thank you.
Operator: Thank you. One moment for our next question. And our next question will come from line of Anupam Rama from JPMorgan. Your line is open.
Unidentified Analyst: Alright. Thank you for taking the question. This is actually Malcolm Kuno [ph] on for Anupam. Just one quick one, do you have a sense yet for which types of solid tumors you will be prioritizing for CX-904?
Sean McCarthy: Malcolm, could you repeat the first part of the question, we didn’t hear it clearly.
Unidentified Analyst: Oh, yes. Do you have a sense yet for which solid tumors we will be prioritizing for CX-904?
Sean McCarthy: Yes. Thanks for the question. Well, as I mentioned, in the early stages of the program, which we are in right now in Phase 1a, where we are escalating and exploring dosing schedule in the context of, broadly speaking, EGFR positive tumor types. So, as I put it, essentially a kind of EGFR positive all-comer strategy to gain initial experience with this drug candidate. As we move forward into Phase 1b next year, once we analyze the Phase 1a data, once we sit down with our partner Amgen, there are of course a multitude of EGFR positive tumors that we could move into, depending upon what we have seen in the early part of the clinical study. So, I think some of them are the obvious ones like lung, and head and neck name, but two, there could be others. And that will be a decision that will be taken. And we will take into consideration the commercial drivers of our partner, Amgen, so TBD.
Unidentified Analyst: Great. Thank you. Appreciate it.
Operator: Thank you. [Operator Instructions] Our next question will come from line of Peter Lawson from Barclays. Your line is open.
Courtney Bahlman: Good morning. This is Courtney on for Peter. Thank you for taking our question. I have a quick question on the CTLA program with BMS. What should we expect in the 2024 data update, and how many patients? Thank you.
Sean McCarthy: Well, thanks for the question. So, BMS most recently updated at their R&D Day, about a month ago. And the update was that they are with – this is with the non-fucosylated anti-CTLA-4 Probody that we call 288 that they are conducting proof-of-concept trials in non-small cell lung and MSF CRC, their studies are ongoing, the data are anticipated in 2024, but no additional details beyond that. So, we are keenly anticipating their data. And they of course are in the driver seat for data, disclosure and timing of any disclosures which at this point has not been clarified.
Courtney Bahlman: Thank you.
Sean McCarthy: You’re welcome.
Operator: Thank you. And I am not showing any further questions at this time. I would like to turn the conference back to Dr. Sean McCarthy for closing remarks.
Sean McCarthy: Great. Thanks very much and thanks everyone for your time today and for your interest in CytomX. This updates on our broad company progress has been helpful. Please feel free to reach out to our Investor Relations team should you have any questions and have a great rest of the day.
Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect. Everyone have a great day.
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