Thank you, Simon. Hello, and welcome to Alligator Bioscience year-end 2021 call. This is Julie Silber, Senior Director of Communications and Investor Relations, and I will introduce today's call. On the call with me today is CEO Søren Bregenholt and CFO Marie Svensson. After a brief company statement by management, we will open up the call for Q&A. Before we begin, I would like to share a quick reminder to our listeners that during today's call, management may make forward-looking statements that involve known and unknown risks, uncertainties, and other important factors beyond the company's control that could cause the company's actual results, performance, or achievements to be materially different from the expected results, performance, or achievements expressed or implied by such forward-looking statements. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statement.
Actual results and the timing of certain events may differ materially from the results or timing predicted by or implied by such forward-looking statements, and reported results should not be considered as an indication of future performance. Please note that these forward-looking statements made during today's call speak only as of today's date, and the company undertakes no obligation to update them to reflect subsequent events or circumstances other than to the extent required by law. This call is being webcast and will also be made available through our investor relations website. With these formalities out of the way, I'd like to now turn the call over to Søren. You may begin.
Thank you, Julie, and good afternoon, and welcome to Alligator Bioscience year-end 2021 call. My name is Søren Bregenholt, and I'm the CEO of Alligator Bioscience. If we could go to slide three, please. Cancer touches all our lives, either directly or through its effect on family and loved ones. In 2021 alone, an estimated 90 million new cancer cases were diagnosed worldwide. Roughly one in four people will receive a cancer diagnosis during their lifetime, making cancer one of the leading causes of mortality and morbidity globally, accounting for more than 20 million deaths on an annual basis. Among these cancers, it's well known that one of the hardest cancers to treat is pancreatic cancer. Pancreatic cancer has one of the lowest five-year survival rates and therefore very poor prognosis. About one in 75 individuals will develop pancreatic cancer during their lifetime.
Roughly 30-40 million people in the U.S. and about 70 million people in Europe will be diagnosed with pancreatic cancer each year. Of these, less than 20% will be treatable by surgery, and the treatment options for the remaining 80% consist largely of chemotherapy. Addressing this clear unmet medical need is at the heart of everything we do at Alligator Bioscience. Alligator Bioscience specializes in the development of tumor-directed immune therapy, in particular agonistic monoclonal and bispecific antibodies aimed to stimulate the immune system and fight the patient's cancer cells. We develop these molecules for patients suffering from hard-to-treat cancers. During 2021, we continued to make great strides on our robust and diversified best-in-class pipeline of both pre-clinical and clinical stage drug candidate.
On slide four, we see that 2021 was a year of refocusing at Alligator, and we rounded out the year reaching several key milestones as we continued on our mission to bring innovative, more efficacious, more safe, and complementary cancer therapies to patients suffering from hard-to-treat cancers. We began the Q4 announcing the first patient was dosed in a phase II trial with the molecule AC101, a molecule that we have outlicensed to Shanghai Henlius Biotech in China. That was just one of the many key collaboration milestones that we announced during 2021. In November 2021, we announced the initiation of an exploratory phase I trial called REACtiVe-2. This is an investigator-initiated trial that evaluates our lead asset mitazalimab, a CD40 agonist, in combination with a cancer vaccine in patients with pancreatic cancer.
In December, we updated the market with positive readouts from the ongoing phase I clinical trial with our best-in-class 4-1BB agonist, ATOR-1017. During the quarter, we published scientific and clinical data on several of our portfolio assets, including posters on mitazalimab, ATOR-1017, ALG.APV-527, and Neo-X-Prime at the Society for Immunotherapy of Cancer, or SITC's Annual Meeting in Washington. We also published a paper in Nature Communications together with AbbVie and academic collaborators, providing further mechanistic insights to the efficacy of 4-1BB-targeting bispecific antibodies like aforementioned 527.
Throughout the quarter, I, together with the entire team, worked diligently to raise funds to support the continued development of our potentially game-changing therapies and successfully closed out the year with an oversubscribed rights issue, raising approximately SEK 257 million, of course, before the deduction of transaction costs. This will support our continued development of our pipeline. Now I would like to provide some details on these achievements. If I could have slide five, please. First, I would like to provide more detail on the progress we have made with mitazalimab, our lead asset. Mitazalimab is a best-in-class CD40 agonist aiming at stimulating the immune system in cancer. At the end of Q3 , we announced the successful advancement of this molecule, dosing the first patient in OPTIMIZE-1, the first phase I study in Alligator's history.
This was a big step forward for Alligator and for our best-in-class antibody CAR pipeline, of course. As previously announced, OPTIMIZE-1 is designed to assess the efficacy and safety of mitazalimab in combination with standard-of-care chemotherapy FOLFIRINOX for the treatment of first-line metastatic pancreatic cancer. OPTIMIZE-1 is an open-label, multicenter study that will enroll up to 67 patients at sites in Belgium and France. We most recently announced that all patients in the initial 450 microgram cohort of the study had been dosed and no dose-limiting adverse events were reported. The 900 microgram per kilogram cohort is recruiting as planned, and we remain on track to report the full safety readout later this Q1, with interim efficacy readouts planned for Q4 this year.
In the Q1 this year, we announced initiation of a sponsored research collaboration with Dr. Gregory L. Beatty at the University of Pennsylvania's Penn Pancreatic Cancer Research Center. This collaboration will study the biomarker data from the OPTIMIZE-1 phase II study. Moreover, this important collaboration will provide valuable insights into other clinical opportunities for mitazalimab. We are, of course, thrilled to welcome Dr. Gregory L. Beatty as a scientific advisor to Alligator Bioscience. In November 2021, we announced the initiation of an investigator-initiated trial, REACtiVe-2, and that the first patient was dosed in this trial. As I mentioned earlier, this trial evaluates mitazalimab in combination with a cancer vaccine for patients with pancreatic cancer. This trial is led by investigators at the Erasmus University Medical Center in Rotterdam, Netherlands.
The study will provide further insights into the mechanism and efficacy of mitazalimab and potentially expand the clinical utility of the molecule. Could I have slide six, please? Our second clinical asset is ATOR-1017 or 1017, a monoclonal antibody against 4-1BB that is being developed as a standalone and combination therapy for metastatic cancers. Novel biomarker data confirming its proof of mechanism from the ongoing phase I clinical trial were presented at ASCO and SITC annual meetings in June and November respectively. In December, we announced additional readouts from the ongoing phase I trial that corroborated and extended these previous data on biomarkers, safety, tolerability, and sustaining the safety profile up to and including doses of 300 milligrams with no dose-limiting toxicities reported.
These encouraging results strengthen the case for ATOR-1017 as well as confirms the proof of mechanism, and we believe that ATOR-1017 remain a promising candidate for immune therapy with enormous potential for combination with standard of care across a number of indications. Slide seven, please. Next, I would like to highlight Neo-X-Prime, our innovative bispecific antibody platform. Neo-X-Prime is based on Alligator's long-standing expertise in antibody discovery, bispecific antibody engineering, and CD40 target molecule biology. We see great promise in the Neo-X-Prime platform to drive further growth of Alligator, both as a proprietary part of our pipeline, but also as a partner platform. In November 2021, we presented data at SITC that highlighted the efficacy and safety of novel...
the preclinical safety of a novel, Neo-X-Prime, molecule, a bispecific antibody, targeting CD40 and the tumor-associated antigen CEA. The data showed that this molecule provides the delivery of neoantigen-containing tumor vesicles to antigen-presenting cells, thereby stimulating a tumor-specific T cell repertoire, resulting in potent antitumor efficacy. This was another important step forward in the development of our platform technology, as these data reinforce the robust potential of Neo-X-Prime and the derived assets. If I could have slide eight, please, I would highlight some of the progress we have made with our partner programs during the Q4 of 2021. As already mentioned, in October, we were pleased to announce that the first patient was dosed in the phase II clinical trial with AC101, or HLX22, as it's also called.
Alligator outlicensed this molecule to Korean-based AbClon in 2016, and the molecule was subsequently sublicensed for clinical development to Chinese-based Shanghai Henlius Biotech. Also, we presented together with Aptevo Therapeutics, the preclinical data on our collaborative molecule, ALG.APV-527 or just 527, which is a potentially first-in-class bispecific antibody targeting both 4-1BB and the tumor-associated antigen 5T4. These posters highlighted the preclinical data set and gave an overview of the potential indication landscape, mechanism of action, and safety profile of the molecule, which supported the molecule's progression into phase I clinical trial. Following that, we jointly announced the publication of a paper in the peer-reviewed journal Nature Communications, together with Aptevo and a Spanish academic group. This publication details the mechanism of action of the 4-1BB targeting bispecific molecules like 527.
During Q3, we announced the research and licensing agreement with Orion Corporation, based in Finland, to discover up to three bispecific antibody drugs using Alligator's technology platform. This is a deal with a total value of up to EUR 469 million. The project is on track, and during Q4, we progressed the project as planned towards the internal milestones. Could I have slide nine? We finished the year strong with an oversubscribed rights issue, raising approximately SEK 257 million. Use of proceeds from this rights issue will be allocated to expand and accelerate the phase II program for mitazalimab to support the preparation of phase II for ATOR-1017 as well as for the development of other pipeline candidates, such as the Neo-X-Prime platform and assets.
We are, of course, grateful for the continued support from existing shareholders, and we welcome our new shareholders to the Alligator family. I would also like to share that another outcome of this rights issue, which is that Alligator now has welcomed a new cornerstone investor based in the U.S., an investor with a long-term knowledge of Alligator, who will support the company for the long term and provide stability as we continue to develop our best-in-class pipeline. With this, let me turn things over to you, Marie Svensson, our CFO, to review our financial results. Marie.
Thank you, Søren. I need to mention perhaps that we should start with the next slide. I will begin with a review of the Q4 of 2021 financial results. Starting with net sales for the quarter amounted to SEK 5.2 million, up from 0 SEK prior year. This is a result of the revenue from our collaboration and license agreement with Orion Corporation and the research agreement with Biotheus. Operating loss for the quarter resulted in SEK 36.9 million, an 8.2 decrease from SEK 34.1 million in the prior year period. This is mainly due to increased personnel costs and external costs connected to the ongoing clinical trials for mitazalimab and ATOR-1017.
Cash flow for the quarter amounted to SEK 198.8 million, up from -SEK 33.2 million in prior year period. It's of course due to the rights issue in November, bringing in SEK 257 million before transaction costs. Company expenses for the Q4 increased slightly as we now are running two clinical programs, mitazalimab in phase II and ATOR-1017 in phase I. Alligator's cash at the end of the period amounted to SEK 278 million, up from SEK 103 million in the prior year. Now I will review the financials for the full year 2021. Net sales amounted to SEK 12.9 million and was up from SEK 4.4 million in the prior year.
This is mainly due to the earlier mentioned agreements with Orion Corporation and Biotheus. Operating loss for the year was SEK 141.6 million and an increase from SEK 144.3 million in the prior year. Personnel costs for the year amounted to approximately SEK 58 million. Cash flow for the full year 2021 amounted to SEK 174.7 million compared to SEK 9.4 million in the prior year due to the rights issue in Q4 2021. Next slide, please. In 2020, Alligator took a strategic decision to focus the company's resources on the projects that have the prospect of generating greatest value, our clinical programs.
The reduction in costs came into full effect in the Q3 2020, but has during 2021 slightly gone up as the clinical activities has increased, which is reflected in the diagram to the left, showing total expenses on a rolling 12-month basis. In order to support the continued development of our key assets, the company is continuously working on opportunities for partnerships, out licensing deals, and equity financing. In beginning of October, the company announced a fully guaranteed rights issue to be completed in November, amounting to SEK 257 million before transaction costs. With this right issue, the company's financial resources are sufficient for our planned activities the upcoming 12 months. Now over to you, Søren, again.
Thank you, Marie. If I could have slide 12. I close out the meeting with a couple of slides here. Lastly, in the beginning of February this year, we announced the appointment of Dr. Sumeet Ambarkhane as Alligator's new Chief Medical Officer. I, together with the board and the entire Alligator team, are excited to welcome a professional like Sumeet's caliber into the Alligator family. Sumeet's in-depth expertise in medical science, clinical development, and his experience from global regulatory submissions and importantly product registrations will significantly strengthen our efforts to further advance our novel immunology pipeline, and not the least, mitazalimab. If I could get slide 13, please. When I joined Alligator as CEO in June 2021, we had four main priorities. The priorities was to strengthen Alligator's clinical organization.
The second was to advance our lead asset, mitazalimab, into phase II clinical trials. The third one was to sign licensing agreements on our technologies, and lastly, to raise additional funds to support the development of our pipeline. In summary, I'm proud to say that during 2021, the entire team at Alligator made those priorities a reality, and the progress that was made in Q4 this year or last year, 2021, was a great way to close out our year of refocusing. We are taking this momentum with us into 2022, and our goal remains the same, to develop meaningful therapies for patients with hard to treat cancers that will better people's life, create value for our stakeholders and shareholders. We remain on track with our clinical trials, and I look forward to keeping you updated on Alligator's development on this exciting journey.
On behalf of myself, the board of directors, I would like to take this opportunity to extend our sincerest thanks to the Alligator staff for their achievements, their diligence, and their loyalty, and we also wish to thank our valued shareholders, new and old, for your continued support and belief in our company. With that, operator, please open the call for Q&A.
Thank you. Our first question comes from Richard Ramanius with Redeye. Please go ahead.
Hello. Thanks for your presentation. I have a few questions, but just a few of them to start with. The first question concerns mitazalimab. You were talking about starting a second phase II trial. Are you thinking about any new combinations such as PD-1, same dose?
Hi Richard. Good question. Yes, we have been discussing publicly the plans to initiate a second phase II trial with mitazalimab to increase, of course, the clinical utility of the molecule and also to balance the risk of the program by addressing another tumor type than pancreatic cancer. I'm not in a place to reveal exactly the indication now. A few have been in play. It's most likely an indication where a combination with a PD-1 will be relevant and part of the clinical plans.
Concerning ATOR-1017, you're drawing closer to a phase II trial. Do you intend to sponsor this trial yourself, or are you looking for a partner for phase II?
Yet another good question. Currently we are keeping our strategic options open. It's clear that a company like Alligator, we have to assess whatever options we have, the availability of potential partners, the right clinical design and budget, and of course, also the availability of cash in the financial market. Right now we are pursuing a dual strategy to explore opportunities ourselves, but also maintain dialogue with potential partners that can help us leverage the value of ATOR-1017.
Yeah, that makes sense. Now some financial questions.
Yeah.
Marie mentioned that Orion reimburses some costs. Will Orion reimburse all relevant costs, that is all research specific to them according to the deal?
Yes. I think I can answer that, yes. In addition to upfronts and fees and milestones, Orion cover all costs incurred at Alligator and then some.
Can you comment whether there are any upcoming milestones we should expect from all your agreements or all your present deals or agreements in 2022?
We can restate the overall milestones for the company in Q1. Before the end of Q1, we expect to provide the full update and readout on the safety part of OPTIMIZE-1. In Q4, we expect to announce initial efficacy interim readout for OPTIMIZE-1. Later in Q1 here, we expect to read out data from the ATOR-1017 phase I clinical trial. With respect to our collaborations, we don't foresee any specific fee-bearing milestones on the current collaborations. Those are currently scheduled in 2023.
Thanks. I have a very short question. It's a financial question. You have had remarkably stable costs in 2020, 2021, more or less the same. How should we look at the quarterly costs going forward from the next quarters of 2022?
Marie, do you want to take this one?
Yeah. You know, I would say that that it would be quite stable, because depending on what what we will, you know, do with ATOR-1017, but that's, you know, panning out, and finalize the phase I. On the other hand, we are preparing for starting the the next phase II trial with mitazalimab. That will be, you know, moving up instead. I think it will be quite stable.
Okay, thanks. Those were my main questions. Thanks for answering.
Thank you, Richard Ramanius.
As a reminder, if you do wish to ask a question, please press zero one on your telephone keypad. Our next question comes from Patrik Ling with DNB Markets. Please go ahead.
Thank you. Hi, guys. Also actually a financial question. I mean, Marie, if you say that your costs in 2022 will be relatively stable compared to 2021, and we might see some uptick if the clinical trial programs are expanded a little bit. Could you elaborate a little bit more on what you said regarding the financial situation? Specifically actually talk a little bit more about the actual runway. I think you said that you had cash enough, so it will last at least 12 months. I suppose given what you said about costs, that the runway is clearly longer than 12 months.
Yeah. It's longer than 12 months with the current plan. As we mentioned before, it depends on what kind of programs we would like to pursue, of course. This, you know, to run two clinical trials in parallel, then we will keep the same cost structure. If we would like to increase, then of course the structure would, you know, be, you know, increased cost. You're quite right there. It's more than 12 months.
Okay, great. My second question really, if you are considering moving into, as you said, sir, in another indication and probably in connection with PD-1 inhibitor, will it be still in an indication that you have tested the drug in before, i.e., either in your trials, your first trial or in the Janssen trial?
That's a good question. You can say that the Janssen trial, which is probably the most relevant as this was, as the other trial was, intratumoral administration. You say that first Janssen trial, which is the most relevant one, was an all-comer basket trial. There was a lot of different indications in there. I can confirm that the key or the top indication was included in that trial. We also have the preclinical data to support that indication selection on file in the company.
Okay. Great, because that's really what I wanted to hear, that you do have some patient data for that potential indication. Then lastly, I mean, the earlier trials were to some extent a little bit different dosing. When you look at the data for all patients that are having that indication that you're considering, the dose that they received is that in line with what you plan to give them today?
I think now we are probably getting close to the limit of what we can discuss because this data has not been publicly disclosed. Let me give you a broad statement that we, of course, when we design our trial, consider both available clinical and pre-clinical data on our own molecule and previous trials, as well as what our peers have made publicly available.
Okay, great. Thank you. That's all for me.
Our next question comes from Joseph Hedden with Rx Securities. Go ahead.
Good afternoon. Thanks for taking my question. I'm sorry if these have already been asked because my line dropped for a bit. Just wanted to ask on the phase I trial in combination with the dendritic cell vaccine. Is there any data for that vaccine, the monotherapy available in I think so far?
Joseph, there was some background noise, but let me just see if I understood your question correctly. You are talking about the investigator-initiated led phase I trial where we combined the mitazalimab with the dendritic cell vaccine in pancreatic cancer. You asked whether there were single-agent data on that vaccine available, correct?
Yeah. Yeah, that's right. Yeah.
Yeah. There is that vaccine as I recall it correctly, and the name is in the press release from, I think, October. Yes, that vaccine is in phase III clinical development as a precursor. There must be available single-agent data on that vaccine.
Okay. You say that vaccine was in phase III.
That's how I recall it, yes.
phase III.
Yeah.
I don't know what company is leading that trial.
Yeah, I can't. Why don't you drop Julie a line after the call, and we can get you that material.
Sure. Thank you very much.
Yeah. We are here to please.
At this time, we have no further questions. I will now hand back to Julie for a final remark.
Thank you from all of us at Alligator Bioscience for listening to today's call. This concludes today's call. Bye-bye.