Innate Pharma SA (IPHA) 2020 Q4 法說會逐字稿

Ladies and gentlemen, thank you for standing by, and welcome to the Innate Pharma Full Year 2020 Results Conference Call. (Operator Instructions) I must advise you that this conference is being recorded today, Thursday, 18th of March 2021.

I would now like to hand the conference over to first speaker today, Mr. Mondher Mahjoubi. Thank you. Please go ahead.

Thank you. Good morning, good afternoon and welcome to everyone. This morning, Innate Pharma issued a press release reporting financial results and business updates for the fourth quarter and full year 2020. The press release and today's presentation are available on the IR website -- on the IR section of our website.

Please move to start 2 -- Slide #2. Before we start, I would like to remind you that we will make forward-looking statements regarding the financial outlook in addition to regulatory and product development plans. These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasts.

Please move now to Slide #3. On today's call, I am delighted to be joined by Joyson Karakunnel, Executive VP and Chief Medical Officer, he will provide an update on our development portfolio; and Laure-Helene Mercier, EVP, Chief Financial Officer and Member of the Executive Board, who will provide an overview of the financials. Following prepared remarks, we will open the call up for questions.

But first, before we start, I would like to comment on the news we announced today that Laure-Helene has decided to step down from her role as CFO of the company. It's always hard to say goodbye to a valued member of the team. Not only is she a gifted professional and an outstanding leader, but she is also a wonderful person. And I would like to take this opportunity to thank Laure-Helene for all her many contribution to Innate Pharma during the past 14 years. We are also grateful that Laure-Helene has agreed to stay on in the company for the rest of the year in order to ensure a smooth transition of responsibility. Next month, we will welcome Frederic Lombard to Innate Pharma as a Chief Financial Officer. He brings to the company more than 20 years of financial experience in the pharma sector, and I look forward to introducing you to Frederic in the coming month.

With that said, I would now like to begin the call with an update on progress at Innate Pharma. Please move to Slide #4. As you know, at Innate, we are a pioneer in the field of innate immunity and natural killer cell. We follow the science to develop innovative medicines for patients, leveraging our antibody-generation platform. This scientific foundation is at our core, leading to a robust pipeline of novel therapeutics for cancers, but also for other life-threatening diseases with high unmet medical need.

Actually, Slide 5 depicts our research strategy. But let me first remind you that early approaches to immunotherapy were essentially T-cell-centric, and they have focused on enhancing T-cell responses either by targeting inhibitory pathways with immune checkpoint inhibitors or by targeting activating pathways as with CAR-T cells, for example, or bispecific antibody. These therapies have led to unprecedented successes and have transformed the natural history of many cancers. Yet, the unmet medical need is still high as only a fraction of patients respond to T-cell therapy and there remains significant relapses among those who do.

Broadly speaking, T-cells are not autonomous in their effector function. In fact, they need help from cells of the innate community, which we believe represents the next generation of immunotherapy. Indeed, given the crucial role of innate immune responses in immunity, harnessing these responses opens up new possibility for long-lasting, multilayered tumor control. To us, choosing the right target to direct the body's immune response is of paramount. And we do this by utilizing our fundamental understanding of NK cell biology, the tumor microenvironment but also tumor antigen.

Actually, on Slide 6, our pipeline shows how we have turned this scientific understanding and technology know-how into potential therapeutics with a robust portfolio of proprietary and partnered assets. Our lead product is lacutamab, and we will go into detail on this product later. But we also balance our pipeline with partnered assets, for example, monalizumab, while we maintain a healthy preclinical pipeline to fuel our future clinical portfolio.

Please move to Slide #7. Last year was an extraordinary year with the COVID pandemic and its global impact, but it was also a year where we refocused the business in order to concentrate our resources on our development portfolio and cutting-edge science with a refreshed corporate strategy aimed at maximizing both patient impact and long-term value for our shareholders. This refresh led us to take the difficult though correct decision at the end of last year to return the U.S. and EU commercialization rights to Lumoxiti to AstraZeneca. We felt it was important to make a timely, strategic decision that would help us to efficiently manage our resources and prioritize investment in those area of the business where we see the most significant growth opportunities for Innate long term. We work diligently to position Innate for the future, and we have an exciting time ahead of us.

This brings me to Innate's core priority in 2021 and beyond. Our efforts are divided across 3 key area. Firstly, with our lead proprietary candidate, lacutamab, we see near-term value driven by this program, which is in development, as you know, in T-cell lymphoma. Longer term, we are leveraging our antibody engineering capabilities to continue developing innovative molecules with a primary focus on our multispecific NK cell engager. This Innate proprietary NK cell multispecific platform will fuel our pipeline well into the future. Finally, we are creating a strong foundation for a sustainable business, leveraging partnerships with industry and academia to further validate our science, but at the same time, provide us with the capital that we can reinvest in early-stage discovery.

Actually, on Slide #8, you can see that over the past few months, we have made meaningful progress against our strategy. Joyson will speak to these updates in greater detail.

But before turning the call over to him, I would like to provide a quick summary on the recent highlights. First, lacutamab continues to lead our proprietary clinical portfolio as we pursue the broad development strategy across T-cell lymphoma. TELLOMAK, our Phase II study in subtypes of PTCL, is advancing, and we are pleased to progress the KIR3DL2-expressing mycosis fungoides cohort to stage 2 based on a positive earlier-than-expected signal. We also received EMEA (sic) [EMA] PRIME designation in Sézary syndrome, which further accelerates our pathway to reaching patients in this niche indication. And we also announced a next step in our clinical development plan for peripheral T-cell lymphoma, deploying a stepwise approach to reach this broader population.

Second, Sanofi recently made the decision to progress IPH6101 into IND-enabling study. This is the first candidate to emerge from our multispecific NK cell engager platform. And as we balance our portfolio with partnered assets, we strengthened our cash position in 2020 with a receipt of $50 million milestone payment from AstraZeneca as monalizumab advanced into Phase III. As a matter of fact, we have now received a total of $400 million from our monalizumab collaboration with AstraZeneca. Last year, we also received from AstraZeneca $5 million following the dosing of the first patient in the IPH5201 Phase I trial. As you can see, our novel science and validating collaboration continue to lead Innate forward.

I would now like to pass the call over to our Chief Medical Officer, Dr. Joyson Karakunnel, who will offer greater detail in our progress. Joyson, over to you.

Thank you, Mondher.

On Slide #9, I'll begin with lacutamab, our lead proprietary asset. As you might recall, lacutamab is a first-in-class humanized monoclonal antibody that targets immune receptor, KIR3DL2, a tumor antigen expressed on T-cell lymphomas in which antitumor activity is mediated by antibody-dependent cell site toxicity and phagocytosis.

Specifically, lacutamab targets KIR3DL2, an inhibitory receptor found in approximately 65% of patients across all T-cell lymphomas and even more in certain aggressive subtypes, but with limited expression in healthy tissue. To date, data from lacutamab have been -- have shown promise, demonstrating compelling single-agent activity and offering great potential in lymphomas historically associated with a poor prognosis and for which there are few therapeutic options at advanced stages.

Just recently, we held a virtual investor event featuring key opinion leaders for cutaneous and peripheral T-cell lymphomas. These KOLs spoke to KIR3DL2 expression and the unmet need in these populations, demonstrating strong therapeutic rationale for our approach with lacutamab.

If we can move to Slide 10. Our understanding of the target in the disease areas has informed our broad and stepwise development strategy for this program. First, Sézary syndrome represents a fast-to-market opportunity in a niche indication with high unmet medical group. From there, we can expand into other forms of T-cell lymphoma, notably, mycosis fungoides and, eventually, into peripheral T-cell lymphoma.

On Slide 11, TELLOMAK is our ongoing Phase II study in subtypes of CTCL and it is ongoing and continues to progress. For mycosis fungoides, we were very pleased to share the recent cohort data showed early efficacy signals in cohort 2, which is the KIR3DL2-expressing mycosis fungoides cohort. This has allowed us to advance this cohort from stage 1 to stage 2 and notably before 50% of the planned patients were recruited. Clearing this predetermined threshold earlier than expected is highly encouraging, and we look forward to sharing preliminary data from stage 1 of this cohort 2 at a scientific conference later this year. Our hope is these data will provide validation of our approach for CTCL beyond Sézary syndrome when we've already demonstrated strong Phase I results.

For Sézary syndrome, we continue to enroll patients in this cohort and expect to report top line data in 2022. Again, Sézary syndrome offers a potential fast-to-market opportunity as an addition to Fast Track designation in the U.S. And now PRIME in the EU, the TELLOMAK study could potentially serve as a pivotal trial in this indication.

On Slide 12, at our February lacutamab event, we were also very pleased to announce next steps in our clinical development plan for PTCL. We are initially exploring lacutamab in the relapse setting as it has the highest unmet medical need. In this setting, we are deploying a two-pronged approach by advancing 2 parallel clinical trials to evaluate lacutamab as a monotherapy and in combination with standard of care in KIR3DL2-expressing relapsed/refractory PTCL patients.

Let's take a look at the two-pronged approach. First, we will run a multicenter Phase Ib monotherapy trial, which will enroll approximately 20 patients to evaluate safety and characterize clinical outcomes for lacutamab in relapsed or refractory PTCL.

Two important points about this approach. Dependent upon the data, we will consider starting a separate trial in combination with other standard of care treatment. And we anticipate that the Phase Ib monotherapy trial will start in mid-2021. Secondly, we announced a collaboration with a leading global lymphoma research network, the Lymphoma Study Association, or LYSA, which will run an investigator-sponsored Phase II study. This study, known as KILT will evaluate lacutamab in combination with chemotherapy, GemOx versus GemOx alone, and will be a multicenter, randomized study with approximately 60 relapsed/refractory patients outside of the U.S. LYSA expects to start this Phase II combination trial with GemOx in the second half of 2021.

Overall, we believe this is an efficient strategy to identify the optimal regimen for lacutamab in the relapsed PTCL setting. Eventually, we expect to follow the data into earlier lines of treatment, including as a combination in the CHOP regimen in frontline PTCL or as a consolidation therapy following standard first-line treatment.

On Slide 13, turning now to our R&D efforts. Beyond lacutamab, our primary focus is on the advancement of novel NK cell engaging molecules from Innate's proprietary multispecific antibody platform, NKCE. NK cells are at the start of the immune response and present many advantages, including the ability to kill tumor cells while activating other parts of the immune system. Our NKCE multispecific antibodies target NKp46, the most NK cell-specific activating receptor, as well as CD16 on NK cells and a tumor antigen on the tumor cells.

Additionally, our NK cell engager antibodies have shown better antitumor efficacy than approved benchmark antibodies in preclinical tumor models. In particular, IPH6101, our NKp46-based NKCE in collaboration with Sanofi, has shown encouraging pharmacokinetic, pharmacodynamic and safety data in preliminary nonhuman primate study as well as positive manufacturability properties.

Moving to Slide 14. We are very pleased with the validation of our approach when Sanofi made the decision to progress IPH6101/SAR443579 into investigational new drug-enabling studies earlier this year.

Three important highlights about this program. First, this is a part of our ongoing research collaboration with Sanofi to evaluate up to 2 NKCE. Secondly, selection of IPH6101 triggered a EUR 7 million milestone payment to Innate and Sanofi; and Sanofi is now responsible for all future development, manufacturing and commercialization of IPH6101. And lastly, in January, a GLP-tox study was initiated for IPH6101 or SAR443579 program, and we remain eligible for further downstream development and commercial milestones as well.

We're very excited about Innate's proprietary multispecific NK cell engager platform. We believe this technology will deliver our next-generation clinical molecule with immense applications in oncology and look forward to sharing more detail soon on these efforts. Building on the activity of cytotoxic antibodies, such as lacutamab, we designed the platform to boost the activity of anti-tumor antibodies by harnessing the activity of NK cells, the NKCE platform.

On Slide 15. Finally, before I turn the call over to Laure-Helene to review our financials, I would like to highlight the last portion of our strategy, which aims to build a fully sustainable business with a strong financial foundation to bring much needed products for unmet medical needs to market. Monalizumab, our late-stage asset partnered with AstraZeneca, stands as a testament to our capabilities in collaborating with leaders in the field to develop medicines for patients with significant unmet needs.

Three key points that I'd like to highlight about monalizumab. First, AstraZeneca dosed the first patient in its Phase III clinical trial, INTERLINK-1, evaluating monalizumab in combination with cetuximab in IO-pretreated patients with recurrent or metastatic squamous cell carcinoma of the head and neck. Secondly, the advancement of monalizumab represents Innate's first asset moving into Phase III and triggered a $50 million milestone payment from AstraZeneca to Innate, bolstering our cash position through the end of 2022. And lastly, AstraZeneca is responsible for the development of this program as well as 70% of the cost of the Phase III, and we remain eligible to receive another $50 million milestone following a preplanned interim analysis in the study.

Overall, we believe this collaboration, along with our other partnered programs, provides key validation of our scientific competency and supports our strategy to create a sustainable business with multiple revenue streams for investment into R&D activities.

Now I'd like to turn the call over to our Chief Financial Officer, Laure-Helene Mercier, to review the financials.

Yes. Thank you, Joyson. Good morning, everybody, or good afternoon.

I will start with our most important metric, as usual, which is cash. So as you know, we are in a strong cash position and our cash and cash equivalents amounted to EUR 190 million at the end of the year. This figure includes the $50 million milestone payment that we received in 2020 for the first patient dosed in the Phase III with monalizumab. And it does not include the EUR 7 million milestone from Sanofi, which was received in February 2021.

Turning to the P&L, I will start with the revenue. Total revenue and other income amounted to EUR 70.5 million and is mainly made up of revenue from collaboration and licensing agreements for just over EUR 56 million. As a reminder, the revenue from collaboration and licensing agreement from AstraZeneca mainly stems out of the spreading over the development period of the upfront, opt-in and milestone payment and, therefore, does not impact cash. Due to the timing and progress of the clinical trials, the revenue from this agreement can vary quarter per quarter. Note also that in 2020, it was last year, we included revenue for IPH5201.

In 2020, we also fully recognized the EUR 7 million milestone payment from Sanofi as the event that triggered the milestone occurring in '20. So while we did not receive the payment until February, hence, it's not included in the cash, it is fully recognized in 2020 in the revenue line. Last comment about the revenue line. It also includes just over EUR 13 million in government funding and which is mainly research tax credit.

Moving to operating expenses. So we saw a decrease of around 14 million -- 14% compared to 2029, and they amounted close to EUR 90 million this year. This decrease is mainly driven by a 30% fall in R&D expenses to EUR 55 million in '20. R&D expenses are primarily related to our programs in clinical development, staff cost and depreciation and amortization for monalizumab and IPH5201 intangible assets. The main reason for the decrease is the completion of work for certain programs, such as the European filing for Lumoxiti and the preclinical work that allowed the transition to Phase I for IPH52, which is now under the responsibility and financing of AstraZeneca.

Selling, general and administrative expenses were EUR 31 million in 2020, an increase of EUR 5.5 million, which mainly relates to activities for our U.S. affiliate over a full year. Operating loss before impairment improved by 30%.

Now let's move to Lumoxiti. Net income from our distribution agreements cover the Lumoxiti net global inflows and outflows received from or paid to AstraZeneca for the commercialization of Lumoxiti before we fully transitioned the U.S. operation at the end of September. For the first 9 months, the Lumoxiti distribution agreement generated a net income of EUR 0.9 million compared to net loss of EUR 8.2 million in 2019. In addition, during the fourth quarter, the company recognized net sales from Lumoxiti of EUR 0.7 million. With the decision to return the commercial right for Lumoxiti to Astrazeneca, we will not be providing comparative insight to prior year's performance nor guidance for 2021 sales. As we are still negotiating the transition back to Astra, we may face additional expenses in 2021 in relation to the termination of this agreement.

For 2020, we have recognized an impairment of EUR 43.5 million, which resulted in us ending 2021 with a net loss of EUR 64 million compared to EUR 20.8 million the prior year. However, I want to remind you that this impairment does not have a cash impact and without this impairment, the net loss would have been flat year-on-year.

To recap, we have a strong cash and cash equivalent position with EUR 190 million at the end of the year. And we also expect the strategic decision to return the Lumoxiti right and refocus our investment on R&D to positively impact our cash horizon going forward, and we will be able to say more about this once the transition plan is finalized.

Thank you. And I will now turn the call back to you, Mondher.

Thank you, Laure-Helene.

Let's move to the conclusion slide, #18. As you can tell, we have an exciting journey ahead at Innate. We continue to build our business to create value for patients and stakeholders. And in summary, actually, we have positioned Innate for the future with this refresh strategy and made meaningful progress last year.

Just repeating -- as a summary, we moved forward with our broad development strategy across T-cell lymphoma in CTCL, Sézary syndrome and announced the PTCL clinical trial program for lacutamab, which we expect to start this year. We have key data readouts coming from TELLOMAK. Later this year, we will share the initial data from the KIR3DL2-expressing MF cohort. And in 2022, we will share the stage 2 MF data as well the potentially pivotal data in Sézary syndrome.

Second, our R&D engine was further validated as Sanofi choose to progress 6101 into IND-enabling studies. We will continue to leverage this antibody capability to develop innovative molecules with a primary focus on our next-gen NK cell engager molecules.

And finally, as you heard it from Joyson, we continue to build the sustainable business by balancing our portfolio with partnered assets that provide substantial revenue stream to support our continued growth. And under the agreement with AstraZeneca, we received a $50 million milestone payment as mona advanced into Phase III and a $5 million payment following the dosing of the first patient in the anti-CD39 Phase I trial. Collectively, we are driving value across our business and ultimately advancing our goal to deliver innovative medicines to patients. We look forward to keeping you updated on our progress.

That concludes our prepared remarks. We will now open the call to questions. Maria, up to you for the questions, please.

(Operator Instructions) So our first question comes from the line of Yigal Nochomovitz from Citigroup.

I just had one question on the Phase III trial in head and neck cancer with AstraZeneca for monalizumab. Could you just explain what specifically triggers the interim analysis? And if you could talk about what is the predefined threshold of clinical activity that you need to see in order to move forward with that study?

Yes. Absolutely. Thank you, Yigal. Before handing over to Joyson to provide you more details, just a reminder, INTERLINK-1 is this first Phase III trial aiming to demonstrate the role and the benefit of the combination of monalizumab and cetuximab versus cetuximab alone in head and neck cancer patient with refractory and metastatic disease that have already pretreated usually with cisplat-based chemotherapy as well as PD-1 or PD-L1 inhibitor. This Phase III was developed on the basis on -- of the Phase I and Phase II data that we have generated through our Phase II program where we tested as a single our Phase II trial mona antitoxin heavily pretreated head and neck cancer patient. And those data, as I said, led to the Phase III.

Now I hand over to Joyson, so he can give you a little bit more colors on the prespecified activity window. AstraZeneca did not disclose publicly what is expected, but they gave some hint into the time line of the instrumentality. Joyson, can you provide more details on this question, please?

Sure. So I think when looking at the Phase III, we are looking -- I mean since AstraZeneca is running the study, those -- the timing of that analysis will be anywhere from within the next 18 to 24 months from the first patient enrolled. We don't -- I think the rest of the information around the benchmarks, et cetera, I think, are just -- it's a randomized controlled trial with cetuximab as the comparator arm. So that would be the benchmarks we're looking at.

Okay. And one other question. Just with respect to the preclinical portfolio, how close are some of these other assets that you've got to IND filing? You have quite a few beyond 6101. There's several that you listed on Slide 6. How close are those to IND?

Again, as you may remember, Yigal, we said that we will be providing an update at an upcoming scientific meeting on this platform. So we will share data coming out of our own preclinical work. Of course, the IPH6101 program that is in collaboration with Sanofi decision to communicate, of course, will be taken into consideration with Sanofi. But clearly, the focus from their side is on the completion of this IND-enabling study in order to file it as soon as possible and enter into the clinic.

On our side, we are working very actively to expedite actually the preclinical work of this platform in order to move it into the clinic as soon as possible. We did not disclose the time line, but it's our top priority. We will share preclinical data in the upcoming months this year, but also we will provide more details on the technology platform itself and the evolution that we are making in this platform.

And your next question comes from the line of Daina Graybosch from SVB.

First, I want to start with monalizumab, if you have any update on when we might see some data from AstraZeneca's ongoing COAST and neoCOAST studies with the combination with [savo] in early-stage lung cancer. And I'll ask the second question after the answer.

Daina, sorry to disappoint you, but we don't have more information than what is disclosed publicly by AstraZeneca. They are planning to share data from this program towards the second half of this year. So we will be delighted to share the data once they are ready to be shared with the scientific community in the second half of this year.

Great. And then my second question is sort of a follow-up on the one Yigal just asked on the NK engagers. I think a lot of us were hoping to see them come faster into the clinic and it sounds like you're working hard to expedite even more. Can you talk us -- can you talk at all about the process with 6101? Were there any challenges at getting it now to sort of the GLP-tox studies? Or any learnings that will make -- that will accelerate the development of further targets?

Yes. So I'm going to hand over to Joyson, but it's always, how to say, difficult to disclose scientific data ahead of scientific meetings and especially when it's in collaboration with a partner. But definitely, I can say that things are moving into the right direction on track.

But Joyson, maybe you can give more color on the overall program, in particular, the one we have in-house, but again, the 6101 as well.

Yes. So as we had mentioned, the Sanofi collaboration uses our proprietary technology. And so with -- since it sits with them, it is difficult to disclose. But I think what we can say is similar to any time you do kind of better the technology, you do learn from previous technology. So have we learned from the different aspects of it? Yes. We're taking those learnings and now also applying them to our recent NK cell engager platform that we had talked about that we're doing -- keeping in-house.

But Daina, I mean, as you would expect, this is really a top priority for the company. We are actively working on those programs, and we will update you in due course. And as I said, this year, we will be sharing the first set of data at an upcoming scientific meeting.

And then maybe one more. Could you talk about lacutamab in the cooperative trial in PTCL, why you chose that particular cooperative group? And what gives you confidence that they can sort of expedite the trial on time lines that a sponsored study would run on?

Sure. Joyson, would you like to take the question?

Sure. So the reason why we chose that group is they have been developing drugs for years and, in fact, were a critical group that helped in the development of Rituxan. So from our perspective, they had the lymphoma knowledge and expertise to be able to recruit. We also believe that they will at least be able to enroll at a very rapid pace. And since they see a lot of these, the T-cell lymphomas, we believe they also have the ability to -- they have the ability to have a wide variety of patients that are referred to them. So we think that using the -- going through LYSA would be -- is the best approach versus the sponsored study.

Yes. So LYSA was named before GELA Group, G-E-L-A. This is the group that developed rituximab and also GA101. This is a group who did the PRIMA trial and many other cornerstone actually turning the field on non-Hodgkin's lymphoma. They have a great deal of experience. Even though they are ex-U.S., they essentially are European here in France and other some countries, but they have really an impressive track record in terms of development drugs in non-Hodgkin's lymphoma.

And your question comes from the line of Liisa Bayko from Evercore.

I wonder if we could walk through the rationale for how you're thinking about PTCL, especially the combination with CHOP in the front line. Have you done any kind of preclinical work to look at that combination, in particular, with lacutamab? I'd be curious on how you see kind of potential synergies and what you could add to the frontline setting there.

Thank you, Liisa. Very important question. And as you would guess, this is on our, how to say, top priority list, trying to build up the preclinical rationale and prepare for the life cycle management of the drug once we show the proof-of-concept in advanced stage of the disease.

But I'm going to hand over to, again, our Chief Medical Officer, to provide you a little bit more details on the preclinical and scientific rationale for the front line and what we're in these days doing.

Yes. So as Mondher just mentioned, we want to start in the relapsed/refractory setting, and I'll kind of spin back to the preclinical, starting the relapsed/refractory setting, get a signal there and then kind of move into the earlier line setting. Now coming back to your question about the preclinical rationale, so we have preclinical data suggesting that agents such as gemcitabine, which is being used in our LYSA study as well as the inter-cycling may actually contribute to increasing the KIR3DL2 expression on T-cell lymphomas. So we believe that there would be a additive or synergistic effect, actually, with these type of combinations. So we believe in the relapsed/refractory setting using GemOx and then moving into the first-line setting, both has the chemotherapies that can help to increase KIR3DL2 expression.

And your next question comes from the line of Graig Suvannavejh from Goldman Sachs.

I've got four, if you don't mind, two maybe pipeline related and two financially related. One, how should we be thinking about some of your other pipeline assets, namely 5401 and 5301 as well as any -- your other non-NK cell engager, maybe preclinical candidates given your stated interest in prioritizing the NK cell engagers? Just want your view on how we should be thinking about those other assets.

And then secondly, just thinking about the CTCL landscape as you see it right now. In light of your positivity and enthusiasm for lacutamab, could you just give us a sense of what you are seeing in terms of the competitive landscape, particularly those that might be either late stage or early stage that you're keeping your eye on as potential competitors?

And then maybe just for Laure-Helene, and thanks again for your time with us and we wish you well on your next endeavors. But two questions, financially related. One, how should we be thinking about OpEx trends in 2021, particularly first half versus the second half? And then with respect to the transition plans with AstraZeneca, are there any other potential financial implications that we should be thinking about as it relates to that transition plan?

Thanks, Graig. Very [interesting] question. I'll start with the rest of the pipeline and then hand over to Joyson for the CTCL landscape and treatment paradigm as of today.

So first of all, on the rest of the portfolio -- clinical portfolio, and in particular, 5301 and 5401. As you know, 5301 is ready to start in Phase I. We were basically trying to gather as much information as possible from the competitors. There are so many other Phase I and Phase II trial ongoing. So before engaging, we wanted to try to learn as much as we can. And we are working on a Phase I trial that will incorporate all this learning. So we cannot -- we do not want to just repeat what the others have done. So trying to be very selective in our investment going into a combination of strategy and to tumor type that we have the highest chance to detect eventually, if any, a signal. So ready to go.

For IPH5401, as you know, there are 2 sections here. The oncology section following the STELLAR trial, as you know, we decided to stop the enrollment in the STELLAR trial because of the level of activity observed in that trial, but we said that we will continue exploring based on the results of the transactional data that we are generating. And those data actually are being generated. You have to just keep in mind that the STELLAR trial is 1 specific combination with durvalumab and 2 specific indication, non-small cell lung cancer, IO-pretreated and hepatocarcinoma. I think we will need to look at the totality of the data, including what's been potentially generated by others because, as you know, the other company who are following us and they're trying to explore 5401 in oncology.

And the second section is inflammation. We have here again a mechanism of action that is validated, to some extent, by other molecules that target either C5aR as a small molecule or eventually C5a. We try to generate a proof-of-concept in inflammation through IST, investigator-sponsored trial. And the idea is to, of course, partner whose -- partner of this asset once we generate those data because we don't have the bandwidth or the experience or the expertise to develop this ourselves in inflammation. So very, very pragmatic, generate proof-of-concept at low cost through an IST and then partner.

For the nonclinical or preclinical, you are right, we do not exclusively develop NK cell engager molecule. We have a number of classic antibodies essentially targeting checkpoint inhibitors expressed essentially on innate lymphoma cells. Those candidates are in preclinical development. Of course, when we say that our priority is NK cell engager, we mean it because we want really to expedite the preclinical development and, in particular, this PMC work. But at the same time, we want to increase the priority of success. So we focus our resources on our multispecific NK cell engager platform, and we are very data-driven when it comes to the rest of the portfolio, dependent, of course, on whether this is a partnered or a proprietary portfolio and dependent also on the preclinical data we generate. What I can tell you is that those preclinical data are being produced as we speak, some of them will be shared at an upcoming scientific meeting.

So this is for the rest of the portfolio. Now for the cutaneous T-cell lymphoma, I think it's a great question. It gives me the opportunity to ask Joyson, who has been working with his team on this topic and, in particular, on the positioning of lacutamab versus already approved but also potentially a common drugs that you may have in mind, of course, that target a different antigen. I'll let Joyson answer the question.

Yes. I think -- so when we look at lacutamab and at least the competitive landscape, we -- I think we are in a position that differentiates us from several of them. One, our safety profile as well as being able to directly target KIR3DL2. From some of the data we've seen, especially in the later-line settings based on our clinical benefit that we've been able to show for CTCL and PTCL, we think we're in a better position. In addition to that, being able to have sort of the FDA as well as the EU give us the Fast Track designation as well as PRIME kind of validate or confirms at least our position in comparison to others.

I hand it back to Mondher.

Yes. Actually, the next two questions are for Laure-Helene. So I'll let Laure-Helene answer. The first question is about the trend or guidance and trend for 2021, at least probably first half. And the second question is the transition plan on Lumoxiti and potential financial implication. Laure-Helene?

Yes. Thank you, Mondher. And thank you, Graig, for your kind words. So I'll start with the question on the transition plan. So you've seen in the press release that we are referring to our negotiation with AstraZeneca, more specifically, referring to some manufacturing costs. So this is a done discussion, but the biggest area of -- that's the most significant cost that we are expecting. Now remember that at the moment, we are still carrying some operations in the U.S. since we are the holder of the BLA, and we are booking sales. So we are still carrying the operational cost and assuming the transition period going to its maximum duration provided in the license, that would be in the low to mid single digit million euro for the year.

That brings me to the second question, which is where the OpEx are going. So I'd rather guide in cash because as you know and as you witnessed over the year, we have a lot of noncash items in the P&L and a lot of items as well that are not going through the P&L, for example, the cash -- the co-funding of the Phase III trial, so I'd rather guide into cash. And the underlying cash consumption is expected to be in line or in slight decrease compared to this year in the region of [EUR 80 million] most probably still a slight decrease. Again, it will depend on the discussion that we are having now. Of course, the way that we are seeing it is SG&A decreasing over the year and inventory R&D picking up with notably the lacutamab trials going through still and SG&A, obviously, because we will transition back the work to AstraZeneca.

Okay. Graig, is that okay? Does it answer your question?

Okay. It's all good.

And your next question comes from the line of Damien Choplain from Kepler.

Just a quick one on monalizumab. Do you think it's realistic to expect the publication of clinical data from Phase I/II in colorectal cancer and -- in NSCLC this year or maybe in 2022?

Yes. Thank you for your question. So you know that the CRC data I guess that you are referring to are the combination of monalizumab and cetuximab plus or minus durvalumab in previously treated second and third-line CRC I guess because the frontline data were already published at ASCO VR, as you know.

Okay.

We -- okay. So I think the ball is in AstraZeneca camp, of course, they are a sponsor of the data and they will communicate in due time once they have the level of maturity because those are Phase II data, even though they are randomized Phase II data, but with a small sample size, so we need to be cautious. And once the data are mature, of course, I'm sure AstraZeneca will communicate on those results, but they did not provide any specific time line.

For the non-small cell lung cancer, I think the question asked by Daina earlier, these are different in the sense that, first of all, the trial target setting of the disease where durvalumab is not only active, but established standard of care at least in the stage 3B unresectable. These are trials that -- are platform trials comparing durvalumab as the standard of care through a number of other combinations, including combination with monalizumab. These are Phase II trial with a primary end point being response rate. But as you know, in this setting, response rate, it said does not mean a lot. We need to have the totality of the data and some kind of durability and follow up in order to assess the benefit. So probably data of AstraZeneca would again wait for maturity. They have, at least on their public communication, mentioned that the data will be disclosed or results will be published in the second half of this year.

And your last question comes from the line of Arthur He from HC.

This is Arthur for RK. I had two question. One is regarding the monalizumab. So we could expect the data from the cohort 3, which is IO-naive patient in this year. Could yo u give us more color which kind of avenue we can expect that data publishing?

Yes. Absolutely. Thank you for your question. Joyson, can you provide some more details on when and which type of congress at this point in time? For cohort 3, we're talking about monalizumab cohort 3. This is a triplet.

Yes. So yes, I mean for cohort 3, we are working at publishing that data later this year for the triplet. Keeping in mind, it is a single-arm study. So there are many caveats, but we'd like the group to see the totality of the data. And so we're probably publishing that later this year.

Okay. And regarding the COVID-19 trial for the -- I remember there's 2 parallel study ongoing, right? So -- and for the FORCE trial, could we expect any data to be published this year?

Yes. Thank you again for this question. As you know, FORCE is an investigator-sponsored trial, which is currently ongoing. And unfortunately, we cannot give specific time lines or any further detail about the progress of the study as Innate is not responsible for running the trial.

There are no further questions at this time. Please continue.

Okay. Thank you. Thank you very much. Thanks to everyone for joining the call and your questions. I hope we gave you a clear view on the direction of operation and the progress we are making with our portfolio, and we look forward to interacting with you at an upcoming date probably during our first quarterly result. Thank you very much and have a great day.

Okay. Thank you, everyone. That does conclude our conference for today. Thank you all for participating. You may all disconnect.