Good. All right. I am Stephen Willey, one of the Senior Biotech Analysts here at Stifel, and glad to have with us as part of the next session, the CEO of Candel Therapeutics, Paul Peter Tak. We are just going to have kind of a casual discussion here. If anyone has a question, feel free to raise your hand. Paul Peter, thanks for your participation. Not sure if you want to start off with any opening statements before we jump into Q&A.
Good morning, everybody. Well, first, thanks for having me. We are in a very interesting phase of the company. I just came back from SITC, the immuno-oncology meeting, where we had three abstracts that we presented. One of them was a late-breaking abstract based on the PrTK05 study. We may come back to that. We had new data also in non-small cell lung cancer, where we used a proteomics approach. It was actually awarded the top 150 abstract award. Then we had another abstract about linoserpaturev, our second investigational medicine, which is also very interesting, that we tested probably the most difficult to treat form of cancer, recurrent glioblastoma, where we could show new immunological biomarker data. Then we are starting to see a subset of patients that live much longer than you would expect, even in recurrent glioblastoma. The prognosis is extremely unfavorable. A lot going on.
We are very busy also. It is a very strong focus on execution, right? That is in a nutshell some of the recent ideas. Yeah.
Let us jump into aglatimagene for localized prostate cancer. Maybe we can just start off with the PrTK05 data.
Yeah.
You just presented at SITC. I know the mechanism of this drug is pretty unique. I know that trial was intended to do some immune profiling, some biodistribution, some shedding. What can you say about the data that emerged out of that study, specifically on the immune profiling side, and how that kind of strengthens your confidence that this drug is acting in kind of like that multimodal mechanistic way that you believe it to be?
Yeah. The PrTK05 is an experimental medicine phase II-A clinical trial that was requested by the FDA. The question was really to repeat the old work on biodistribution and shedding. In other words, you test in different body compartments over time whether you can still detect the viral gene construct. We had shown in the past that it's all gone within a few months, which you would expect because it's replication defective adenovirus, it cannot replicate. Second, the cells that we infect, we kill actually by giving valacyclovir, right? The FDA requested, and rightly so I think, to repeat that experiment with more state-of-the-art technology, and it's one figure on the poster that we presented last week at SITC, where we basically reproduced these findings. Then I thought, well, we're going to inject aglatimagene into the prostate of patients with localized intermediate-risk prostate cancer.
Let's use this actually to take some extra samples to do sophisticated immunological biomarker research, because the biosamples were not available from the phase III clinical trial that delivered on the clinical endpoints supported by secondary and exploratory endpoints. But we wanted to measure the systemic immune activation after localized delivery of prostate cancer, which is important for multiple reasons. Let's first focus on the findings.
The key findings included a very clear increase in the number of circulating CD8-positive T cells, including CD8-positive, granzyme B-positive, that means they are cytotoxic, Ki67-positive, that means they are proliferating T cells in the blood. Also a clear increase in the number of effector memory cells and central memory cells, which may explain the durable responses that we've seen after aglatimagene injection. So, it supports the notion that aglatimagene is a systemic immunotherapy that is delivered locally. We've shown exactly the same already in the past in other solid tumors like glioblastoma. So, we used to have a program for aglatimagene in glioblastoma as well as part of first-line treatment.
We discontinued that for portfolio prioritization reasons, but actually we had very interesting data that we published in Neuro-Oncology that we could show that after aglatimagene delivered to the brain, we see a broadening of the T cell receptor repertoire associated with improved survival. We also had data at SITC a few days ago that we showed the same in non-small cell lung cancer, where we did proteomics, and where we also have shown a broadening of this T cell receptor repertoire, which is explained by the fact that we basically educated T cells to recognize a whole variety of cancer antigens and cancer neoantigens that are specific for the patient's own tumor. This explains in lung cancer that we have seen very clear evidence of an abscopal effect.
That means improvement not only at the site of the injected tumor, but also an improvement in the uninjected distant metastases. That's clinical evidence of systemic anti-tumor immunity, and we've shown the same, and that paper will come out shortly in the literature as well, in borderline resectable pancreatic cancer. It's really an off-the-shelf product that leads to an individualized systemic anti-tumor immune response. Why is that important for prostate cancer? If you think about our target indication, which is newly diagnosed localized prostate cancer, then it's not just that you kill the tumor cells with the initial hit of the toxic metabolite that's formed if you give patients valacyclovir after aglatimagene. It suggests that we are inducing a new state of immune surveillance.
If patients, for example, have micrometastases, you could imagine that these T cells that are circulating throughout the body will be able to find these micrometastases and kill them. But also, it opens up the opportunity to expand into later stages of prostate cancer in the future at the right time, let's say after approval. Think of oligometastatic prostate cancer. There's a lot of interest in that field, and potentially after that, in really advanced disease. You basically cover the whole field per disease indication and don't leave any patient behind.
Okay. Maybe we can talk about the registrational phase III study in localized prostate cancer. I know we've seen a few changes with respect to kind of how this disease is treated since you initiated this study, I think a long time ago, 15 years ago. Things like how risk subgroups are defined, how radiation's delivered, et cetera. How do you think the phase III data you've generated aligns with current clinical practice, just in terms of relevancy, and how comfortable are you that the data that you've generated to date kind of fits into that current clinical landscape?
Yeah. It's a great question. The patients in our clinical trial received EBRT, external beam radiotherapy, in the context of radical treatment or definitive treatment. The goal is to eradicate the tumor, and we've shown by focusing on disease-free survival that we achieved that goal. These patients got EBRT, and initially they received conventional EBRT, but then at some point, there was a new type of radiotherapy, which is hypofractionated EBRT. In 2019, we submitted an amendment to the trial to make it possible for patients to receive a moderate hypofractionated EBRT. First, this hypofractionated EBRT does not lead to better clinical outcomes, but basically, you give the same overall dose of radiotherapy in fewer sessions, which is more patient-friendly. Therefore, we amended the protocol. The FDA agreed, confirmed in writing that the SPA was still intact.
This is the first potential change in standard of care over time. We've shown, if you look at our corporate slide deck, that if you do an exploratory subset analysis and you look at the hazard ratio and compare the conventional EBRT group compared to the moderate hypofractionated EBRT group, then you see that the hazard ratios are smaller than one.
This study was not designed from a statistical point of view, statistical power point of view, to look for statistical significance. If anything, the hazard ratio looked even smaller after hypofractionated EBRT. I think that's probably statistical noise, or it's real because you induce maybe more DNA damage in a short period of time. The toxic metabolite that's formed under the influence of aglatimagene if you give valacyclovir is a nucleotide analog that will be incorporated into cells that exhibit DNA damage.
My short answer here would be that we've shown the beneficial effect of aglatimagene versus placebo, independent of the specific type of EBRT. The second important point to make is the use of ADT. In intermediate-risk prostate cancer, patients could get in our trial short-term ADT, which is defined as four to six months of ADT. We left it to the treating physician. I should mention that most of the patients in our trial were enrolled after 2017, 2018. Then for the first time, professional investors came on board, and more centers could be opened. You see real acceleration in enrollment. Actually, most of the patients were treated relatively recently in our clinical trial and got standard of care, short-term ADT. I'm focusing now on intermediate-risk prostate cancer, which is 85% of the patients.
But then over time, a new classification was introduced that did not exist at the time of protocol development, namely the distinction between intermediate-risk favorable disease, where short-term ADT was and is not indicated, and intermediate-risk unfavorable disease, where since the initial introduction of this nomenclature, the recommendation was to give them short-term ADT.
So again, we left it open to the treating physician, and we had about 50% of the patients in our trial who received short-term ADT, and we could show the benefit of aglatimagene versus placebo, independent of the use of short-term ADT. Again, if you look in an exploratory way at the different hazard ratios, that all tend to be smaller than one. But now there's a new guideline that came out four weeks ago, NCCN guidelines, which is completely consistent with what we have done in our clinical trial. Because the new change in the guidelines is that now for intermediate-risk unfavorable disease, the recommendation is to leave it to the shared decision-making between patient and physician whether the patient will get short-term ADT. So it's very much in line with how we designed the protocol, so we think this is completely relevant.
And then finally, we have done multiple sensitivity analyses that show consistently, however you look at the data, based on which version of the NCCN guidelines, we see the same differences between aglatimagene versus placebo.
Okay. So, you mentioned the SPA that you have in place with FDA. I know that was kind of predicated on the utilization of disease-free survival as a primary endpoint. What does your KOL feedback and some of the market research you've conducted suggest about the clinical meaningfulness of that endpoint specifically? I know you've presented some secondary endpoint data. We'll talk about that in a minute. But just on the topic of disease-free survival, how did docs think about that as kind of a surrogate of improvement?
Yeah. It's important to keep in mind, A, who are the treating physicians of these patients, and B, what do patients and physicians want to achieve in a localized prostate cancer setting where patients receive radical treatment? The treating physicians are urologists, and in our case, also the radiation oncologist, because patients have the choice between radical prostatectomy surgery or radiotherapy. The outcomes in terms of risk of recurrence are more or less comparable. So it's based on other considerations that patients may choose radiotherapy over radical prostatectomy. We focus on the patients who are already selected and self-selected to undergo radiotherapy, EBRT, and the goal is to eradicate the tumor. That translates in regulatory terms into an endpoint of disease-free survival, as we've seen in other indications like breast cancer, where medicines have been approved based on disease-free survival.
However, it has not been used before in prostate cancer, and that's why the SPA is so important. Why? Because there's no medicine that has delivered actually on the promise of really preventing recurrence in a localized prostate cancer setting. The urologists and the radiation oncologists know that these patients want to accept the side effects and long-term complications of radiotherapy. Same is true for surgery. Why? Because they want to get rid of their cancer. They want to live free from cancer. They want to avoid the need for future toxic therapies like salvage ADT, long-term ADT, right, which has a very negative impact on quality of life in at least two-thirds of the patients. They want to avoid local progression of the disease and metastatic disease, which is associated with signs and symptoms.
Urologists and radiation oncologists understand quite intuitively that more patients want to achieve this goal of living free from cancer, living free from cancer-related anxiety, and the symptoms due to local and metastatic progression of the disease, and the need for salvage anti-cancer therapies. And that's what we've achieved. Early on, we did already extensive market research, both in the U.S. and in Europe, with our partner, Global Life Sciences, that has shown both in radiation therapy and in urology, both in academia and the community center, that there was huge support for this approach. 100% of the respondents indicated that they would implement this in their clinical practice. And since then, we've done deeper research, especially with the advent of our Chief Commercial Officer, Mark Sims, who is here in the room, who came from a leading role at AstraZeneca. We started to work with EVERSANA.
We've organized many SABs. We work very closely with the Prostate Cancer Foundation. So there's very strong support from the community. In terms of medical oncologists, these medical specialists typically do not treat early localized prostate cancer, right? They see the medical oncologist when they have advanced disease. So, you always need to educate them and say, "Well, what is it actually that we try to achieve," right? We are not trying to achieve an advanced disease that patients live longer with cancer. We're trying to actually help them to live without cancer. And the upside ultimately after an additional 10 years is that if you don't have cancer anymore or any evidence of recurrence, you will not die because of prostate cancer. So, that's what we hear back during our SABs.
DFS was the primary. A lot of the secondary endpoint data you presented at AUA back in May, I know I was pretty impressed with the delay in time to metastasis. I know in a lot of the KOL discussions we have had, they had really kind of prioritized that endpoint from kind of a clinical meaningfulness perspective. I guess in that time to metastasis data though, right, there also appeared to be a little bit of a bifurcation between outcomes in intermediate and high-risk patients. How do you think about that secondary endpoint data informing potential labeling when the primary endpoint of DFS would suggest there is not a bifurcation between the risk subgroups?
Yeah. Interesting question. First, we have achieved our primary endpoint in December 2024, which was disease-free survival, supported by secondary endpoints like patients achieving a PSA nadir of less than 0.2 ng/mL . Other endpoints, exploratory endpoints, that is key actually, was a two-year biopsy that is not part of standard of care, but it was done per protocol. Why is it not part of standard of care? Because it is not very pleasant to undergo an invasive prostate procedure, right? But it is the gold standard and the most sensitive way to detect cancer. The physicians that we spoke to really like this because in the most objective and sensitive way, this is the gold standard to demonstrate tumor cells. We have shown elimination of tumor cells in more patients who had received aglatimagene versus placebo.
There is data in the literature, including a meta-analysis based on 22 clinical trials that shows the association between seeing tumor cells in a two-year biopsy after radiotherapy with curative intent for localized prostate cancer, and after extended follow-up, subsequent biochemical failure, and subsequent development of metastases, and even after longer follow-up, subsequent prostate cancer-specific mortality. In December 2024, when we had seen the data that we had more than 80%, I think it was 80.6% of the patients achieving a negative biopsy in the aglatimagene group, statistically more than in the control group, we predicted that if we would continue to follow these patients, we would start to see a separation for biochemical failure and time to metastases and the time to salvage anti-cancer therapy. This was not part of the secondary endpoint.
This is an exploratory endpoint that was not requested by the FDA, but this is exactly what we are starting to see. This was accepted for a plenary oral session at the American Urological Association meeting, AUA meeting, and this resonates with physicians who are maybe not used to research tools like prostate biopsies at two years, and who will just test the PSA levels in the blood of their patients. They see that, "Oh, this is something we recognize in the clinic." To your point, is there a difference between intermediate risk versus high risk? I think we need to be careful, because the numbers of events get really small in the high-risk group, right? Again, 85% of our patients in the trial had intermediate-risk prostate cancer. I think we do show the analysis in our slide deck that is online on our website for the overall population.
Then we also show the analysis, because it's still about 650 patients, for the intermediate-risk group. But if you look at the high-risk group, the number of events is really small because it's a small number of patients. I think it's very difficult to draw conclusions. There's no reason to believe that biology would be different from high-risk versus intermediate-risk prostate cancer. It's also not what we've seen for the primary and secondary endpoints. I should also highlight that our high-risk population is a special high-risk population because they could not have more than a single high-risk factor. So it's relatively low-risk, high-risk prostate cancer, if you can still follow me. We believe it will be a continuum. The final point is, the high-risk prostate cancer more often used ADT, right?
Because that's recommended due to the guidelines, which may mask actually the efficacy of other treatments like aglatimagene.
Right? We've seen the same in other fields like autoimmunity. We know that there were big phase III trials that could not demonstrate the efficacy of, let's say, rituximab in systemic lupus because all the patients got 60 mg of methylprednisolone, right? So, you mask the effect. Of course, you want to get rid of prednisolone in that setting as you want to get rid of ADT in the prostate cancer setting.
Okay. So you talked about the desire that exists from a physician perspective to implement this into clinical practice. Can you maybe just speak to the logistical part of the equation? Obviously, this is kind of three separate injections. It's spaced over the course of a couple of months. It's going to be administered in community urology practices. It's going to be administered by radiologists. What does your outreach tell you just about the logistics of incorporating this in the clinical practice?
Yeah. It's always very good to think through what this means in terms of work streams and in clinical practice. Here again, I want to highlight that the treating physicians are urologists and radiation oncologists, and they work already together because in this setting, the urologists have actually referred the patient to a radiation oncologist to get radiotherapy. This is quite attractive for these treating physicians because they are doing procedures anyway, right? As I mentioned, I mean, urologists do very complicated procedures like robotic radical prostatectomy. So, the prostate biopsy is a very simple procedure in their hands, and this is much simpler and less invasive than the prostate biopsy. So, this is for them extremely easy. The same is true for radiation oncologists.
Who also do procedures in the prostate, like the placement of fiducials or spacers. So, they're used to doing this, so the collaboration between urologists and radiation oncologists exists already in multidisciplinary teams, both in community centers and in academia, and they're also used to doing these procedures. They are very much aware of the fact that patients undergo procedures with quite a lot of downsides in terms of side effects. Think of urinary incontinence, think of erectile dysfunction, loss of quality of life. They do that because they want to live without cancer. So for radiation oncologists, it will be very attractive that they see improved outcomes of their patients. It's attractive for urologists because they will still play a role. We believe that after approval, hoping that we get to that point, that the urologist in most cases will actually do the procedure.
There will be a reimbursable procedure. There will be a commercial incentive to prescribe our medicine. It's very much aligned with normal clinical practice.
Okay. The reimbursable procedure, does that manifest in the form of a separate J- code that is not coupled to the product itself?
Yeah, we believe there will be the reimbursement for both the procedure and for the medicine.
Okay. Then maybe you could talk a little bit about the work that you've done on the reimbursement side.
Yeah.
Engaging payers, and maybe how that has informed your current thoughts around what a price point might look like.
Yeah, certainly. We've done work from the early days since I joined this company six years ago, a little bit more, with Global Life Sciences that did in itself market research and payer research, both in the U.S. and in Europe, where there was real interest in our program. But more recently, we've done deeper research, especially with the advent of our Chief Commercial Officer, as I mentioned, and our collaboration with EVERSANA, that has a global footprint. They did much deeper payer research. To our surprise, although we had initially modeled that this would be a blockbuster indication, it's a very big indication, actually larger than non-small cell lung cancer, that initially Global Life Sciences had used very conservative assumptions for price.
If you look at the price range for GU tumors, especially including patients treated during earlier stages of the disease, with curative intent, then probably the price is much higher than we initially modeled. The median price range is $285,000 per year. In our case, that would be for three administrations.
I do not say that we get this price. We are doing the additional payer research. You always need to be careful. You need to negotiate this. But we believe that this will sit in the range that we will update very shortly. But again, the median there is $285,000—
Okay.
—for three administrations in our case. What payers really like when we talk to them in the U.S. is that, A, we have achieved the primary endpoint, supported by relevant secondary and exploratory endpoints, as we discussed. Also, the work that I mentioned, the extended follow-up data at AUA, are maybe more for the payers actually than for the regulators. The regulators did not request these data, but this shows the relevance. The second point is, we have not shown any increase in serious adverse events after aglatimagene versus placebo. So, it is always about benefit-risk that payers focus on. And the third point that they really liked is that it is not a recurring cost to the healthcare system, right? So, you give a bundle of treatment, albeit consisting of three courses, and off they go, and that is it.
And probably also trying to avoid future cost to the healthcare system.
Like the need for long-term ADT, which brings a significant cost and toxicity and loss of quality of life. We started to see that in the AUA data.
Okay. Maybe we can spend the last few minutes on lung cancer. You also have a phase III registrational effort—
Yeah.
—that you just started a few months ago. This is in second line non-small cell lung cancer. You are trying to defeat that which has not been defeated by the drug development industry to date, which is docetaxel as a second line comparator. As you think about the lung data that you've seen with aglatimagene in phase II, what gives you confidence that you're going to be able to take down docetaxel where so many others have failed?
Yeah. Everything always fails until somebody figures out how to develop a medicine that works, right? It should all be based on the data. So, our data were recently published in the Journal for ImmunoTherapy of Cancer, clinical data supported by deep immunological biomarker data. We focus on the patient cohort with very unfavorable baseline prognostic factors. The data are in the paper, and also you can find it on our corporate slide deck, right? Many, 90% of these patients had failed immune checkpoint inhibitors, most of them also chemotherapy, sometimes multiple lines of chemotherapy. 90% had stage 4 disease or metastatic disease, in most cases progressing despite optimal standard of care. Many of them were current or past smokers. More than 50% had very low or undetectable PD-L1 expression. So, it's a really bad group, right?
Typically, these patients get docetaxel, second line chemotherapy, as you mentioned, which is consistently associated with a median overall survival of less than one year. So, in the group that received two administrations of aglatimagene, and the second administration is critical because this works like a vaccine. We turn the tumor into a vaccine, basically. We teach the patient's own immune cells how to recognize these cancer antigens. So, here we could show that in these patients who had an inadequate response to optimal standard of care, it's a treatment that's well tolerated, generally speaking, and that only comprises two administrations delivered during bronchoscopy. So again, it's aligned with normal clinical practice, where pulmonary physicians use bronchoscopes every day as their standard tool in clinical practice. So, these data are encouraging, all supported by deep immunological biomarker data. So, that gives us quite a lot of confidence.
Now we want to replicate this in phase III. There are always learnings from a clinical trial. So, we have learned that in non-squamous, it looks even better than in squamous. It looks even better if you inject a lesion in the thorax rather than, let's say, in the liver. So, we've made a change there. You need to make sure that you are not misled by a CT scan at six weeks, because there may be pseudoprogression. We replace tumor cells by immune cells. So, these lessons have all been implemented in the protocol for the phase III. So, we hope to replicate and maybe even improve on the data that we published based on the phase II study.
Okay. I know we're kind of out of time here, but anything we didn't cover that you would like to quickly highlight before we wrap things up?
Very briefly, I think this is a pan-solid tumor approach with a lot of opportunity. It's a real platform. I also want to highlight that linoserpaturev, our second investigational medicine, has very exciting data. We speak a lot about aglatimagene because it's in a late stage of development, but there again, we make very good progress. There is also an opportunity to expand into other indications outside the brain.
Okay. There's a 60% chance I skipped that last one because I'm still struggling trying to figure out how to pronounce it.
CAN-3110, linoserpaturev. Thank you very much, Steve.
All right. Thank you, Paul Peter.
Thank you. Thank you very much.