Cellectis SA (CLLS) 2024 Q4 法說會逐字稿

Good day, everyone, and welcome to today's Cellectis this full-year 2024 earnings conference call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-answer session. (Operator Instructions) Please note today's conference is being recorded. I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Arthur Stril. Please go ahead.

Good morning, and welcome everyone to Cellectis fourth quarter and full-year 2024 business update and financial results conference call. Joining me on the call today are Doctor Andre Choulika, our Chief Executive Officer; and Doctor Adrian Kilcoyne, our Chief Medical Officer.

Yesterday evening, Cellectis issued a [6K-M] press release reporting our financial statements for the 12-month period ended December 30 2024 and a business update. The reports and press release are available on our website at cellectis.com.

As a reminder, we will make statements regarding Cellectis financial outlook including the sufficiency of cash-to-fund operations in addition to our manufacturing regulatory and product development status, as well as product development status of our 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 filed with the Security Exchange Commission SEC, and the financial reports including the management report for the year ended on December 30 2024, and subsequent filings Cellectis 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. 2024 has been an important year for Cellectis. On the business development front, we were excited to announce the start of a research and development activities for three programs developed under our collaboration and research agreement with AstraZeneca.

So far, we announced the start of one program of an allogenic CAR T for hematological malignancies malignancies. One program of an allogenic CAR T for solid tumors. And the first of an in vivo gene therapy of a genetic dis for genetic disorder.

We're thrilled to grow the strategic collaboration with AstraZeneca, a top leader of the pharmaceutical industry aimed at shaping the future of our next generation of cell and gene therapies. We're very excited about the huge opportunities this partnership will bring in the months ahead.

Additionally, this year, AstraZeneca completed the additional equity investment of $140 million in Cellectis. As part of the additional investment, AstraZeneca subscribed for $10 million Class A convertible preferred shares and $18 million Class B convertible preferred shares. In each case at a price of $5 per convertible preferred share.

Giving effect to the conversion of Class A and Class B preferred shares and immediately after the closing of the subsequent investment, AstraZeneca would own approximately 44% of the share capital of Cellectis and approximately 30% of the voting rights.

We also drew down the two last tranches of the finance agreement signed in December 2022 with the European Investment Bank for up to EUR40 million credit facility. We're now confident that our cash runway allows us to fund operations into mid-2027.

On the clinical side, we're thrilled to have Doctor Adrian Kilcoy join us as Cellectis' Chief Medical Officer. Adrian is a huge leader and a strategic forward-thinking drug developer who's passionate about delivering lifesaving therapies to patients. He joined us at the pivotal time as we're progressing in our core clinical programs.

2024 was an exciting year with a grant by the FDA to our product candidate UCART22 of an orphan drug designation and rare pediatric disease, as well as an orphan drug designation granted by the European Commission for the treatment of relapse or refractory acute lymphoblastic leukemia.

These designations represent a step towards developing widely available allergenic products for patients in need.

Cellectis expects to present the phase one data set and latest development strategy for UCART22 in the third quarter of this year. In the NATHALI-01 study evaluating UCART20x22 in relapse or refractory non-Hodgkin lymphoma, Cellectis continues to focus on the enrollment of patients and expect to present Phase 1 data set and late state development strategy in late 2025.

In 2024, Cellectis' innovation team showcased promising CAR T strategies utilizing TALEN gene editing technology to target solid tumors and overcome their immunosuppressive tumor microenvironment.

[Precontal] data were presented at both AACR Immune oncology and SITC annual meetings. And two scientific articles were published in Molecular Therapy and Science Advances.

We're proud to collaborate with leading scientists in the gene editing field who continuously pushes the boundary of innovation and are committed to cancer patients with unmet medical needs.

This year, Cellectis this will continue to focus its efforts and expenses on advancing its core clinical trial. BALLI-01 and NATHALI-01 while building the next generation of genomic medicines to address area of high unmet medical needs within our partnership with AstraZeneca and within our proprietary pre-clinical pipeline. With that I would like to turn the call over to Doctor Adrian Kilcoyne, our Chief Medical Officer who will give you an overview of our clinical trials. Adrian, please go ahead.

Thank you Andre. As Andre mentioned Cellectis continues to focus its development efforts on the BALLI-01 and NATHALI-01 studies.

Recruitment in BALLI-01 a study evaluating UCART22 in relapsed refractory B-cell acute lymphoblastic leukemia has progressed well. The study is addressing an important unmet need for patients who have relapsed following previous lines of therapy including a CD19 by specific autologous CAR T.

We plan to share the full phase one dose escalation data set in the third quarter of 2025 with additional data presentation planned at the ASH annual conference in the fourth quarter.

Regulatory interactions are planned with both FDA and DMA to align on our Phase 2 registration strategy. We are currently planning additional study sites in both the United States and Europe including the United Kingdom in anticipation of an agreed registration path for a pivotal Phase 2 study. We expect the Phase 2 study to be open for recruitment in the fourth quarter of 2025.

We also continue to enroll in the NATHALI-01 study of our dual CAR T asset UCART22 in relapsed refractory non-Hodgkin's lymphoma. This study is addressing an important unmet need for patients who have relapsed following previous lines of therapy including, when available,an autologous CD19 CAR T.

As Andre mentioned previously, we will endeavor to share data for the Phase 1 program in late 2025 at the ASH annual conference. Pending data assessment we plan to transition to phase two preparation in 2026. With that, I would like to hand the call over to Arthur Stril, Cellectis' Chief Financial Officer and Chief Business Officer, for an overview of our financials for the fourth quarter and full year of 2024. Arthur please go ahead.

Thank you, Adrian.

We are excited about our partnership and financing activities, which have been positively impacting our financial position. First, we completed the additional equity investment of $140 million of AstraZeneca in Cellectis, giving effect to the conversion of all their preferred shares. AstraZeneca would own approximately 44% of our ordinary shares and may exercise voting power with respect to approximately 30% of the voting rights outstanding with respect to our shared capital.

We are proud of counting AstraZeneca as a strategic shareholder. Second, thanks to the progress of our collaboration with AstraZeneca up to year-end 2024, $47 million have been paid to Cellectis under the joint research and collaboration Agreement of which $25 million upfront and $22 million reached development milestones in addition to reimbursement of research costs incurred.

Third, last year, we drew down the second tranche of EUR15 million and the third and final tranche of EUR5 million under the credit facility agreement entered with the entered with the European Investment Bank, EIB in 2022.

Following such activities or cash equivalents restricted cash and fixed term deposits classified as current financial assets as of December 31, 2024, amount to $264 million compared to $156 million as of December 31, 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 Cellectis.

$20 million cash received from the EID pursuant to the disbursement of the second and third tranches under the finance contract with EID. $43 million of cash in from our revenue, partially upset by cash payments from Cellectis to suppliers of $47 million. Cellectis wages bonuses and social expenses paid of $40 million the payments of leased debts of $11 million and the repayment of the PGE loan of $5 million.

You are invited to refer to our press release for figures related to consolidated net loss attributable to shareholders of Cellectis for the 12 month ended December 31, 2024. We believe that our cash equivalents and fixed term deposits as of December 31, 2024 will be sufficient to fund our operations into mid-2027.

In 2024, we were able to extend our cash runway through financing activities the progress of our partnerships as well as prudent cash management for R&D pipeline and controlled SG&A expenses.

We're focusing our spend on developing UCART22 and UCART20x22 potential new product candidates. And operating our end to end cell and gene therapy manufacturing facilities in Paris and Raleigh while research costs under the AstraZeneca collaboration are funded by AstraZeneca. We're very much looking forward to providing phase one data sets for wholly owned clinical product candidates in acute lymphoblastic leukemia and non-Hodgkin lymphoma later this year.

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 hematological malignancies, as well as how excited we are about our strategic collaboration with AstraZeneca.

At Cellectis, we strongly believe that our product candidates our technologies and our in-house manufacturing capabilities will lead us and our partners to a paradigm shift for patients with hard to treat cancer and genetic disorders. Positioning us at the forefront of this promising medical and scientific field.

As previously said, Cellectis will hold calls only when there is a significant information to discuss or if there's a key update on a business activity. We invite you to refer to our press releases for quarterly earnings and remain available to address any questions you may have. With that I'd like to open the call for Q&A.

(Operator Instructions) Gina Wang, Barclays.

Thank you. Maybe this will be the last earnings call. With that I wanted to ask the upcoming data for the UCART22. But you said that you will have a data in 3Q. Maybe could you give us a little bit more color in terms of the amount of data including patient numbers the type of data point you'll be sharing with us in 3Q, and then in what kind of form you will share with us?

Hi, Gina. Thank you so much for the great question. I'll hand it over to Adrian.

Oh thank you Gina. Yes, so as we have said over the last few minutes, we would plan to have the full phase one dose escalation data set available in the third quarter.

So again, a full data set. How we're planning on sharing that Arthur can update you on. That's not to say we also won't have additional data being shared at ASH and as you're aware the cutoff for ASH is in all.

So we'll be submitting data for ASH. But we will have a full phase 1 dose escalation data set available in Q3.

Yeah, as for the specific event I think we're likely that we'll give you a bit more as the quarter moves on. But we're definitely targeting something that would be an ad hoc event.

Follow up at medical conferences including ASH this year. But the data release is likely going to be at an ad hoc event. So stay tuned. We'll give more details very shortly.

Jack Allen, Baird.

Great. Thanks so much for taking the questions, and congratulations on the progress. I guess maybe dovetailing on the question about UCART22 . I'd love to hear any thoughts the team has as it relates to how they're shaping up the internal bar for success as we move towards that third quarter read out then maybe I'll start there and then I do have a few follow ups if I could.

Yeah, it's a great question Jack. Thanks for it. We we're confident in the data we have seen thus far. We have to put this in the context of what patient groups we're looking at here. And we're looking at very heavily pre-treated patients. Many of whom have been exposed as we said in the airing call earlier exposed to CD19 therapy including autologous CAR T.

With that in mind though, we're very encouraged by the data we're seeing thus far. So the broad question while we can't share any data with you do we have concerns over the quality of the data that it would be able to surpass a regulatory requirement? We believe so. But we will have ongoing interactions with the FDA and EMA in the coming months. And then once you see the data we'll be able to you'll obviously see much more granularity to that.

Great, great. And then just two quick follow-ups more on the collaboration side of things. It sounds like the AstraZeneca programs are moving forward quite quickly. Any additional context around near term milestones you might expect there or when those programs can enter the clinic? And then how to think about these programs as it relates to the novelness of the targets of these really novel programs that they potentially me too kind of out of programs where auto has already shown proof of concept.

I know it's a multi-part question. But one other one that I just wanted to throw in there too was if there are any updates around the Sevier discussions that you're having with your partner there or I should say maybe formal former partner there as well.

Thanks, Jack. I'll take the question. So I mean we're obviously we share the excitement around the progress of the AstraZeneca partnership. I think what's interesting is that there's been a lot of very, very active discussion and work stream between the R&D teams of both companies over the last few months. And we've really cast a pretty wide net in terms of therapeutic areas and indication as you can see, we're not only in heme which was our initial playground. But we're in solid tumors as well as in in vivo gene therapy.

So there's really a breath and the targets. And the selection of the targets have been the follow up of numerous discussions with the with AstraZeneca. So we believe that each target under these programs has been very carefully selected and will be pretty exciting. We're keeping this under wraps for now. Progress is very good. But we want to be in a position where we present a comprehensive data set both from in vitro and depo proof of concept a line of sight to [IND]. And this is something that we could potentially disclose this year. So stay tuned. But we're very happy about the progress.

And on the survey arbitration story the as it is still an ongoing matter, I'm not going to be in a position to commit.

Great. Thank you so much for taking all the questions. Maybe I'll hop back in the queue. But congratulations again on the progress.

Salveen Richter, Goldman Sachs.

Hi, this is Lydia On for Salveen. Thanks so much for taking our question and congrats on the progress. Just another on UCART22. Could you just discuss the different potential late stage development strategies and how the data might inform this decision? Thanks so much.

So again, we are currently planning our interactions with both FDA and DMA and of course we cannot prejudge exactly how these conversations will go. So without us publicly sharing our data, I think it's very difficult for me to come further. However, we do believe as we see our data we believe that a registration path. We believe that's a clear registration path. We're just over the next few months will endeavor to get alignment with the regulatory authorities regarding that. So you will see again in Q3 when we share the data. I think again that added granularity will be helpful to you.

Sebastiaan van der Schoot, Kempen.

Hi Tim, good morning, thanks for taking my questions. I'm wondering regarding the latest can you maybe comment a little bit on where you expect that these registration trials to be similar to what we have seen from? And could you also remind us for the partnership details with the Allogene and the same myself. Thank you.

Sorry the line your line cut a little bit. Can you repeat the first part of the question?

The first part is regarding whether the a potential registration or trial in safety will be similar to what we have seen from autologous CAR T in adult all for your UCART22.

I think, as an allogenic therapy, we've always said we our trials reflect the unique nature of allogeneic cell therapy. So I think, but also we need to look at the previous autologous CAR T in this space where much earlier line therapy. So there is some subtle differences. But nonetheless, as these are what would be all cell therapies, we would expect a similar approach in terms from a regulatory perspective. But again, harnessing the unique the unique characteristics of allergenic cell therapy. So again, as I've said to previous questions, once you see the data in Q3. And I would encourage you to come along to our event I think that will become very clear.

And I can beg the question on Allogene. So I mean we're very pleased about the progress of Allogene and the assets that we've licensed so [semerce] which is licensed to Sevier and sub-licensed to Allogene. And then Allo 316 the CD17 renal cell carcinoma. I think Allogene has laid out a very interesting strategy in terms of leapfrogging autologous CD19 CAR T in the second line by going straight into first line consolidation.

They have a clear line of sight with the with selected length for depletion mid this year having an interim analysis in the first half of '26 and a potential BLA submission in ‘27 per their guidance. And I think this will be very interestingif the trial is successful that will be: A, very interesting read-through into our platform. And then B, obviously we're eligible to up to $410 million milestones and low-double digit royalties on these particular assets. And I think the three ones the progress of 316 also in renal cell carcinoma is very interesting. This is really the first allo CAR T that is making strides in solid tumors and in particular in renal cell. So we're also very excited to for Allogene to be sharing update on this hopefully.

Okay. Great. Thank you, guys.

Sylvan Turkin, Citizens.

Yeah good morning. And congrats on the updates and thanks for taking my question. Maybe just coming back on the allo collaboration you just outlined here. Do any of this near term maybe the mid-2025 read out trigger any milestone payments? Or is that expected rather to be towards the end when we get the interim ESS analysis then have a follow up?

Yeah thanks Sylvan. So we we're not disclosing the specifics of the individual milestone payments. I think the only guidance I can give at this stage I can give two guidances. The first guidance I can give is the overall $410 million milestones for MSL are pretty well spread out across the development registration and sales life cycle of the products. I think that that would be the first guidance.

And the second guidance which I think is important for everyone is when we say that our cash runway is mid-2027 we've pretty severely discounted any cash in we may receive from our partners including Sevier and Allogene. So this is we we've been very conservative in the way we've accounted for cash in with the mid-2027 runway.

Great that's very helpful. Thanks. And maybe if you could just break down your R&D spending remind us of the terms with your AstraZeneca collaboration. Does AstraZeneca reimburse you for all of the expenses you incur with those three programs or just a portion of it and how much is that of your total R&D expense.

Thank you.

Yeah. It's a great question. So basically the way the AstraZeneca collaboration is structured is the research activities we're doing with AstraZeneca are fully reimbursed by AstraZeneca. And so when I gave the breakdown of the cash coming from our revenue, this is a mixture of obviously milestones we've received. But also reimbursement of R&D cost and that has allowed us to partially offset our cash burn back in 2024.

So in total, we had a cash burn excluding cash in from partnership of a little bit over $100 million but the net cash burn has been $60 million. So I would say it was roughly $40 million-$60 million split. Obviously, this is what happened for 2024. It is not necessarily a guidance for the later years. But I've mentioned, again, we've been very conservative in cash in when we think about the mid 2027 runway. And we've included expenses for potentially registration or trials for both 22 and 20x22. I hope it helps.

Yeah great. Thank you. Looking forward to the update in the third quarter. Thanks.

Jack Allen, Baird.

Great. Thank you again for taking all the questions. Just a few more, if I may. I know you mentioned that you're not going to comment on the CVA litigation. But I guess to what I sent are you willing to kind of comment on the potential outcomes here? What do you what are you seeking from this arbitration and how could that play out if you are able to acquire a positive outcome from your perspective?

Yeah. Jack it's obviously, great question. But I mean given this is an ongoing legal activity, we're not going to be commenting right now. Sorry about that.

Yeah, no worries I have a backup question. So I wanted to ask about the recent discontinuation of cargos CD22 targeted asset in postcard TNHL. That's an autologous program. But I was wondering what if any read throughs you see as it relates to your UCART20x22 program, which is an allogenic?

Thanks Jack. I'll give you just some thoughts on the competitive landscape and then I'll leave Adrian to discuss a bit more about the actual medical implications for this. I think from the competitive landscape, what was interesting in the cargo story and obviously it's an unfortunate setback for the field. But what has been the thing is that cargo really proved that there's a clear unmet need and market for a non-CD19, CAR T in that space. I mean obviously CD19 has made a strides.

They're now firmly entrenched in the second line. Allogene is trying to get them to the first line in the allogenic version. But patients do relapse or can be refractory to CD19. And there's a clear and met need and desire from physicians to be hitting other targets like 20 or 22. So I think what cargo proved is that this is a clear market and a fantastic opportunity. Now again, from a pure competitive perspective the fact that the trial didn't go through is really opening up an avenue for a non-19 CAR T assets which we really want to be occupying with the with 20 by 22. And then I'll leave it to Adrian to give a bit more color on the medical front.

Yeah, it's a great question Jack. So when we look at this decision again it is unfortunate for cargo. We do believe that CD22 is an important target in this space. But if we look at the rationale why one is they had reasonably good CR rates. And this is based on their data. So this is my interpretation of it.

Good response rates early by three months I think it was an 18% CR rate. So they were struggling with durability. But equally importantly, when you look at the tolerability profile with the ICHS that was at about 18% greater than Grade 3. So clearly, they had that risk benefit wasn't adding up. And we look at everything in terms of risk benefit.

So it was great that we saw that they had efficacy from the target. Yes, the durability wasn't what they probably expected. But also, they had a toxicity profile. Now we do not believe that this toxicity is uniquely related to CD22 target. And that's certainly something that we haven't been seeing those kinds of rates of ICHS in our programs.

So overall, yes, it's disappointing for [CAR T]. But I do think it is making us double down really because the commercial opportunity is now greater for us. And I do believe with our strategy, we want to improve on that level of durability certainly. So I think yeah hopefully I've answered your question, Jack.

That's great context. Thank you so much for that. Now I'll just throw one more out there as you do mention the potential to improve on durability with an allogeneic RT product. I know that's been a key question in this for the field how allo compares to auto on durability. With that context in mind I was just hoping you could provide any comments you're willing to make on the recent data updates from the ALLO-501A (inaudible) program from Allogene. And it seems like they had some really strong durable responses out to four years plus.

Yeah absolutely, Jack. I think this is very encouraging and thanks for flagging it. I mean in addition to the progress and the roadmap they've laid out for Alpha 3 in the pivotal trial and the potential registrational indication, I think the data set that was published by Allogene back in February on the Alpha, Alpha 2 trial are very interesting for two reasons.

I think the first interesting thing. Takeaway is indeed the long term durability. And I think as you all know, there was this was the final question that Allogene CAR T had to address is can you get durability levels that are on par with autologous?

And I think the long-term data set is from Allogene which again is coming from our own platform is really giving a very interesting showcase that this is real. And that you can get to these very durable responses with an Allogene CAR T.

I think the other interesting analysis that came from Allogene is really the fact that this is they've looked at patients with a lower burden of disease, which are likely patients that will come into the Alpha 3 trial because this is a first-line consolidation story for MRD positive patients. And they've seen a very interesting outcome for these subsets of patients.

So I think all in all, it's definitely removing an overhang around your ability of the assets which I think is super interesting. But it's also paving the way for increased confidence into the outcome of the Alpha 3 trial. So thanks for flagging. And I think it was a really interesting and promising data set.

Awesome. Great. Well I always appreciate you guys, transparency and taking all the questions. Thanks so much.

Kelly Shi, Jefferies.

Hi, thanks for taking my question. This is [Hangfei Su] for Kelly. Just a quick follow up on your enrollment on the two program you called D22 and UCART22 . What is the enrollment progress there? And will we expect any recommended phase two do at your update, and how many patients we're looking? Thanks.

Yeah thanks for the question. Well as you have probably understood by this at this time that we are at for 22 because we're planning our inter-Phase 1 meeting clearly this is at the end of phase 1. We had planned up to 40 patients within that cohort and we have we have hit what we needed to in relation to that.

So hopefully that will give you an idea in terms of the number of patients you're likely to see at our Q3 update. In terms of the patient numbers for the clinical trials, I don't want to be to explain too much because those numbers are completely dependent on an agreed registration path with the regulatory authorities. However, we do believe we have a plan for what I would consider to be a realistic number of patients given that this is a smaller indication. We do believe that we can execute a Phase 2 program in reasonably quick time with the numbers we anticipate we will need.

Thank you.

Thank you and I'd like to now turn the call back over to Adrian Kilcoyne for any additional or closing remarks.

I think we're going to hand that over to Andre Choulika.

Well, thank you very much, Adrian for handing this back to me. And thank you very much for everyone for participating in this conference. We're extremely excited by the 2025 outcome and further for the company. And we definitely look forward for the next update of the company and give you some guidance for third quarter this year. With that I'd like to wish you all a great day.

Thank you, and ladies and gentlemen, that does conclude today's conference. We appreciate your participation. You may disconnect at any time.