Hello, and welcome to Alligator Bioscience's interim report call for the first quarter of 2026. With me today are our CEO, Søren Bregenholt, and our CFO, Johan Giléus. My name is Greta Höög, and I'm the IR and Communications Manager at Alligator, and I'm introducing this call. Today, Søren and Johan will walk you through the latest events from the quarter, after which they will be happy to answer any questions that you may have. You can either submit these via the Q&A functions of this chat, or you can email them to ir@alligatorbioscience.com. As you know, Alligator is a publicly listed company, and I would like to note that today's presentation may include forward-looking statements. Please refer to the disclaimer on this slide, which applies to the full presentation. With that, over to you, Søren.
Thank you, Greta. Once again, welcome to this quarterly call from Alligator Bioscience. It's a pleasure seeing so many participants. Let's go to the next slide. What we will focus on today is some of the key updates. If we look at our lead asset, mitazalimab, we presented and discussed the final data from the phase II study at ASCO GI in San Francisco in January, which was immediately followed by JP Morgan, where we had a number of partnering discussions. Recently at the annual AACR meeting in 2026, we presented data from one of the IIT studies that we've been doing together with a Dutch group, data further underpinning and strengthening the mechanism of action of mitazalimab.
As we're also going to discuss later today, we announced that we have signed a so-called letter of intent with a French organization called Unicancer to explore the continued development of mitazalimab in an investigator-sponsored phase III study. On the business side of Alligator, the TO 14 warrants matured, and there was an exercise rate or subscription rate of 38%, which led to a gross proceed of SEK 90 million. The nomination committee submitted its proposal ahead of tomorrow's AGM in nominating two new board members, adding significant skill and breadth to the Alligator board.
We also got a new patent granted by the U.S. PTO on our proprietary bispecific antibody technology, which we call RUBY. A technology that we have been using in a number of internal programs and also earlier signed a evaluation and option agreement with a company in the antiviral space. Finally, on our partner program, HLX22, the first patient was dosed in a phase II/III trial in recurrent HER2 positive breast cancer, again adding to the breadth and the commitment of Henlius advancement of HLX22. Now, let's have the next slide and focus on some of the recent development in the world around us.
I think anybody that follows me, follows mitazalimab, Alligator and pancreatic cancer is aware that Revolution Medicines announced data or at least announced a couple of numbers in a press release on their KRAS inhibitor, daraxonrasib, in second-line metastatic pancreatic cancer. These data showed significant improvement for these patients, and it's clear that this molecule will be used in second-line therapy in pancreatic cancer very, very soon. Together with other molecules in this drug class, the KRAS inhibitors will most likely be introduced in first-line therapy within the next two, three, four years.
A lot of things happening in the indication and first and foremost, this is really, really good news for pancreatic cancer patients who have progressed on chemotherapy and now have an option in second-line therapy. What it also does for companies like Alligator and others developing drugs in the, in the, in the indication is of course, that it opens up the indication. It shows that drugs can be developed after many decades of very few success stories.
It will most likely drive the maturation of both the second- and first-line therapy to today, from today being a chemo-only or chemo-almost-only landscape to a landscape that will initially be dominated by doublets, and eventually also by more combinations such as triplet therapies as we see in many other indications, where the treatment landscape has matured. Right now, all we know on these molecules is the top line phase III data. Some data was recently released at AACR, both in second and first line. We will have to see at ASCO in a month's time on how the data look in detail.
Before we know that, it's difficult to say how will the second and first line landscape develop over the years to come. It will be probably characterized by several different KRAS inhibitors. There's a couple of other, both pan-KRAS and mutation-specific KRAS inhibitors in development. We believe that one or more of these will make it to the first line. We also believe that mitazalimab has a role to play in this maturing treatment landscape, something that we will discuss in just a second. First of all, good news for the patients. Really something that can contribute to a better prognosis for those patients that have progressed on chemotherapy.
If we take the next slide, I just wanted to remind you that mitazalimab in its way of working is complementary both to chemotherapy and also to KRAS inhibitors. You've already seen the data on the left-hand side here of the graph with a lot of very deep responses and across the two doses tested in phase II, actually five complete responders, which as far as we have seen data, is not something you see neither with chemo or with KRAS inhibitors. If you tap a couple of times, Greta, on Yeah, one more. Basically, yeah, you can just click forward and so we'll have all of them there.
Basically, what is characteristic by mitazalimab and its ability to activate the immune system is that in addition to these treatment responses and patient progressing after six, nine months, we have a significant amount of patients that are seeing sustained clinical responses, sustained survival benefit with mitazalimab. As you recall, the survival rate at 30 months was one in five patients, something you don't see with chemotherapy alone. Why is this? On the next slide, and just to repeat what we have discussed at these meetings before. Mita has several ways of activating the immune system.
Primarily and the hallmark of what we see linked between the mechanism of action and the long-term survival benefit is the ability of mitazalimab to activate tumors, tumor-infiltrating T-cells, and thereby mounting the body's own defense against the pancreatic tumor in this case. How will this play out when you combine KRAS and mitazalimab? Do we have any evidence? To get a little bit of that, we can look to the literature if we take the next piece of evidence here, which is two graphs, not from Alligator, but from other researchers, from a set of publications that came out in Cancer Discovery last year.
What these data show if we focus on the left-hand side here, is that when you take a KRAS inhibitor that is in the orange, you get a certain number of responses in this model. You can see one mouse sort of have a complete reduction in its tumor. At this dose, there is a few other small responses. If you, in the same experiment, add a CD40 molecule, a surrogate of mitazalimab, you can immediately see that the majority of mice, all mice minus one, actually have a complete remission of their tumor. Clearly showing a combined benefit of a KRAS inhibitor and a CD40 monoclonal antibody like mitazalimab.
That is further corroborated by the data on the right-hand side of the figure here, where a group of researchers have not only combined the same KRAS inhibitor, but also with a so-called CDK4/6 inhibitor, so another targeted therapy, and then with the same CD40 monoclonal antibody. What we immediately see on the tumor volume is that when you add the CD40 to either of these combinations you completely eliminate the tumor. You can see the slim blue lines here, close to zero. When you look at survival on the other part of the graph here, you can see that the small molecule or the targeted inhibitors only have a limited effect on survival.
When you add the CD40 molecule to this combination, i.e. allow the immune system to attack the tumor, then you certainly have a significantly protracted survival benefit in these models. One of the hallmarks of combining drugs in the clinic is, of course, that you need to not only look at the combined effect of the drugs, but especially in patients with stage 4 metastatic cancer, side effects is also a significant part of your treatment selection. What we know from the phase II study is that the validated mechanism of action is linked to the long-term survival benefit. I just showed you that this is complementary to these targeted therapies.
We also know that the safety profile of mitazalimab is compatible with the most harsh form of chemo and had allowed us to sustain dosing in these patients for up to three years. We really believe that mitazalimab will have a role to play on its own in first-line therapy together with chemo therapy. We definitely also believe that mitazalimab will be a future combination agent with KRAS inhibitors, whether it's the currently developed KRAS inhibitors or some of the ones that are currently entering phase III, that time has to tell. What will this mean for patients? I'm sure you can recognize this from one of my first slides.
If we look at how chemo has, or how the treatment landscape in first line has developed, over the last couple of decades, the primary focus have been on or been developing, chemotherapy, gemcitabine, the plus nab-paclitaxel adding a little benefit. FOLFIRINOX, as you know, adding some more benefit. Recently, Ipsen and Servier marketed ONIVYDE and NALIRIFOX, which did not really add much to the efficacy. Now we have in 2026, the start of what I would call the doublet era where we start combining drugs in first line, most likely with chemotherapy.
Hopefully that will lead in a number of years to a much more developed and mature treatment landscape where patients and physicians have choices between their therapeutic regime, their combination and the timing of this, something that doesn't exist today. Again, just to emphasize that we believe that mitazalimab is a sublime combination partner in this regime. A significant progress for the patients and a maturing of the treatment landscape. Of course, it adds complexity to the world that we live in. That is a complexity that we are navigating as we speak.
If we take the next slide, this is just to remind you, please don't go into the minor details here, but really just to take a status on where we are with mitazalimab. We have developed the drug. We've developed all the non-clinical aspects of the drug. We have, as you know, agreed on the clinical way forward with regulators. We will of course continue our dialogue with regulators also in light of the latest data and see if that changes anything positive in FDA's and EMA's paradigm.
We are evaluating the feasibility of the phase III study, both on a larger scale, or a macro scale and also on individual trial sites in the countries that we are targeting. We expect also to be able to submit the final regulatory documents sometimes during Q2. Basically what is ahead of us in sort of big chunks in terms of development is of course the phase III study, which, if everything holds true, we are carefully hoping to be able to start in the fourth quarter of this year.
Of course we also have some final manufacturing validation to do sometimes after trial initiation that is needed for the ability to file your new drug application. The next slide, Greta Höög, is really a reminder of the trial design that we have discussed at this forum a couple of times. Approximately 570-something patients. You know that we have signed a letter of intent with a French non-for-profit organization, Unicancer, to investigate the feasibility or explore the feasibility of a investigator-led study. I think it's very important for us here to emphasize that the study that is being explored is the study that has been agreed with FDA and EMA. It's a study in registrational quality.
It will be run at well over 100 sites across Europe and North America. It will of course provide a significant reduced cost structure while we are maintaining the submission quality that's of increasingly or absolutely important. As I said, site feasibility is ongoing. There is a very strong interest from trial sites in the territories that I just mentioned. You can say it's actually a little bit the different flow. Normally, your CRO reaches out to sites to gauge their interest. We now have a flow the other way with sites learning about the study and actually reaching out to Unicancer to become part of this.
Despite the data that we discussed from the KRAS inhibitors, we believe that there is still a significant interest from investigators in mitazalimab and interest in participating in this registrational study. With that, we close mitazalimab for now. I'm sure that there will be questions in the Q&A, and we'll pick it up there again. If I can have the next slide, just to reiterate our licensed molecule, HLX 22. As you know, this is a HER2 monoclonal antibody that is being developed by Shanghai Henlius in China. Alligator has a financial interest in the molecule.
We believe that that can in a conservative way lead to a net inflow of between $15 million and $40 million annually, approximately from 2030. I think it's fair to say that that potential value is not reflected in Alligator's market cap, but that's another story. There's a phase III study going in gastric cancer. The first data of the first patient was dosed in a phase II/III study in recurrent breast cancer.
Interestingly enough, we saw the first pre-clinical data on a new molecule in the family called HLX49, which is a bispecific ADC, incorporating as one epitope parts of HLX22, and is thus part of the agreement complex that we have with AbClon and Henlius. This data was presented earlier in April. You can see in the table here that there is a number of studies ongoing and planned. I think most interestingly, Henlius has also announced the intent to start a phase II, III study in neoadjuvant breast cancer, so pre-surgery. If we can have the next slide here. Yeah.
This is just a little bit on the data of the phase II data underlying the global phase III data. A very strong, a very strong hazard ratio of 0.2 in this study. Very, very convincing data that leads us to believe that the probability of success in the phase III study is relatively high. With this data, I will hand the floor to you, Johan.
Thank you, Søren. Can we have the next slide, please. Here is the snapshot of the Q1 results from Alligator, we have around SEK 17 million in operating cost, and that's mainly the general operating cost that we have within the organization, and we do have some limited initial costs for the planned phase III then. Yes, small amounts then. This is also what we have expected when we come to this level of running cost then. As we had in previous periods also, we have a number of non-cash and cash items within the financial items that stems back from the TO 14 and also the re-negotiated loan with Fenja and some interest cost deducted from that. Quite uneventful first quarter then.
Moving over to the next slide, please. Here you can see in the graph then how our, you know, cost has come down from an annualized level of SEK 300 million and down to SEK 100 million here, and we are still going down with the rolling effect and down to SEK 15 million-20 million per quarter. That's what we expect then for the general operating cost then. As always in this industry, the liquidity position is of our interest, and we have around SEK 33 million in our cash account and per the end of the quarter, and that provides some runway cost then for up to the mid third quarter.
Of course, that's not good enough. We are then looking into various options then to finance the running cost as well then, but also the phase III cost. We will come back on that once we have something to communicate then. That was a snapshot of the financial situation within Alligator. Back to you then, Søren.
Thank you, Johan. I'll turn off my camera. Yeah, just to summarize what we have discussed today before we go over to the questions. The phase II trial with mitazalimab in first line metastatic pancreatic cancer is completed. We believe the data is relatively, or not relatively, very encouraging and promising and that they warrant registrational development in first line. We are also very cognizant about that the treatment landscape is changing. We are of course in the process of talking to all of our global key opinion leaders, Americans, or U.S.-based, European-based and Asian-based to ensure that we understand all aspects of this.
We still believe that the mita needs to be developed, both as a chemo combination but also as a KRAS combination partner. We have agreed the regulatory path to approval in first line, as we already discussed we've signed the letter of intent with Unicancer to explore an investigator-sponsored phase III trial to significantly lower the cost of that trial. We already discussed the KRAS inhibitors and the fact that the preclinical data demonstrates synergies between this new class of drugs and mitazalimab.
We continue our partnering efforts as always, both with focus and diligence, and it's also clear that there's probably a new target of companies now that are interesting for Alligator, namely the companies developing second, third, or fourth KRAS inhibitor in line who may need something to differentiate that drug once it gets to the later stage of development. As we also discussed previously, a number of development options beyond pancreatic cancer is being explored, and we expect the randomized phase II trial in biliary tract cancer to start as well as others during 2026.
HLX22 represents a potential and significant longer term financial upside for Alligator Bioscience and its investors. We discussed the phase II data in pancreatic in gastric cancer and the ongoing phase III. More clinical trials, registrational trials will start, and then we saw the convincing preclinical data presented for the new kid on the block, HLX49, which is a derivative from HLX22. With these words, I will stop for now and turn to the questions. As always, we have the chat is open and you can put in your questions there. We already have a few ones that I'll read out and answer.
There is a lot about phase III development, let's take them one at a time. Philip from Redeye asked, "When do we expect to finalize the feasibility assessment?" That is ongoing. We are in parallel of course negotiating a contract and we expect that to be finalized within relatively short and we'll notify the market together with Unicancer when that is the case. There is a couple of questions about the financials around such a phase III set up from Josef Hiddensee. We're not in a position to talk about that.
We don't have the final budget and again, we're not going to communicate that before we have finalized arrangements with Unicancer. A couple of slides here or questions about how do we incorporate the understanding of KRAS, the impact on the treatment algorithm into phase III, potentially phase II design. As I said, we the industry only have a press release and a poster from AACR. The full phase III data and second-line therapy will be announced at ASCO in around a month, data will come as trials are reporting data.
For Alligator, the current hypothesis and based on the information we have is that mitazalimab needs to be developed and approved most likely on its own account, and that's what we're doing in the current phase III. We still believe that there will be a population of patients that are that will be treated with chemo and mitazalimab.
If we go a little bit deeper into the dialogue about KRAS inhibitors, we have a hypothesis that the G12D-specific KRAS inhibitors will probably be combined with chemo, and we believe that mitazalimab in that combination with a G12D-specific chemo and mitazalimab is clearly a population that is targeted by us and that would, of course, be facilitated by an approval of mitazalimab. In the KRAS non-G12D population, that's the remaining around 60%, we still don't know whether KRAS will be a first-line therapy or whether it will be reserved for second line.
Of course, you'll ask the question about why not put the KRAS pan in first line. I think there's a number of indications like renal cancer for instance, where some of the more efficacious and broadly specific drugs are kept in second line as a long stop if you may, once the patients have progressed on some of the more specific therapies. What I'm trying to say here is that the treatment landscape is changing, no doubt about it. Nobody can, based on the available information, really judge how it will be in detail. I don't believe in that one drug will take everything.
There will be room for drugs like mitazalimab on its own, and definitely also in future combination regimes. How do we get there? Our current hypothesis is to continue the phase III development with mita and FOLFIRINOX, and then together with KRAS developers, probably do some phase II studies in that combination. I can see here that there is already a question here whether there is a possibility for investigator-initiated studies in the future with KRAS, and this is Sebastian from Kempen, with KRAS and mitazalimab. Absolutely, yes, that is already being discussed. Sebastian also wonders whether the partnering discussions have changed regarding mitazalimab given these changes.
I would say that everybody of course stops and take a look. We look at this as two thing in two ways, and we also hear both views from investors and partners. Some believe that the KRAS inhibitors will dominate completely. I don't personally believe that. Others believe that the KRAS inhibitors will open up the indication and make a more mature treatment or facilitate a more mature treatment landscape with double and triple combinations going forward. Do we have any more questions? Yeah. We have a question from somebody called GT. I think it is good practice to fill in your name here.
Is Moelis & Company still engaged, is the question. We still have a contractual engagement with Moelis. Yeah. There is a number of questions about the continued development strategy of mitazalimab. And again, our current hypothesis is to develop mitazalimab together with FOLFIRINOX in a phase III study as outlined, and at the same time assess its efficacy in combination with KRAS inhibitors. How exactly that trial is or such trials are going to be designed, whether it's first line, whether it's second line, there you have to bear with me that we don't have enough detailed data to be able to assess that completely.
That is something that we, of course, are discussing with our key opinion leaders and other experts, and that is something that will mature over the coming months. I don't think we have, we have any more questions. Should we give it one more second? No, that seems to be the end of it. Once again, thank you for your attention. I hope this was useful. Have a lovely afternoon or day, depending on where you are in the world. Thank you.
Thank you.