Innate Pharma SA

PAR:IPH

Earnings Call Analysis

Earnings Call Transcript 2023-Q3

[Operator]

Thank you for standing by, and welcome to the Innate Pharma Third Quarter 2023 Financial Results and Business Update. I would now like to welcome Henry Wheeler, VP, Investor Relations and Communications, to begin the call. Henry, over to you.

[Henry Wheeler, executive]

Thank you very much. Good morning, good afternoon, and welcome, everyone. This morning, Innate issued a press release for our Q3 financial results and business updates. We look forward to highlighting the progress made year-to-date as well as addressing future goals and milestones. The press release and today's presentation are both available on the IR section of our website.

On Slide 2, before we start, I'd like to remind you that we will be making forward-looking statements regarding the financial outlook in addition to regulatory and product plan development. These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted.

On Slide 3, on today's call, we will be joined by Mondher Mahjoubi, our Chief Executive Officer. Then we are pleased to welcome Sonia Quaratino, our new Chief Medical Officer, who will cover updates on lacutamab and monalizumab. We'll then hand the call over to Yannis Morel, EVP of BD and Product Portfolio Strategy, who will then discuss our ANKET and ADC platform updates. We also have Frederic Lombard, our CFO, on the line for Q&A.

Mondher, I'll now hand the call over to you.

[Mondher Mahjoubi, executive]

Thank you, Henry. Good morning, good afternoon, everyone, and thank you for joining us on this call. Please move to Slide 4. So it is a reminder of our strategy. As an early clinical stage company, our business model centers around 3 key priorities where we look to drive value from our early R&D efforts through later-stage partnerships where it makes sense to do so. Our ambition is to develop innovative drug candidates that contribute to transform cancer care through a strong pipeline of differentiated antibodies.

Firstly, we look to create near-term value driven by our lead proprietary drug candidate, lacutamab, which is in clinical development for T-cell lymphoma with updates coming at this ASH meeting, including final CTCL and early PTCL data. As a reminder, our focus remains to leverage the value of our products as much as possible, which will further validate our science and offer capital that we can reinvest to advance our early R&D engine.

We want to make sure that if we can gain valuable competencies, via a partner agreement for lacutamab, we will consider that in our development plans for the product as we look to later-stage trials as we have done in the past for other partnered assets.

Second, we continue to fuel our pipeline and create longer-term value by leveraging our antibody engineering capabilities to develop innovative molecules with a primary focus on ANKET, our multi-specific NK cell engager proprietary platform, and we are pleased to see continued progress with Sanofi presenting various updates for the Lead ANKET program, SAR443579 this year at ASCO, at ESMO and also upcoming at ASH.

We also look to move our lead proprietary and ANKET IPH6501 toward Phase I trial this year. Moreover, as we develop antibody targets for our ANKET platform, we recognized that some of these binders may be more suitable for antibody drug conjugates therapeutics.

And we announced some further updates in our ADC pipeline today. Last but not least, we are building a strong and sustainable foundation for our business with various partnerships across industry and academia. And here, our AstraZeneca partnership with monalizumab is progressing well in lung cancer.

Before I hand over to Sonia, on Slide 5, you have a summary of our pipeline which shows how we continue to translate our science into a robust portfolio of proprietary and partnered assets. But it also illustrates how we are executing against our strategy with our lead proprietary asset, lacutamab ANKET and Emergent ADCs supported by partnered products with AstraZeneca, Sanofi and Takeda, from late to early stage development.

We anticipate a series of potential clinical data readouts and catalysts in the upcoming couple of years as our R&D engine looks to leverage our scientific know-how to create sustainable business.

I would like now to pass the call over to Sonia, who will review the progress made with our portfolio starting with lacutamab, our most advanced proprietary asset. Sonia?

[Sonia Quaratino, executive]

Thank you, Mondher. On Slide 6, let me summarize the progress we are making with lacutamab, our KIR3DL2 antibody. In T-cell lymphoma, we are pursuing a fast-to-market strategy for lacutamab in the niche indication of Sezary syndrome where lacutamab was granted U.S. Fast Track designation and EU Prime designation in 2020.

We have expanded past Sezary syndrome for mycosis fungoides, and we have seen encouraging preliminary data from our Phase II trial in both diseases. For the Sezary syndrome, we announced early this month that final data is due at ASH next month, and we expect to have final data now for the mycosis fungoides later this year.

Finally, we continue to enroll patients with refractory/relapsed peripheral T-cell lymphoma in Phase Ib with lacutamab monotherapy and in a randomized Phase II with lacutamab in combination with chemo and some update will also be presented at ASH. We announced earlier this month that the U.S. FDA placed lacutamab trial on a partial clinical hold due to one case of hemophagocytic lymphohistiocytosis in the TELLOMAK trial, and we are currently undertaking efforts to address the FDA request and carried out an in-depth analysis of the HLH case together with the standing committee with independent experts, which point to the fact that the case is related to the aggressive disease progression.

On Slide 7 we have the final efficacy data in Sezary syndrome that have been accepted for oral presentation at ASH. The abstract details that in this heavily pretreated post-mogalizumab patient pool with a medium number of 6 prior therapies. The global overall response rate was an encouraging 37.5%, as can be seen on the waterfall plot on the slide and then overall response of 46.4% in skin and 48.2% in blood.

We also observed a clinical benefit rate of 87.5% and the medium progression-free survival of 8 months. It was very encouraging to see efficacy confirmed in the larger Phase II trial in these late-line patients together with a favorable safety profile. We look forward to sharing the full presentation at the ASH Annual Meeting in San Diego and sharing the data with the regulatory authorities.

Next, I would like to update you on monalizumab, an asset we have licensed to AstraZeneca. To remind you, monalizumab is an anti-NKG2A, which acts upon the checkpoint pathway to potentiate NK cells and activate tumor infiltrating CD8 T-cells. On this slide, you can see an overview of the late-stage development plan for monalizumab in lung cancer.

Building upon the data of the Phase II COAST trial, AstraZeneca commenced PACIFIC-9, a Phase III trial of durvalumab alone or combined with monalizumab or oleclumab, an anti-CD73 antibody as consolidation therapy for patients with unresectable Stage III non-small cell lung cancer who have not progressed after concurrent chemoradiation. The Phase II COAST study had a similar study design to the PACIFIC-9. The results of an interim analysis after a median follow-up of 11.5 months were published in Journal of Clinical Oncology in 2022.

The results showed that the primary endpoint of confirmed overall response rate by investigator assessment, was 35.5% with durvalumab plus monalizumab versus 17.9% with durvalumab alone. PFS was prolonged for durvalumab plus monalizumab versus durvalumab alone with a hazard ratio of 0.42. And 12-month PFS rate was 72.7% with durvalumab plus monalizumab versus 33.9% with durvalumab alone.

The AstraZeneca-sponsored NeoCOAST-2 study is also underway in an earlier stage in lung cancer, evaluating monalizumab and durvalumab with chemo in the neovaduvant setting.

I will now hand over to Yannis to cover our ANKET and ADC platform.

[Yannis Morel, executive]

Thank you, Sonia. On Slide 9, I wanted to highlight our proprietary NK cell engager platform that we call ANKET. ANKET standing for antibody-based NK Cell engager therapeutics. ANKET is a versatile fit-for-purpose technology made of antibody building blocks that is creating a new class of multi-specific engager to induce synthetic immunity against cancer. This technology platform, which is leveraging our scientific expertise in the NK cell space is an engine for us to create a series of drug candidates addressing multiple tumor targets. .

The backbone of the ANKET platform consists in the unique engagement of the activating NK cell receptors, NKp46 and CD16 on the NK cells which allows for optimal harnessing of the NK cell functions. In addition, this mechanism can be further increased by the addition of the IL-2 variant in order to induce NK cell proliferation.

On Slide 10, I wanted to share our enthusiasm for this platform. As you can see, our pipeline of ANKET molecule is significantly growing, with Sanofi having now licensed 3 molecules with 2 of them in the clinic and having an option on 2 other undisclosed targets. Also, our most advanced proprietary ANKET, IPH65, which is targeting CD20 and is armed with an IL-2 variant as cleared IND and is currently starting Phase I. In addition, we have several proprietary preclinical programs against multiple targets.

On the right panel, you can see the detailed mechanism of action of the ANKET molecules which we have published in a couple of articles in high-impact journals. Our natural biotechnology paper published in January this year described the joint work with Sanofi on the CD123 NK cell engager, IPH6101 or SAR'579.

SAR'579 is a core engaging NKp46 and CD16 on NK cells and therefore, triggers potent antigen-dependent killing of IML tumors as well as production of key cytokine for the antitumor immune response, but without inducing the systemic cytokine release, which is a dose-limiting feature of the T cell engagers.

Moreover, we have shown in our Sanofi report medicine paper that the incorporation of an IL-2 variant into a ANKET induce a preferential NK cell proliferation within the tumor microenvironment increasing, therefore, the number of antitumor effector NK cells.

On Slide 11, you can see another view of the clinical data presented this year at ASCO and ESMO and also the abstract that has been accepted for presentation at this year's ASH meeting for the CD123 ANKET program also named SAR443579. In the ASH abstract, we were encouraged to see further single agent activity and safety for the SAR'579 in relapsed/refractory IML patients.

Additional complete responses were observed with now 5 complete responses out of 15 patients treated at the 1 mg per kg dose levels. SAR'579 was well tolerated at those up to 6 mg per kg with no dose-limiting toxicity observed and only 2 grade 1 CRS observed out of 43 patients. We look forward to the full presentation at ASH.

In the ESMO update, 2 of the complete responders previously reported at ASCO remain in remission after 8.8 and 12.2 months after treatment, highlighting the durability of these responses. The FDA awarded SAR'579 Fast Track Designation in May, and Sanofi plans to evaluate further dose levels. We look forward to further updates from Sanofi in due course.

On Slide 12, you can see a summary of our Sanofi alliance. In 2016, we signed an initial agreement for 2 ANKET molecule up to -- worth up to EUR 400 million in milestones among which we announced EUR 60 million to date. Both programs have progressed with SAR'579 and SAR'514 now in Phase I clinical trial.

In December last year, we signed a further agreement whereby Sanofi license the IPH62 ANKET program targeting B7-H3, a solid tumor target with an option on 2 other undisclosed targets. Sanofi paid EUR 25 million upfront with EUR 1.35 billion in total milestones plus royalties. This now takes the total milestone package of our collaboration up to EUR 1.75 billion plus royalties. We look forward to working with Sanofi as we bring this new ANKET to the clinic.

Slide 13 highlights our growing ADC pipeline. As we continue to develop next-generation therapeutics, utilizing our antibody engineering platform, we find that for some tumor targets, we can generate antibodies more treated for ADC than for ANKET especially when they show good internalizing properties. Our agreement with Takeda in the field is providing a validation to this research approach and highlights our capability to generate differentiated ADC conjugates.

On Slide 14, I wanted to give you some more details on our Nectin-4 targeted ADC, IPH45 as we prepare the IND. We have selected an antibody targeting a unique epitope, which is not competing with the one of enfortumab vedotin or PADCEV, and we are using a top-1 payload with a stable and hydrophilic linker. These key scientific attributes for IPH45 translate into features that we have -- that have the potential to maximize the next info opportunity across various solid tumors.

First, in preclinical models, IPH45 has demonstrated a larger therapeutic index and a longer PK compared to enfortumab vedotin, which could improve the dosing regimen and aim at a better safety profile in patients. Second, as shown on the graph on the right, IPH45 shows strong antitumor efficacy in preclinical in vivo model resistance to enfortumab vedotin suggesting that IPH45 could be active in patients refractory or relapsing after EV or other MMAE-based therapeutics.

Last, the bystander effect of the top 1 payload selected together with the increased therapeutic index suggests that IPH45 could address multiple tumor types across various Nectin-4 expression levels. Altogether, IPH45 has a unique profile with promising preclinical data that could translate into better patient outcomes across indications and lines of treatment.

I will now turn to MOndher for a summary.

[Mondher Mahjoubi, executive]

Thanks, Yannis. Please move to Slide 15, where we highlight the updates we are looking forward to at ASH in a few weeks' time in San Diego, where we will share the lacutamab updates, and Sanofi will present SAR'579 ANKET updates. We also plan to host a KOL call on site during the conference, and we look forward to further discuss on the lacutamab data with you.

So let me summarize now and maybe if we move to Slide 16, you may be familiar with this slide. We continue to work diligently to execute across all our strategic pillars, and we believe that we are laying the foundation to drive near- and long-term value. Looking at our clinical program, we expect to achieve a number of milestones over the next 2 years.

As you've heard from Sonia, lacutamab Phase II TELLOMAK final Sezary syndrome and MF data is due at the end of this year, in addition to initial PTCL data. In parallel, we continue to develop our ANKET platform, further reinforced by our partnership with Sanofi, and we are very encouraged by the initial clinical data presented at Congresses this year and the IND clearance for our proprietary ANKET, which is progressing toward the clinic. We believe that this represents a natural evolution of our platform.

Last but not least, for monalizumab, the lung cancer trials are underway, and we continue to advance the adenosine pathway agents in the clinic where the Phase II for IPH5201 in early lung cancer is underway.

Let's move to the conclusion slide, please. As you can tell, we continue our exciting journey at Innate. We look to build our business to create value for patients and stakeholders. In summary, we have positioned Innate Pharma for the future with our strategy and made meaningful progress across all 3 strategic pillars.

With our R&D engine and antibody engineering expertise, our science is producing more candidates to progress to the clinic. So we are developing alone. Some we are developing alone and some partners. We have a focus on our NK cell engager platform, ANKET, as well as antibody drug conjugates. But in parallel, our late-stage portfolio continues to advance, and -- as we look to maximize the late-stage portfolio assets of both lacutamab and monalizumab.

Second, our partnership strategy continues to evolve with the Takeda deal add in to those of AstraZeneca and Sanofi. Finally, we have -- we continue to carefully manage our resources so we can continue our sustainable business and invest in progress in our pipeline.

I'm very pleased that we continue to have a strong cash position with a runway into the second half of 2025. So collectively, we are driving value across our business and finally, 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.

[Operator]

[Operator Instructions] Our first question comes from the line of Daina Graybosch with Leerink Partners.

[Unknown Analyst]

This is [indiscernible] on for Daina. What is your view of SAR443579 or IPH61 dosing profile to date? And how do you think that reads through to the ANKET platform more broadly?

[Mondher Mahjoubi, executive]

Thank you. Probably, Yannis is the best person here to answer the question about the dosing profile for 61 and beyond that, of course, the rest of our ANKET drug conjugates.

[Yannis Morel, executive]

Yes, the data that had been presented by Sanofi up to date at the ASCO, but also more recently at the ESMO showed that the clinical responses were observed at the court where the maximum dose was 1 mg per kg. The ASH abstract also report additional response at 1 mg per kg, but not at higher doses.

This suggests a potential [indiscernible] effect on the drug. And like you can see in the abstract, more details on that should be presented at the ASH meeting. But if you look back at the ESMO presentation, there were blast reduction at all doses tested. What it tells us is that we may for -- I mean, on a target per target basis, because a multi-specific engager is binding on 1 side to the tumor, but on the other side on the NK cells.

You may adapt the dose in the Phase I from 1 target to the other. But it's not something that is unusual. There has been also some example recently, for example, with the tarlatamab from Amgen, where the 10 mg flat dose showed better results than the [indiscernible] flat dose in small cell lung cancer.

[Operator]

Our next question comes from the line of Yigal Nochomovitz with Citi.

[Carly Kenselaar, analyst]

This is Carly on for Yigal. For lacutamab, we wanted to get your latest thinking on the next steps for CTCL. I think in the past, you've talked about the potential for the Sezary cohort to support an accelerated approval pathway. So just curious if that's still part of the plan? And then what different scenarios could look like for mycosis fungoides as well in terms of future studies?

[Mondher Mahjoubi, executive]

Yes, I'm going to take the question. So as you know, our aim is to pursue the development of lacutamab beyond the Sezary syndrome. The mycosis fungoides cohort in the TELLOMAK trial is a signal detection study because we didn't generate previously data outside Sezary syndrome. So this is the first prospective controlled Phase II study to generate additional data outside Sezary.

And of course, our main goal is to make sure that lacutamab gets to the patient who needs a as quickly as possible. It's clear that in the Sezary syndrome given the orphan drug designation or of course, the fast-track designation as well as the prime designation in Europe. There is a significant unmet medical need, especially in those patients who are progressing after 2 prior lines of care, especially after mogamulizumab.

And clearly, the immersion data that we are generated and about to present to ASH will be discussed with the FDA in terms of potential suitability for accelerated approval and also the confirmatory Phase III strategy. building, as I said, on the existing first track of designation.

As you know, our business model, of course, is clear. further development and registration of this asset is something we intend to progress via partnership, leveraging the capabilities and expertise of a partner in area that we do not have existing capability of expertise. This will allow us to focus on our proprietary and innovative portfolio.

And we'll provide you updates as and when we can entrust, you understand the sensitivity only potential partnership prior to formal announcement. I also know that in our discussion with the FDA, we will certainly discuss about the confirmatory Phase III trial, which of course, will be including not only Sezary but clearly other formal CTCL, in particular, mycosis fungoides. I hope that addressed your question?

[Carly Kenselaar, analyst]

Yes, yes, perfect. And then just a follow-up question maybe on the Nectin-4 ADC program. It seems like you think there's potentially an opportunity in the post pads of setting here. Just wondering if you could talk a little bit more about early thoughts on the development strategy and then just time lines for bringing that into the clinic.

[Mondher Mahjoubi, executive]

Yes. Yes, indeed by actually switching the class of payload and going after Topo I inhibitor, we are seeing some pretty good efficacy in preclinical models after PADCEV, and I mean, in models that are resistant to PADCEV. And what is also encouraging for this approach is that there are some reports in the literature showing that patients who are relapsing to PADCEV are not losing the expression of the antigen.

So the antigen is still there, but it's more a mechanism of resistance again, the payload that is developing within these patients. So this is clearly one path that we, at some point, would like to explore in our clinical development plan, but it's not only the only 1 as the Nectin-4 can be also expressed in several other solid tumors that are so far showing pretty limited activity with the PADCEV and this leveraging the wider and larger therapeutic index of our compound.

And in terms of timing, we are actively working to file an IND next year with this one.

[Operator]

[Operator Instructions] Our next question comes from Arthur He with H.C. Wainwright.

[Yu He, analyst]

This is Arthur on for RK. So I just wonder for the 579 data at ASH. Could you give us more color on the safety side, especially for that grade 4 neutropenia. Could you give us more color on that?

[Mondher Mahjoubi, executive]

So I'm not sure I'm getting the question right. So far, actually, based on the abstract the safety profile of SAR'579 or IPH6101 was reported as favorable. There were 1 grade for neutropenia, but we don't have details more than what is in the abstract.

So clearly, something to ask when the data we'll present at ASH in a couple of days. But a reminder, those are heavily pretreated patients, median number of prior line of therapy most of the patients received venetoclax a significant number went through stem cell transplantation. And this is, of course, interesting to better understand the reason of this grade 4 neutropenia, whether it is disease related or drug related.

[Yu He, analyst]

My second question is I'm just curious when you are evaluating different binder, which is [indiscernible] for the ANKET or versus the ADC platform, what kind of criteria or selection preference for each side? Just curious from your perspective.

[Mondher Mahjoubi, executive]

I'm going to hand over to Yannis to give you a more detailed answer. But as we explained in the past, of course, some of the binders are more suitable for ANKET the ones that internalize actually are by design, favorable candidates for the ADC. But Yannis can give you more color on our thinking on how we select those binders.

[Yannis Morel, executive]

Yes, it's -- but it's obviously a target-by-target discussion because you know that some targets do have this property to internalize and some do not. And depending on this property of the target, the structure and the ability to generate binders that are hitting the target at different epitope. We can generate binder that rather staying at the sales pace and are a pretty good candidate for ANKET molecule and others that do internalized.

And this we are screening that in vitro with pretty classical methods that are widely used by people developing ADCs. And we are checking the ability to induce the direct killing based on the expression level of the target. So there are also many more parameters that we are taking into account like the medical need, the development path and the potential opportunity for this molecule. But in terms of antibody characteristic, this is really when we are using in one of our early filters.

[Operator]

Our next question comes from the line of Lisa Bayko with Evercore ISI.

[Jingming Chen, analyst]

This is Jingming on for Lisa. So I have 2 questions. So one is again maybe as listed the prepared remarks, but can you give us an update on your clinical hold for lacutamab?

And then my second question is for your PTCL update at ASH. What should be -- what will be an appropriate benchmark for this data?

[Mondher Mahjoubi, executive]

The first question is about lacutamab clinical hold, you said, I think, and probably it's time an opportunity for Sonia to provide an update on the partial clinical hold for lacutamab. And then I'll take the question on PTCL.

[Sonia Quaratino, executive]

Certainly. As mentioned before, the FDA placed the partial clinical hold due to one case of HLH that was reported in one subject. We, of course, intend to lift the partial hold as soon as possible once the FDA request that all been satisfied. However, this clinical hold or partial hole does not impact the TELLOMAK time lines because the recruitment in both mycosis fungoides and Sezary have been completed and the final data are imminent.

And for the PTCL, we have also recruited the let's say, first cohort of patients, and we are making an interim analysis of the data. And I have to remind that this HLH case that has been highlighted in the TELLOMAK trial is indeed related to transformation of the Sezary into a larger cell lymphoma. And as you probably know, HLH is commonly reported as a complication of cutaneous T-cell lymphoma.

[Mondher Mahjoubi, executive]

Thank you, Sonia. So for the second question, so let me first maybe go back a few years ago when we finished Phase I, at that time, we didn't have data outside Sezary syndrome. Most, if not all the patients included in the Phase I program had Sezary syndrome and of course, the obvious question, we are excited and we are still excited by the signal we've seen in Sezary patient.

But the main question was to see whether there is activity outside Sezary. And the logic next step was to go in cutaneous T-cell lymphoma outside Sezary and test the drug in mycosis fungoides. That was the priority #2, and that's what we will be communicating at the end of the year. As we said, we are on track to have the final data in-house in mycosis fungoides. But from the data published, the interim data published last year and updated even recently this year, we are confident that the signal is present actually when K3DL2 is expressed.

And hence, the potential for lacutamab to be used in the treatment of peripheral T-cell lymphoma. I remind you that almost half of the patients with PTCL do express K3DL2. We are running 2 trials in the difficult-to-treat relapsed/refractory setting.

One is a company-sponsored trial. It's mainly a safety Phase Ib trial that we are conducted and for which we will present an update in a couple of weeks at ASH.

And the second trial is an investigator-sponsored trial performed in collaboration with the Liza Group, and it's a combination trial. And I think the combination strategy in particularly in the relapse refractory is something very important.

We are, of course, excited by the preclinical data that we have generated and that we will be published at ASH, as I said, in a couple of weeks. We remain optimistic about the potential to run combination trials in the relapse refractory setting, but also in first line. And the plan, of course, is to expand the development of lacutamab in peripheral T-cell lymphoma beyond the difficult-to-treat relapsed/refractory, but that's the first step.

[Operator]

There are no further questions at this time. I would now like to turn the call over to Mondher Mahjoubi for closing remarks.

[Mondher Mahjoubi, executive]

As a concluding remark, I would say, a, we are very encouraged by the robust outcomes or lacutamabd in heavily pretreated patient with Sezary syndrome. Our discussions with the FDA will enable us to evaluate the potential for accelerated approval and to firm up Phase III plans. We are, of course, an ongoing dialogue with potential partners that can realize the full potential of the drug for patients with T-cell lymphoma, both cutaneous and peripheral T-cell lymphoma.

Second message, we are making great progress with our early stage pipeline. Pleased to see the progress of IPH61 or SAR'579 in AML with an update at the upcoming ASH. Pleased to announce that we have cleared the IND for IPH65, and we are waiting for the start of the Phase I this year.

And finally, as you've heard from Yannis, excited by our differentiated anti-Nectin-4 ADC with a top 1 payload, which is moving towards IND next year.

Last but not least, sufficient cash to fund operation into H2 next year with -- as of end of September, EUR 122 million, '25 -- sorry, yes, fund cash in H2 2025. Thank you very much.

[Operator]

I would like to thank our speakers for today's presentation, and thank you all for joining us. This now concludes today's call, and you may now disconnect.