Cellectis SA (CLLS) 2024 Q3 法說會逐字稿

Good morning, everyone and welcome to the SEIC third quarter, 2024 earnings call. At this time, all participants are in a listen-only mode later, we will conduct a question and answer session and instructions will follow at that time.

Please be aware that today's conference call is being recorded. I would now like to introduce the first speaker, Arthur Stril, Chief Financial Officer. You may begin.

Good morning and welcome everyone to select this third quarter, 2024 business update and financial results conference call.

Joining me on the call today are Dr Andre Choulika, our Chief Executive Officer and Doctor Adrian Kilcoin, our Chief Medical Officer yesterday evening, selective issued a six K and press release reporting our financial statements for the nine months period and that September 30th 2024 and a business update. The report and press release are available on our website at selective dotcom.

As a reminder, we will make statements regarding Selective's financial outlook including the sufficiency of cash to fund operations in addition to its manufacturing regulatory and product development status, as well as product development status of its licensed partners. These forward statements which are based on our management's current expectations and assumptions and on information currently available to management including information provided or otherwise publicly reported by our licensed partners are subject to risks and uncertainties that may cause actual results. To differ from those forecasted.

A description of these risks can be found in our most recent form. 20-F filed with the Security Exchange Commission SEC and the financial report, including the management report for the year ended on December 31st 2023. And subsequent filing selected makes with the SEC. From time to time, I would now like to turn the call over to Andre.

Thank you Arthur.

Good morning and thank you everyone for joining us today. This quarter, we're excited to announce that research and development activities has started for three programs developed under our collaboration and research agreement with astrazeneca, one allogenic car T for hematological malignancies, one allogenic car T for solid tumors and one in vivo gene therapy for genetic disorders.

Like this is thrilled to have this strategic collaboration with one of the most impressive pharmaceutical companies of the past decade. Astrazeneca.

Together, we continue to advance our ambition in cell and gene therapy, bring potentially life saving therapies to patients with unmet medical needs.

In the coming months, we will continue to focus on the enrollment of patients in our core clinical trials.

We expect to present phase one data set and large state development strategy. In 2025 these programs are key for the company. And in order to focus our resources towards success, we decided to deprioritize the development of car T 123 evaluated in relapsed refractory acute leukemia.

We strongly believe that gene edited cells and gene therapies are revolutionizing medicine across a number of therapeutic areas and will become a large part of molecular medicine of the future.

With that, I'd like to turn the call over to Adrian Kilcoyne, our newly appointed Chief Medical Officer. We're thrilled to welcome Adrian to select us. He's a strategic forward thinking drug developer who is passionate about delivering life saving therapies to patients.

He joined us at the PVO time, bringing extensive experience in drug development as we're progressing in our core clinical programs. Adrian will give an overview of our clinical trials. Adrian, please go ahead.

Thank you, Andre.

As Andre mentioned, selectus continues to focus its development efforts on the B one and Nataal One studies.

While we will deprioritize the Amal one trial, assessing ear 123 in relapsed refractory acute myeloid leukemia. This study has provided important insights into the role of CD 123 targeted allogeneic car T therapy in the treatment of AM L and will inform the future development of our allogeneic car T platform recruitment in Bali 01 A study evaluating Newar 22 in relapsed refractory B cell, acute lymphoblastic leukemia has progressed. Well, we have now completed patient identification for all remaining open slots in the Bali one study to reach a total of 40 subjects treated as there is no longer require a requirement for subjects staggering. The remaining patients are being dosed concurrently. Therefore, we expect the phase one data set to be available in 2025. We are currently planning our regulatory interactions in support of our potential phase two strategy.

We also continue to enroll in the NLE one study of our dual car T acid ear 2022 in relapsed refractory, non hodgkin's lymphoma. This study is addressing an important unmet need for patients who have relapsed following multiple lines of therapy including when available. An autologous CD 19 car T. As Andre mentioned previously, we will endeavor to share the data for the phase one program in 2025. With that, I would like to hand the call over to Arthur Stri select us as interim Chief Financial Officer for an overview of our financials for the third quarter of 2024. Arthur. Please go ahead.

Thank you, Adrian and Andre.

We are excited about the progress of our partnerships which are positively impacting our financial position.

In particular, $47 million have been triggered so far under the astrazeneca Joint Research and Collaboration Agreement of which $25 million upfront and $22 million reached development milestones.

In addition to reimbursement of research costs incurred in our financials, the cash, cash equivalents, restricted cash and fixed term deposits classified as current financial assets as of September 30th 2024 amount to $264 million compared to $156 million. As of December 31st 2023 this $108 million increase is mainly due to $140 million cash received from astrazeneca as part of the second tranche of its equity investment in selectus $16 million cash received from the European Investment Bank. Eib pursuant to the disbursement of the EUR15 million tranche B under the finance contract with eib $8 million of cash in from our financial investments.

$27 million of cash in from our revenue partially offset by cash payments from selective to suppliers of $42 million including $30 million to R&D suppliers and $12 million to S DNA suppliers, selective wages, bonuses and social expenses paid of $32 million.

The payments at least debts of $8 million and the repayment of the PGE loan of $4 million.

You're invited to refer to our press release for figures related to consolidated net loss attributable to shareholders of selective for the nine months ended September 30th 2024.

The company believes that its cash cash equivalents and short term deposits as of September 30th 2024 will be sufficient to fund its operations into 2027.

We have been able to extend our cash runway through a combination of milestones received from the progress of our partnerships as well as prudent cash management for our wholly owned R&D pipeline and controlled SG&A expenses.

We are focusing our spend on developing our clinical product candidates. Ear 22 and ear 20 by 22 potential new product candidates and operating our end to end cell and gene therapy, manufacturing facilities in Paris and Raleigh research costs under the astrazeneca collaborations are funded by astrazeneca.

And now I would like to turn the call over to Andre for closing remarks.

Thank you, Arthur. To close out this call. I would like to reiterate that we are confident about the continued progress of our ongoing clinical trials in mythological malignancies as well as how excited we are about our surgical collaboration with astrazeneca at selective. We strongly believe that our product candidates, our technologies and our inhouse manufacturing capabilities will lead us and our partners with paradigm shifts for patients with hard to treat cancers and genetic disorders.

Positioning us at the forefront of this promising medical and scientific field.

Moving forward, we have an important information to share for the future.

The company has decided to hold calls only when there is a significant information to discuss or if there is a key update or business activities, we invite you to refer to our press releases for quarterly earnings and remain available to address any questions you may have.

In the meantime, selectus will participate or organized calls or in-person events. I swip outside quarterly calls to update you about our progress with that. I would like to open the call for Q&A.

And at this time, if you would like to ask a question, please press the star and one on your telephone keypad, you may withdraw your question at any time by pressing star too.

Once again to ask a question, please press the star and one on your telephone keypad.

We'll take our first question from Jenna Wang with Barclays. Please go ahead. Your line is open.

Thank you for taking my questions. Andre and also Adrian, welcome on board. So two questions from me. The first one is a car 22 bo one P face one data next year. Could you give a little bit more color regarding the page numbers and the follow up? And what kind of data sets you will be sharing and in what kind of format? And the second question is regarding the de prioritized the you call 123 in L in the past, you did show some encouraging or promising data. Can you give us the reason why you de prioritized? Is that because the the enrollment speed or the the patient population in indication wise or you know, you haven't seen the previous activity was able to hold focus.

For a different Yeah. Thanks for the, it's a great question. So with regard, I'll take the EUC R 22 question first. As as I said earlier, we are now on track to have 40 patients, the total patient number within the dose escalation phase of the study.

So that's the number of patients we would anticipate to be able to share in 2025. Obviously, that's part of the dose escalation. And we're currently, as I mentioned earlier at a phase where we no longer require staggering. So we would anticipate these last patients to be completed at a greater pace as you would expect it in the car T space. So again, 40 patients in 2025 in regards to UCART 123, you're absolutely correct. We've seen some really good signals within with this target within AM L. However, we have a responsibility to ensure that we have the best use of our cash and we prioritize the key assets. So we're prioritizing the assets that we believe gave us the highest chance of success and that's why we have focused on Natalie and on Bali. That's not to say we don't believe there's a place for this therapy within the AM L setting. We just have to prioritize what we can achieve with our runway. We have to optimize our runway.

Okay. Thank you.

Thank you. Our next question comes from Jack Allen with Bird Obituary. Please go ahead. Your line is open.

Great. Thanks so much for taking the questions and congratulations to the team on the progress and Adrian for the new role. A couple from us, I, I guess first on Car 22 Adrian, you mentioned that you're, you're now enrolling patients in parallel. How should we think about the durability as it relates to the, the the outcoming update in 2025? Is there a mark at which you you'd like to see as it relates to follow up before announcing that data? And then similarly for car 20 by 22 how should we think about the breadth and depth of that data set as we look at on 2025?

So great question, we know that with any allogeneic therapy, you know, we, we, we do question persistence a lot, your ability, a lot. And that's where our ongoing conversations with the regulatory authority. These are focused. What is the right indication? What is the right patient group? So absolutely, when we announce this data, we will be announcing in terms of durability response and a regulatory approach, which hopefully will make a lot of sense when you hear that later on in 2025 I missed the second question. Sorry. Could you repeat that?

Yeah, thanks so much for that call there. And then just on 20 by 22 how should we think about the, the breadth and depth of that data set as we look at on 2025?

Yeah, we aren't as advanced in 2022 as we are with 22 we still got fewer patients. We are. However, we're in a position where there's a lot of demand and I would say across 22 and 2022 there's a lot of demand for patients in this study. So we would anticipate relatively brisk recruitment. We know that this is far more common disease, but we do have waiting lists for slots in both of these studies. So I would anticipate we will have a pretty robust data set by 2025 to share with you.

Got it. Thank you so much. And then maybe just one more if I could on the financial side. Arthur, I was hoping you could talk a little bit about the evolution of revenues from the astrazeneca deal. Forgive me, I believe the number is about 34 million in revenues to date. Is that primarily from astrazeneca? And, and how should we think about the, the fourth quarter with the disclosure of a number in the 40s of accrued revenues realizes relate to milestones from astrazeneca?

Yeah. Thank you so.

Much, Jack, great question. So just by way of reminder, so the, the astrazeneca collaboration allows for up to 1017 therapy programs. We're very happy to have already initiated three.

And so I think what we wanted to report is really the number of milestones and upfront that have been triggered which have a direct impact on our cash position. Which by the way is one of the reason why we're now able to get a cash guidance to 2027 as opposed to 2026 previously. The reason why the revenue number differ is is through the accounting treatment of revenue, some of this revenue is capitalized and and and recognized over time as opposed to recognize as a oneoff item. And so you will always see some slight discrepancies between the revenue numbers and the actual milestones that are triggered. This is why in the press release, we want to focus more on the, on the on the milestones that have been hit. And if you want more details, I invite you to to refer to our six K which gives a bit more detail as to the accounting treatment of revenue.

Thanks so much for the call and congrats on the progress.

Thanks.

Thank you. Our next question comes from Eagle Locomotives, Spit city please go ahead.

Hi team. This is Ashik Mubarak Onal. Thanks for taking my questions. For, for B 01, you alluded to 40 subjects being in the dose escalation phase and that's the data set. We'll see. I'm just wondering where where you are in thinking about those expansion and, and those selection is that pending sort of phase two regulatory interaction and for that regulatory interaction, what what are some of the key questions you're hoping to get some clarity on. Thanks.

Yes, you're correct in your assumption, we are looking at the right approach to our phase two expansion study right through to our a complete regulatory path. So we're being very careful in terms of our choice of endpoints because we believe that allogeneic therapies are unique and therefore, they require a very thoughtful approach in collaboration with the regulatory authorities as to what the right endpoint is for these patients. We believe that we know the position we're going in now. But again, we, we look forward to sharing more information with you in 2025.

Well, thank you very much.

I think your next question comes from Yan Zu with Wells Fargo. Please go ahead.

Hi. This is Konan for Yanan. Thanks for taking our questions. So I have a question on Bali O Bali, sorry. Ba I'm sorry, Natalie 01. So do you sorry Bali 01? Do you continue to see your inhouse products performing better than the CMO products and any safety signal you have seen in the study? Thank you.

We've seen earlier data that has suggested that our inhouse product is actually superior to P ONE as we call it the previous product. So yes, that, that we're not no longer dosing with P one. So we're not able to say on a patient by patient basis. Is there a difference? What was the second part of that question? Sorry.

Oh and.

Abus anymore.

Yeah, thank you.

Oh yes. We, we haven't seen any of those limiting toxicities thus far. So we're, we're very encouraged across all our programs with the safety profile we've seen across 123, 22 and 2022.

The, the like P one and P two are not comparable really in terms of expansion. And we definitely see great results as P one but like P two in term of like translational me data that we get in terms of expansion is unmatched. And we definitely think that it's like really products that have a great power, but like P one is not those anymore.

Got it. Thank you so much for that color. And one last question from us. So for the phase two studies for both 2025 22 do you need active controls? And if so what could be the controls? Thank you.

We, we don't believe that we will need active controls, but again, we don't want to second guess what the final guidance from the regulatory authorities are. We would anticipate those single arm studies.

Got it. Thank you so much for all the conder.

Thank you. Our next question comes from Luisa Morgas with Kenten. Please go ahead. Your line is open.

Hi team. Thank you for taking my questions. I, I wanted to firstly ask in terms of the, the three programs that have been initiated under the Astrazeneca Partnership. Do you already have any idea when you plan to provide more updates here or is that totally under Astrazeneca guidance, let's say?

Yeah, thank you so much. So we, we definitely, so program is that the programs are very much on the way and there's a daily activities and discussions between the two teams who are working very closely together. I think it's interesting and you, you can see also from the press release that these are three programs in very distinct therapeutic areas and modalities. So we are doing hematological malignancies. We're doing solid tumors and then we're doing in vivo gene therapy. So we're really leveraging the breast and depth of the selected platform, but also astrazenecas, a therapeutic area expertise. We plan to provide an update likely next year on the progress of the programs. We want to be at a stage where the program has progressed enough that the, the update is meaningful. So stay, stay tuned for this.

Okay, perfect. And in terms of costs for the remainder of the year, what can we expect in terms of R&D? And also G&A.

Yeah, great.

Question. I think we'll be trending. We'll be trending in, in the same vein as the beginning of the year. So I think we're not expecting any bonus at the end of the year. And we're in the process of and we will be providing more update at the next update on the future years. But the most important point is really that we were able to extend the cash runway into 2027. Both through a combination of prudent cash management as well as increased revenue from our collaboration partners.

Okay, perfect. Thank you for the additional color and that's all from my side.

Thank You.

Thank you. Next question comes from Salveen Richter with Goldman Sachs. Please go ahead. Your line is open.

This is Tommy on for Salveen. Thanks for taking our question, clear outs on the progress. I think that the previously disclosed expectation for B one was to have data by year end. Can you speak to what contributed to the shift to 2025? And as a follow up, can you speak to the factors that you're thinking of towards establishing the phase two dose? Thank you.

The primary driver and thank you for the question. The primary driver was actually to increase patient numbers within the, the later cohorts. So we have expanded up to the maximum number of allowed patients. We wanted to make sure we had enough data to inform a very thoughtful phase two development. And so we thought it prudent to actually get the extra data in order to support both us and the regulatory authorities in making the final decision. So so hopefully that answers the question, but we believe it was the most strategic back forward.

Thank you.

Thank you. Our next question comes from Sylvan Turkin with citizens. JMP. Please go ahead.

Yeah. Thank you. Thanks for taking my question and congrats on the progress.

Maybe.

Welcome Adrian to select this. Could you please tell us a little bit at a high level if you're making and what they could be any changes to the medical research organization to select this as you take over from you know, Doctor Fortini. And then could you also remind us if there are any royalties from? I thank you so much.

Thank you for the question. I'll take the first bit.

So yes, of course. We believe that as we're embarking now towards stage two, we do need to build the capabilities in the organization. We have just recruited another hematologist oncologist into the team with extensive experience across multiple cell therapy companies including auto.

So we believe that that's really helped our capabilities moving forward. We will continue to expand our clinical operations team as well. And again, we anticipate in 2025 we will have to expand further to support our phase two activities. So we believe we are building the capabilities within the team now to support us moving forward.

And I can take highs and this is Arthur, I can take the question on IO events. So just reminder IOS is leveraging our tailor gene editing platform to inactivate tumor infiltrating lymphocytes. And I think the recent bl a approval for nonedited tail therapy is kind of testimony that we picked the right partner in the tail space, which is now the only company that has a approved tail therapy on on the market which, which we is very exciting, exciting. So we have one program with them already in the clinic. It's APD one inactivated tail therapy, ISO 4001 which is currently in phase one evaluated in Melanoma and non small cells and cancer. And we do have economics attached to that but they have not been disclosed.

Thank you.

Thank you. And this does conclude our Q&A session as well as our conference call. Thank you all for your participation and you may disconnect at any time.