Adaptimmune Therapeutics PLC

NASDAQ:ADAP

Earnings Call Transcript 2024-Q1

[Operator]

Good morning, ladies and gentlemen, and welcome to the Adaptimmune Q1 2024 Financial and Business Update Conference Call. I would now like to turn the meeting over to Ms. Juli Miller. Please go ahead, Ms. Miller.

[Juli P. Miller, executive]

Good morning, and welcome to our conference call to discuss our first quarter 2024 financial results and business updates. I would ask you to review the full text of our forward-looking statements from this morning's press release. We anticipate making projections during this call and actual results could differ materially due to several factors, including those outlined in our latest filings with the SEC. Adrian Rawcliffe, our Chief Executive Officer, is here with me for the prepared portion of the call, and other members of our management team will be available for Q&A.

With that, I'll turn the call over to Adrian. Ad?

[Adrian Rawcliffe, executive]

Thanks Juli, and thanks, everyone, for joining us for our Q1 call. I plan to provide some brief comments before we go into Q&A. The comments are going to be brief because a couple of weeks ago, we held an Investor Day, and we provided a fairly comprehensive update on the regulatory status of afami-cel as we move towards the PDUFA date of the fourth of August. And we also talked about how important this is for the field as the first approved engineered TCR T-cell therapy for a solid tumor indication. We also discussed our preparations for the commercial launch of afami-cel in some detail. And we said that we'd be ready to do this on approval of afami-cel and that this would be the beginning of a commercial sarcoma franchise that we feel has significant and underappreciated value. In this morning's press release, we provided a further update on the BLA progress, and our head of late-stage development, Dennis Williams is here for the Q&A portion of this call.

In short, our interactions with the FDA are progressing as planned, and we're looking forward to our late cycle review meeting in the second half of this month. Thus far, the FDA has not requested an Ad Comm or a REMS program. We look forward to the labeling discussions and also to commercialization in due course, and I'm happy to confirm that our customer-facing commercial and med affairs team are now fully in place. Cintia Piccina, our Chief Commercial Officer, is here for the Q&A as well. As I said, we are on track to be ready to launch on approval. We have a focused team starting at 6 to 10 treatment centers and ramping up to approximately 30 in due course. And if you revisit the Investor Day presentation by Dr. Mihaela Druta, which is available on our website, you will see that the expectations and anticipation for afami-cel within the sarcoma community are very high.

I think that sense of anticipation was reinforced by Philip Leider, patient advocate and President of the Sarcoma Alliance, who lost his sister to sarcoma. And he, I think, very eloquently highlighted the demand for novel therapies in this space. So we are scaling our manufacturing to be able to meet what we anticipate to be the launch volumes for afami-cel in the second half of 2024. And in summary, all is on track for the launch of afami-cel on approval. And that's expected around our PDUFA date in August and is highly anticipated by the sarcoma community. And obviously, we are very eager to get this product into the hands of this community that has worked so hard with us over the last decade to develop medicines for sarcoma.

Behind the afami-cel, we are also progressing the development of lete-cel, and I'll point you towards a presentation of the interim data analysis from the pivotal IGNYTE-ESO trial in synovial sarcoma and MRCLS that we previewed at a high level last year. These data look very similar to afami-cel other than, of course, they are in both synovial sarcoma and myxoid/round cell liposarcoma and that will be presented at a platform presentation at ASCO by Dr. Sandra D'Angelo. This will be an important milestone for people's understanding and the derisking of this cell therapy as we continue to move towards having a BLA in place in 2025 with anticipated approval for lete-cel in synovial sarcoma and MRCLS in 2026. You will see another press release from us this morning announcing that we've secured up to $125 million in debt financing with Hercules Capital.

With the first tranche of $25 million available on closing and the -- an additional $25 million available on afami-cel approval. In addition, you will have seen that in Q1, we raised approximately $30 million of the [ ATM ] based on significant inbound inquiries. We've taken these steps to secure our financial position and have cash runway into late 2025. And with this runway, we have the funds necessary to execute on our priorities. The launch of afami-cel followed by lete-cel and also executing on the other pipeline projects such as the Phase II trial with uza-cel for platinum-resistant ovarian cancer. And Gavin Wood, our Chief Financial Officer, is here for the Q&A as well. So with that, I'd like to turn it over to the operator for questions. Operator?

[Operator]

[Operator Instructions]. Our first question is from Jonathan Chang from Leerink Partners.

[Jonathan Chang, analyst]

First question, can you talk about the impact of the debt agreement announced today on your cash run rate guidance? I'm just trying to better understand what's assumed in the current guidance.

[Adrian Rawcliffe, executive]

So Gavin?

[Gavin Hilary Wood, executive]

Yes. Jonathan, so a number of things have changed since we last gave guidance at the start of the year. Clearly, we had the termination of the Genentech agreement, and we're still working through the terms of that termination agreement. We've made significant progress on afami-cel and the broader development of the broader sarcoma franchise. As Ad just mentioned, we've raised money under the ATM and we've also executed a new debt facility with Hercules. Putting all those moving pieces together, we thought it prudent bringing our cash runway by about 1/4 to late 2025.

[Jonathan Chang, analyst]

Got it. And what assumptions are there for how much of the debt is being drawn down?

[Gavin Hilary Wood, executive]

We grew down 25 closed -- $25 million closed and the $25 million available at the PDUFA date.

[Jonathan Chang, analyst]

Got it. And then second question, just can you help set expectations for the upcoming ASCO, IGNYTE-ESO presentation.

[Adrian Rawcliffe, executive]

Dennis, do you want to take that?

[Dennis Williams, executive]

Yes, sure. So for the ASCO presentation, we're going to be presenting results on the interim analysis of the pivotal IGNYTE-ESO trial. So this is 45 patients in that trial filed for at least 6 months. It's evenly comprised of patients with synovial sarcoma and myxoid/round cell liposarcoma. So will present the efficacy data and safety data that were available at that interim analysis.

[Operator]

A following question is from Marc Frahm from TD Cowen.

[Marc Frahm, analyst]

Maybe just first, nice that you're giving this detail along the way of the FDA review and the late-cycle review meeting coming up. Just can you kind of review what your closure strategy is going to be around some of the information that may be conveyed or glean by you guys at that meeting.

[Adrian Rawcliffe, executive]

So why don't I take a stab at that? So we're actually running pretty hard towards the -- both the late-cycle review meeting and the discussions on labeling that we anticipate and on post-marketing commitments, we're going to be focused on that in the run-up to the PDUFA date and I think if there's anything material that comes out from that, we will be disclosing otherwise, we're pushing hard for the discussions with the agency and getting to PDUFA and then being able to launch.

[Marc Frahm, analyst]

Okay. And then as you get into the [ on-going ] sessions, I mean, what do you view as the kind of major kind of questions and [ maybe ] answer about indications and things like and things to include or not including the label.

[Dennis Williams, executive]

Yes. So this is Dennis Williams. I think it's like I mentioned at the Investor Day some of this really comes down to individual sort of wording that goes in the label. Like for example, I'll give the follow-up in the example I gave in Investor Day, how we manage cytokine release syndrome, right? So we'll be talking about how that information should be structured in the label, how we give tocilizumab or how we would recommend that product and for what grade CRS. So sometimes it's really about the finer points of how the words are in the label. We have had no discussions to date with the FDA around the indication statement, and we feel very confident that the indication statement we proposed is more or less a few words as what we're going to end up with at the end of this review.

[Operator]

Following question is from Tony Butler from Rodman & Renshaw.

[Tony Butler, analyst]

I'm very respectful of the focus on afami-cel into a lesser extent on lete, but I wanted to ask about uza-cel and whether or not, at least in the calendar year, there was any anticipation of a follow-up on to pass through either in ovarian or in the Phase I with bladder, et cetera.

[Adrian Rawcliffe, executive]

So why don't I cover that with what we're thinking about for uza-cel. For SURPASS-3 in platinum-resistant ovarian cancer, that's designed with the potential to end up as a registrational trial. And therefore, we won't be putting out any data on that until we have at least enrolled all of the patients in that trial. There are interim reads for futility analysis, but we won't be communicating the data until we've at least enrolled all of the patients in that trial, which we anticipate being a 2025 event. I follow enrollment to that drug. So with respect to the other indications, so we're now focused down on to ovarian cancer in SURPASS-3 and the 2 other indications in head and neck and bladder and the objective is to gather data in a Phase I setting in a range of patients potentially in combination with checkpoint inhibitors as well. And what we've said there is we anticipate giving an update on the basis of the data that we've gathered at the tail end of this year about how we anticipate moving forward with those, which would include the data themselves.

[Operator]

Our following question is from Graig Suvannavejh from Mizuho Securities.

[Graig Suvannavejh, analyst]

Congrats on all the progress. Just wanted to go back to the FDA review process and in particular, also in light of the great analyst event or Investor Day you have down in Philly. Just curious if there has been any other perhaps progress? Or maybe any additional inspections by FDA on the manufacturing facilities? Do you expect any other visits prior to approval, just wanted to get a better handle on how things were shaping up there as it related to CMC manufacturing and your facilities.

[Dennis Williams, executive]

Yes. This is Dennis Williams again. So yes, I think at this point, all the inspections are expected to be completed, right? So we both manufacturing facilities that we utilize our own manufacturing for afami-cel drug product, the lentiviral manufacturing facility that we -- for the vector that supplies for drug product has been inspected. It's had a good outcome. And all the clinical trial sites that were inspected also are completed, they all had a very good outcome. And as I mentioned during Investor Day, the Navy Yard facility here from a GCP standpoint was also inspected. So at this point, we think all the inspections are complete. I guess there's always a scenario where another clinical site but could be inspected. But at this point, I think at this stage in the review, the inspections are completed.

[Graig Suvannavejh, analyst]

And just with regards to earlier comments, the company made about not anticipating or not expecting perhaps an Ad Comm or a REMS program, maybe just on the latter with regards to a REMS. Just from a calendar perspective, is this something that a discussion would naturally have happened by now? Or is it still part of potential discussion between now and the PDUFA.

[Dennis Williams, executive]

Yes. Sure. So we did not submit a REMS in this BLA application. And we've had discussions with the FDA during the review and I think at the time I had this discussion at Investor Day, the FDA review was ongoing, and there was no decision about REMS at that time, and they certainly had not asked for one at that time. You're correct that had a REMs been requested at that time would have elapsed already. That would have occurred within the few weeks of that mid-cycle meeting. I can just say, in general, the conversations we've had with the FDA, we don't anticipate a REMS for this product.

[Graig Suvannavejh, analyst]

Okay. And maybe just the last question, if I could. Just if you could remind us all assuming an on-time approval how we should be thinking about the shape of the uptake curve, particularly from a revenue perspective.

[Adrian Rawcliffe, executive]

So why don't I touch on that? Which is the -- what we basically guided to is that we've not given guidance on the specific numbers of patients that we anticipate coming through in the early part of the launch. What we have said is that it's important to understand that because this is an autologous product that's manufactured, need to be screened for targets and then manufactured and then return to patients. Whatever you think that uptake curve looks like it's essentially frame shifted by and we're guiding to about 1/4 from -- so the first revenues from afami-cel would -- the first patients would not be dosed treated and the first revenues recognized until Q4 this year, even though we anticipate approval and we anticipate starting to enroll patients from the PDUFA date in August.

[Operator]

Following question is from Michael Schmidt from Guggenheim.

[Paul Jeng, analyst]

This is Paul on for Michael. So on afami-cel launch, you talked about targeting about 6 to 10 sites for that early launch. But looking beyond this year, what's your current thinking on strategy for scaling up to all 30 ATCs across the country? And how many of those centers have had experience with the afami-cel in the clinical trial setting?

[Adrian Rawcliffe, executive]

I'll ask Cintia to talk to that.

[Cintia Piccina, executive]

Yes. So we are -- as Adrian said, we are targeting about 6 to 10 sites during the launch period, meaning the first quarter after launch. And we are already starting to engage beyond those with the expectation to have up to the 30 sites available about 18 months after launch. Out of these 30 sites in total, 16 of them, which will be the priority sites have clinical experience with afami-cel and some additional sites there part of the study also have experience with lete-cel. So all of our 30 ATCs in the future, all of our clinical sites from lete-cel and afami-cel will be part of those 30 and again, we know the dose sightsee the majority of the synovial sarcoma patients in the country.

[Paul Jeng, analyst]

Great. And maybe just a follow-up. As you look ahead to the launch, can you give us a sense of what kind of metrics you're planning to sort of disclose in the early months to give a sense of how that launch is progressing? This has been an area of focus for the Amtagvi launch for Iovance. So just curious if we can expect updates on a number of patients identified versus infused or if you're likely to provide more qualitative updates in the early months.

[Adrian Rawcliffe, executive]

We plan on updating that at our next Q call.

[Operator]

Following question is from Arthur He from H.C. Wainwright.

[Yu He, analyst]

This is Arthur for H.C. Wainwright. I guess I just had a broad picture question. So as we see the [indiscernible] industry moving to the autoimmune business area, could you help educate us the potential from your platform aiming for the autoimmune disease? I know you guys are laser focusing on the launch, but I'm just curious on the potential there.

[Adrian Rawcliffe, executive]

Sure. So as you've said, we are laser-focused on the launch. We have -- if you dig into the history of the company long enough, we have explored the opportunity to develop TCR targeted therapies for autoimmune disease, mostly focused on Treg programs. But I think in the short term, our focus is on obviously the launch of afami-cel and the sarcoma franchise, but also in between that and the very long-term future in autoimmune and maybe other indications, just the massive unmet need that can be addressed with TCR T-cell therapies in the oncology space. And if you look at the rest of our pipeline, you'll see that as we -- over the coming years, we will very quickly move from a sarcoma only franchise with 2 products and $400 million of sales into much larger patient populations.

And there's an opportunity with uza-cel in obviously, ovarian, bladder and head and neck. I think beyond that with PRAME, given the recent interesting data with that target, and with CD70, both of which are in the late preclinical pipeline. And the opportunity there to address over 100,000 patients that are currently dying from their indications with the right target and the right HLA type. And so when we see this in terms of horizons. Short term, sarcoma. Longer term, broaden that out, making cell therapies, potentially curative and mainstream across a broad range of tumors. And then taking cell therapies into other spaces where patients can benefit in other non-oncology indications in the long term.

[Operator]

Our last question is from Peter Lawson from Barclays.

[Peter Lawson, analyst]

I wondered if you could talk around the turnaround time, kind of time would be between kind of approval, booking the initial revenues as we think about the turnaround time, your end also the turnaround time with the hospitals and the patients and any variables that we should be thinking about?

[Adrian Rawcliffe, executive]

Cintia, do you want to talk to that?

[Cintia Piccina, executive]

Yes, absolutely. Yes. So when we think about the turnaround time from the patient journey perspective, we need to consider that the patients -- when they are identified, the first step is that they need should be tested for HLA and MAGE-A4, which is a process that can take a few days. Then we go through the apheresis process, scheduling apheresis. And then when we receive the apheresis material from a manufacturing turnaround time, then that would be of about 30 days and then shipping it back to the sites. So that's why at launch, the companion diagnostics that will be approved at the same time, that's our expectation at the same time that afami-cel is approved. So we would expect to see, as Adrian mentioned before, first patients dosed during the fourth quarter of the year.

[Peter Lawson, analyst]

Got you. Okay. And then asking the patients identified and the apheresis, what's the general time line you expect around that? I imagine there's a fair amount of variability.

[John Lunger, executive]

Yes. This is John, I'm the leading manufacturing. So the turnaround time from typical time from the collection of the apheresis material until the release of their product to send it back to the site tends to range between 4 and 6 weeks.

[Peter Lawson, analyst]

Okay. And are there things we should be thinking about the front end and the back end that are outside your control and kind of the sense you get, how long it takes for patients to kind of get through that funnel from being identified by diagnostic test for HLA. And then the other end once it gets to the hospital and actually get infused.

[Cintia Piccina, executive]

Yes. So a couple of things to consider before will be patient identification, the testing, then depending on where these patients are, they will have to be referred to a treatment center that can take a few days. Reimbursement is also something that will be checked at that very early part of the journey. Then from apheresis all the way back to infusion, it's mostly straightforward. We could have potentially the patient condition getting ores or other things that are out of control, but then it's mostly a little bit more straightforward.

[Peter Lawson, analyst]

Got you. And just, I guess, a final question just around the SURPASS data. I guess later this year, we get head and neck and bladder just the expectations around the number of patients we should see and kind of what you regard as a positive coming out of that -- those data sets.

[Adrian Rawcliffe, executive]

Elliot?

[Elliot Norry, executive]

Yes, thanks. We haven't guided to specific numbers that we would anticipate as it relates to patient dosing. We have said that we anticipate having sufficient data to make directional decisions regarding both of those indications by the end of the year.

[Operator]

Thank you. We have no further questions registered at this time. I would now like to turn the meeting over to Mr. Rawcliffe.

[Adrian Rawcliffe, executive]

So thank you, everybody, for your time today. Thank you for your questions. I look forward to seeing those of you at ASCO who are attending and look forward to updating you as we move towards approval and launch of afami-cel later on this year. Thanks a lot. Take care.

[Operator]

Thank you. The conference has now ended. Please disconnect your lines at this time, and we thank you for your participation.