Can we go ahead and get started with our next session? My name is Chris Raymond. I'm one of the biotech analysts here at Piper Sandler. Very pleased to have with us our next company, presenting company IO Biotech Inc. We have Qasim Ahmad, the CMO, and Amy Sullivan, who's the CFO, presenting for us this morning. Just a quick overview of the format. This is a fireside chat style presentation, so very informal. This is meant to be participatory. So if anybody in the audience has any questions, please raise your hand, and I'll make sure your question gets asked and answered. We're going to start out with just to level set the discussion, a brief overview of the company. Amy or Qasim, if you want to provide that, and then we'll dive into questions. So take it away.
Thank you very much. Thank you. So IO Biotech was founded exactly 10 years ago. So this is our 10-year anniversary. We are currently in phase III with our lead assets, the IO-102, IO-103, IDO, and PD-L1 vaccine. The platform is basically a T-win platform, where it's just like a cancer vaccine, like a typical cancer vaccine. We target the tumor cells as well as the immune suppressive cells within the tumor microenvironment with the targets. Irrespective of the target, the hypothesis is that we basically engage the T cells, and the T cells then lead to the activity by expansion of T cells targeting those specific antigens, in this case, the IDO and the PD-L1.
Excellent. OK. So maybe we'll just dive into questions. I want to ask about your specific programs. But maybe before we do that, Qasim, maybe just I wanted to dive into your T-win platform. This is a proprietary development platform. Talk a little bit about how this works, what makes your approach maybe different from other efforts in the space, and those that have maybe not been successful.
Yeah. I think when you refer to our platform, basically the vaccines, it's an immune modulating vaccine. So just to sort of put the mechanism of action into perspective, the vaccine itself has dual mechanism of action. It engages the T cells within the tumor microenvironment, which then acts on the tumor-associated macrophages and other related cells within the tumor microenvironment. The vaccine converts the environment into a pro-inflammatory and an anti-tumor environment, hence potentiating both the effect of the vaccine as well as when we combine it with an anti-PD-1, it synergizes with that.
Okay. So let's maybe then talk about your lead program, IO-102, IO-103, which is a dual cancer vaccine. It utilizes PD-L1 and IDO. First, let's just start with IDO. Obviously, it's a target that has a little bit of a checkered past. Epacadostat, obviously, a lot of investors have a memory there about what happened. But just remind us of your view of this as a target, why it's really a valid target to continue to pursue, especially given that history.
Yeah. When you look at compounds like epacadostat or other inhibitors of tumor, they act by either inhibiting the target itself or by directly targeting the tumor cells. Whereas in our case, as I was telling earlier on, the vaccine basically engages the whole tumor microenvironment. The T cells are engaged in a different manner than just direct hitting and inhibition. So the dual mechanism of action leads to both the direct and indirect killing of tumor cells as well as the immune suppressive cells within the tumor microenvironment. And knowing obviously the background around the immune suppressive cells, which are already sort of not letting the direct anti-targeted therapies impact on them, we hypothesize that the mechanism of action sort of makes it unique in that sense that it's addressing it in a very different manner than a targeted therapy would do.
OK. And then, so you're also targeting PD-L1, but you're utilizing your agent in combination with Pembro. Talk a little bit about the mechanistic rationale for that.
Yeah. So first, let me explain also the two vaccines as well, because it's addressing the IDO and the PD-L1. And then we are combining with an anti-PD-1 as pembrolizumab in our current phase III. So we see synergy for both our vaccines to work together, because both of them address different parts of cells within the tumor microenvironment. And then when we add it on top of an anti-PD-1, we basically see synergy by making the tumor more pro-inflammatory, which enhances the activity of a drug like pembrolizumab.
Let's talk about the data that you guys have generated in metastatic melanoma. A few years back, you had what is objectively impressive data, especially when you compare it to Ipi and Nivo in first-line melanoma. The pushback that I'm sure everyone's aware has been that it's a single center, 30 patient study. There's a lot of skepticism as to whether that's a real signal. Maybe just to level set the discussion on the opportunity in melanoma, explain a little bit about the data that you had and why that was the springboard to start your pivotal study.
Yeah. So even going a little bit before that, when we started the clinical development program, we had early signals in lung cancer, even with monotherapy in other tumors as well. That led to this phase I/II study that you are referring to. It's called MM1636. It was a single center study with 30 patients in first-line advanced melanoma, response rate of 80%, complete response is 50%, a PFS of 25.5 months. And the responses were deep and durable as well. If you look at the standard of care, even right now, with Ipi/Nivo being the standard of care and Opdualag as the, I would say, the emerging standard of care in this setting, PFS ranges between 10 and 11 with most cases.
Keynote-006, which was the first pembrolizumab trial, which actually is the comparator that we are using in our study, had a PFS of 11.6 months in that setting. Response rates have been in the range of 46%-55%, 56% in this setting. Overall survival is maximum with ipilimumab, nivolumab. Each one of the therapies with the current, except for the monotherapy, the combinations come with a lot of toxicity. There is still a high unmet medical need in melanoma first-line setting, with at least half of the patients either not responding or recurring afterwards, so there's a need for newer therapies, and that's where we basically come in with our profile. Now, coming back to MM1636 and its relevance, so not only did we see overwhelming response rate and complete responses, the durability of response and the PFS data also was quite encouraging.
It led us to FDA Breakthrough Therapy designation. Up until now, at least, I am not aware of a phase I/II study that had this robust data. This basically led us to advance straight into a phase III program rather than the traditional phase II and a phase III. And maybe I can share more about the trial itself later.
Yeah. I want to ask about the phase III, and maybe just a question for Amy, since you're an investor-facing person primarily. This is a statement and a question, I guess. So to your point, your breakthrough designation from FDA, they don't just hand those out arbitrarily. We've talked to a number of KOLs who we posed this exact question, single center study, not a ton of patients, is it real? And overwhelmingly, the response has been, yeah. This is exciting and very interesting. But investors have been not particularly enthused about it. So is it really just that, those two components, single site? Or is there some other aspect that you think you're hearing from folks when you see the skepticism?
No, I think it is just that. That and you mentioned IDO earlier, and those would be the primary pushbacks that we would get. I think when you look at the data that we have delivered since then in multicenter global phase II studies and two additional indications now, that should give people more confidence in the fact that that original data were indeed real.
Interesting. OK. So let's talk about, I guess, when we get that card turned over, that it is real, your phase III study. So you mentioned we can talk a little bit about the design and the execution there. In fact, in September, you had an interim analysis that did not hit stat-sig on its, which is a very high statistical bar. I'm looking here, two zeros before the five. So obviously, a very high bar. But your stock still went down on that. I didn't anticipate anybody gave it a chance. But maybe just talk about the setup into that event and why you saw the reaction that you saw, Amy, on the stock.
So I think the reaction was not necessarily in line with how it should have been appeared. We were very proactive in terms of giving guidance and setting that bar as a very high bar for a potential hit there. So the statistical significance of 0.005, we saw it as upside. I think all of our analysts communicated that as well. Unfortunately, I mean, most of our trading, not unfortunately, but most of our trading is really driven by retail investors. So I think any negative headline or something perceived negative could trigger that type of trade-off.
100%. OK. So yeah, we talked about this earlier. In line is the new metrics, right, in this biotech environment. But just on the final PFS, so the studies continuing to the final PFS, still guided. You guys are talking about first half of next year, obviously very near term, and you actually pulled it forward and over-enrolled. So maybe just talk a little bit about the enrollment dynamics that drove that decision to pull it forward and the upsizing.
Yeah. So when we started the trial, the initial sample size was 300 patients. We had feedback from our steering committee as well as other investigators. And during the course of the study, we basically very early on amended the protocol and changed the sample size to 380. We ended up recruiting 400+ patients in the study. And while we were doing this and with the projections on our stats plan, it basically drove the overall projection of when the events would happen. Sample size initially was relatively small for a study like this. Since it's fully powered for PFS as a primary endpoint with 89% power and 0.65 hazard ratio, we are now comfortable moving that sort of projection to first half of next year.
OK. And do you have a sense as, I mean, obviously stat-sig is the goal, but management teams are loath to sort of provide a bar or success bogey. But any sort of sense there about what we should be thinking about in terms of the final PFS readout?
Yeah. So obviously, our main competitor in the study is pembrolizumab with a 0.65 hazard ratio, depending on the PD-L1 status in the study. We've seen Pembro readouts anywhere between 4.9-11.6 months, depending on how high the PD-L1 was in terms of the overall patient population percentage. So we expect to show both clinical and statistical significance on top of that with this hazard ratio. We also hope that it will be better than Opdualag and the Ipi/Nivo PFS.
OK. And then so the setup would seem to be relatively straightforward. If you hit on PFS, you can file in the U.S. Talk about the regulatory setup outside the United States.
Yeah. So we are currently working on the strategy of outside of the U.S., especially Europe and then the rest of the world. So those are part of our discussion. The FDA discussions were more advanced because we were doing the interim analysis with the hope that if we did meet that 0.005 p-value, we would actually be able to go for an accelerated approval based off of that. Hence, our discussions with the U.S. are actually more advanced.
OK. So let's maybe talk about the market opportunity. Let's just assume it hits and you're off to the races in terms of filing. Kind of an interesting setup, I think. You've got your initial treatment period, but there's a maintenance dose, Amy, period. Talk about the market opportunity as you see this mix in melanoma. I mean, front-line melanoma, obviously, pretty big, but there's always slicing and dicing, I guess, involved there.
There is. So when we look at the market, the first-line market is quite large with Ipi/Nivo and Opdualag really leading the charge there. I think in terms of market size, we're talking about billions of dollars. We see Opdualag as the most recent market entrant. And they're at this point on a run rate, I think, to about $750 million in revenue this year alone, and they're in their second year of launch. When we think about dosing, we don't really think about it as a maintenance dose. Our clinical trial is designed to follow the Pembro schedule, and we're actually treating patients for up to two years with the vaccine in combination with Pembro, so very much following the Pembro dosing regimen. So we would expect that to be the same that we would see in practice when we're on the market.
OK. All right. And then, so beyond melanoma, you have a phase II basket study ongoing in PD-L1 high non-small cell lung cancer and also head and neck. You gave an update in the lung cohort at SITC. Maybe just walk through those most recent data in lung and talk about how sort of the data has evolved over the past year.
Yeah. So basically, it's a basket study with one cohort in head and neck, which is also CPS high and in lung cancer. The totality of data is quite encouraging for both the cohorts combined together, but also looking at them independently. First at ESMO, we presented the head and neck data. It met the primary endpoint of response rate, almost doubling the response rate that we have from pembrolizumab alone in this setting, which is around 23%. And we have 44%, 44.4%. We also had significant improved PFS in this setting as well in head and neck. Then at SITC, just a few weeks ago, we presented the lung data. And it's encouraging both for response rate as well as for PFS. We are going to continue to follow both the cohorts for durability of response as well as for two-year PFS next year.
We have some encouraging input already from some of the medical experts, especially in the U.S., for an interest to expand the head and neck program into a randomized trial, and we're just under some discussions right now.
Getting back to lung, for your next follow-up, again, a question that I think management teams generally don't like answering, but just sort of frame success or what would you need to see to feel confident you're seeing a signal over the backbone of Pembro?
As we are getting more and more data, especially following the MM1636 melanoma trial now with these two cohorts, we are seeing that patients' PFS, stable disease, as well as duration of or durability of response actually could be valid endpoints to look for, especially hard-to-treat patient population. So for lung specifically, we would look forward to the DOR and PFS maturity next year. And by that time, we will obviously have the phase III study readout as well, which will guide us in terms of the next direction.
OK. And then pivoting back to head and neck, you haven't really necessarily per se guided to the next sort of catalyst on this study, but just maybe talk about how the cadence in general terms was in terms of the next readout.
Ideally, if I can say that. Ideally, if we had money, we could actually have started the next study. We are in discussions on basically putting the plan in place. Top key opinion leaders are encouraging us to go into the next phase for head and neck.
OK. Maybe just to touch on safety. So it looks you've been relatively consistent as you've progressed through various tumor types and sites and studies. There was a death report at last year's ESMO from the lung and head and neck cohorts. You've discussed this case, a patient who had a history of thromboembolic events and discontinued treatment. Just maybe talk a little bit about that and what you're seeing in a broader sense on safety.
Yeah. So up until now, we have had five IDMCs on the phase III study. The last one was actually part of the interim analysis as well. In totality, for all the ongoing trials, all our sponsored studies, which is the basket trial, the melanoma phase III trial, a neoadjuvant study in melanoma and head and neck, and some ongoing investigator-initiated trials, one of them is at MSK. We actually are very consistent in terms of the safety profile. We do not see any new safety signals, no added significant systemic toxicity. The IDMC declared that without changing anything in our protocols, we basically continue to PFS in the phase III trial as well. As part of our routine safety surveillance, we conduct all necessary steps that are needed.
So especially as you are mentioning about this case, which was in the lung cancer cohort, we carried out a full analysis of all the trials and all patients. And we did not really see any new signals that would worry us.
OK. Let me pivot maybe to another program you guys have that's a little bit earlier stage, IO-112. So this targets arginase 1. And this is a vaccine, again, designed to activate and expand arginase 1 specific T cells. This is highly expressed on notoriously difficult-to-treat tumors. Just maybe walk through your rationale choosing this target, specifically given that attribute?
Yeah. So I think you rightly said it is widely expressed across tumors, especially we see overexpression in renal cell carcinoma and head and neck, even in pancreatic cancers as well. So obviously, that makes us attractive. From most of the preclinical work that we have done, we see activity with the vaccine. And it works pretty much similar to the T-win platform. So it's basically engaging the tumor-associated macrophages. Basically, the T cells are engaged. The T cells then act on the specific arginase 1 target. We presented some preclinical work this year, and some work was presented earlier on as well. We see a clear signal there of activity with the vaccine. And just to also put into perspective, there were two phase I studies done independent of us at the University of Copenhagen at CCIT in two different settings.
So it also showed the safety profile of the product itself. We now, with all the preclinical package in place, are going to proceed with IND-enabling next year with the compound.
Okay. Maybe one final question. So Amy, it's pretty apparent you've got more programs than cash to fund. And this is an obviously age-old question, balancing the need to finance all this activity. Just talk a little bit about maybe the runway and your optionality going forward.
Yep. So at the end, we ended the third quarter with just over $80 million in cash on the balance sheet. That takes us into the fourth quarter of 2025. So through key critical data points, I think especially around the phase III study, we will look for sources of non-dilutive capital between now and then, potential partnerships and other potential ways to raise capital, partnerships around IO-102, IO-103 regionally, also potentially partnering the earlier stage compounds. And then we would need to raise money. Yeah, to support preparation for commercial activity as well as funding these additional studies and additional indications.
OK. Excellent. Well, obviously, a very important readout in the first half of next year. So we wish you the best of luck.
Thank you.
Thank you.
Thanks.