Everyone, to this session of the Morgan Stanley Global Healthcare Conference, I'm Judah Fromer, one of the Biotech analysts here. Let me just read a quick disclosure before welcoming the Celldex team. For important disclosures, please see the Morgan Stanley Research Disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative. With that, thank you, Celldex team, for coming to see us today. Maybe we can start off for those maybe a little bit less familiar with the story, and provide a couple of minutes of background on the company, and your lead asset.
Sure, Judah. Thank you, and thank you for inviting us. We really appreciate this. Celldex Therapeutics has been around for a while now. We're in the area of immunoinflammatory. We develop antibodies and bispecifics to target those indications. Our lead asset is called Barzolvolimab (CDX-0159). It's an antibody that targets KIT (CD117). We are in five indications currently: two Phase III studies ongoing in CSU, which is a global study ongoing in 480 sites in over 40 countries, where we plan to treat 1,830 patients within these two studies. We think everything's going well there. Behind CSU, we have two indications in urticaria. One is called cold urticaria, the second is symptomatic dermographism, where we presented our 12-week data some time ago, and we met all the endpoints there, both primary and secondary.
Our next readout is 20-week data from the randomized placebo-controlled study, and that should happen sometime in the fourth quarter of this year. The 44-week data, which will include our OLE study, will be presented sometime in early 2026. In the meantime, we're preparing to begin Phase III studies in cold urticaria and symptomatic dermographism. We're hoping to be up by either the end of this year or the beginning of 2026. Beyond those studies, we have a study going on in PN, a Phase II study, a randomized placebo-controlled global study. We hope to complete that sometime in 2026 with data in 2026 before we move on to Phase IIIs. We also have an atopic dermatitis study going on, also in Phase II, also global, no, in the U.S., and placebo-controlled study. A lot of activity around Barzolvolimab, a lot of things going on.
As you can imagine, we're spending the vast majority of our time in these indications and look forward to presenting data as we go forward. We have our second program called CDX-622, which is a bispecific of TSLP by stem cell factor. Currently, it's in healthy volunteer studies. We would be able to get some data on that by the end of the year in the SAD study. The MAD study is ongoing. Sometime in 2026, we'll have the MAD data, and then we'll do a proof-of-mechanism study with that asset before we decide where we want to go. That is a snapshot of where our programs are. Behind that, we have other assets that Tibor Keler and his team are working on that we think will create a lot of value in the future. These are the two big assets right now.
Okay. That's a great overview. We've been interested in the term that we're seeing more and more, the term mast cell-mediated diseases. Your clinical studies are helping us figure out kind of exactly what role mast cells play in some of these indications. How would you frame the importance of mast cells in different indications and how that informed Barzolvolimab's clinical development?
Sure. Do you want Tibor to take it from the bottom?
Sure. Yeah. I mean, certainly, the role of mast cells is better understood in some indications than in others. Urticaria was an area where really there was very strong biology around the importance of mast cells. Part of that was through the success of the anti-IgE drugs in this space. We are gathering and have been generating evidence in other disease indications. Some of it is through patients that have comorbidities on our trials. That's how we initially saw the impact on prurigo nodularis in a patient with symptomatic dermographism that had their PN completely healed while on study, and led us to the Phase IB where we confirmed that signal, looking really good. We do believe that mast cells now are validated in terms of their ability to impact non-histaminergic itch, chronic itch that's not present only in PN but also in atopic dermatitis.
We follow the science and the literature. There are cases where the role of mast cells seems highly implicated. We believe we have the right drug to test in those cases, not that they may not all work out. That's part of the rationale for also developing a bispecific pipeline where mast cells are important but not the main driver, where we have the ability to complement mast cell depletion with other pathways.
Okay. That makes a lot of sense. You shared an interesting update earlier this year in the Phase II CSU study where you followed patients seven months after they stopped treatment with Barzolvolimab. We saw some patients with sustained complete responses. I guess, what were the key takeaways for you from that dataset and what you might have expected in the absence of treatment, in kind of precedent datasets?
Yeah. We were really excited about the results we got at our 76-week data readout. What we showed there was that, seven months off of therapy, 41% of patients still had a complete response, which is really unprecedented data. The CSU is characterized by spontaneous remission in some cases, and there's varying literature about how frequently that occurs. What we've been told by the experts was that in this kind of population we were looking at, you would expect it to be less than 10%. It was really remarkable. It was not just the complete response rate. We saw that those patients sustained their quality of life and all the other endpoints. Really unprecedented. Other agents don't do this. If you take Xolair, after treatment, patients come back to normal within weeks, really. It's really quite remarkable.
It's really caused a lot of interest among the medical experts in the field as to what is happening here.
Yeah. Also the safety profile, so on and so forth. We've been saying forever that you will have your KIT AEs, but we believe that they're completely reversible and don't have any clinical impact. Excuse me. Certainly, we saw that with the neutrophil drops. While on study, they resolved, and we saw the same thing with the hair color changes and the hypopigmentation as they are coming off drug. Those were resolving, but while maintaining a complete response for 41% of the patients. We thought that that was really extraordinary.
Got it. What would you typically expect, in terms of the mast cell lead population after drug is cleared? Were there any surprises or warnings?
We've seen other drugs, and, you know, some have dosed out to 24 weeks, and we've seen their disease come back by week 40. The fact that we were able to do a one year of treatment and see that sustained benefit, over seven plus months, it was very extraordinary. We were very, very happy to see that.
Great. Diane, you touched on Xolair, but I guess, you know, we've seen rapid onset of effect with Barzolvolimab, and now it seems like there's a good argument to be made for durability after a few months' cessation. I guess, how do those kinetics kind of more broadly compare to available treatment options?
I think other treatment options, you return to normal much more quickly than here. I mean, here we had this very long persistence of effect, and it looks like they're kind of slowly coming up, but it really seems to offer patients the chance of a long period off therapy where they're in a complete response.
Yeah. I mean, we've been told by KOLs and experts in the field that the dataset that we presented at 76 weeks now gives them the ability to ask questions about how you truly treat patients in the real world that they weren't able to ask before. Obviously, you talk to other people, and they'll have different questions. Certainly, that kind of thinking that's now coming around from these KOLs when they meet is extraordinary. I mean, they're thinking of the ability that we can get patients with complete control. We can get them and keep them there, without having to have them on drugs for an extended period of time, which is gratifying to see.
Is there anything you could share in terms of kind of KOL reaction by maybe subspecialty, right? There are allergists kind of on one end of the spectrum here. There are maybe high-volume derms on the other end of the spectrum. It seems like this dataset, especially the safety data you touched on in terms of the neutropenia resolving. I think there were some, like you said, some hair and skin color changes that were ongoing. Anything on the safety side that maybe has brought some of the derms more kind of on side?
I can just tell you some of the work we've done, and certainly Diane can talk about some of the other conversations she had. Without the context, like the hair color changes or the hypopigmentation, unless you show a picture, we believe people's minds just run, and they'll say, "Oh, no. I won't do this." Then when you show them the picture, more times than not, we got, "That's it. That's the hair color change." I'm like, "Yes, that is. That's a grade one hair color change. That is hypopigmentation." They're like, "Based on this, I don't see any issue with it." In the absence, it's the picture speaks a thousand words type of thing. On our end, when we do our fieldwork, that's what we're hearing, you know.
Yeah, I would agree. I think that the pictures have been very important. We do see these changes. It's a very well-understood mechanism of KIT targeting. It's mostly mild. It's reversible. The patients have said to us and the investigators that they're so happy that their urticaria is better that some of these things don't really trouble them at all. In looking at the allergists and the dermatologists, it's true that the allergists are very tuned into the severity of urticaria, so they haven't really been very concerned about it. Much of the dermatologists, when they hear about it, they're more concerned. We found that when they see the pictures, they say, "Oh, you know, that's really not a big deal.
Do you have a sense for, I guess, patient-type by severity that's treated by the various subspecialties of DAC and whether that impacts their bar for, you know, safety profile?
We know the allergists treat the, quote-unquote, "more serious patient." We'd love to know what that definition is, and that it's defined by anybody differently, right? It could be someone with angioedema, it could be someone with just poor quality of life, it could be somebody with a high UAS-7 score. Chances are, if you have a high UAS-7 score, you have a miserable quality of life. We think that, for the most part, the allergists don't blink. I mean, they take them on and do well. We're less certain about the type of patient the dermatologists see. Certainly, you know, that would require more fieldwork on our part. I hope, you know, hopefully, by the time this study is done, we'll even have dermatologists that are experienced with treating Barzolvolimab on the CSU study. We'll probably have a better answer for you this time next year.
Okay. That makes sense. You've been enrolling patients in the Phase III program for CSU. Can you talk a little bit about the design of these studies and the patient enrollment so far?
Yeah. The Phase III is a randomized, placebo-controlled study. We're looking at two different doses of Barzolvolimab versus placebo. We have a 24-week placebo-controlled period, followed by an active treatment period out to 52 weeks. The endpoint is at 12 weeks. The primary endpoint is the change from baseline in urticaria activity score 7. I think the patients on the trial are patients who are refractory to antihistamines. You do allow Xolair experience in refractory patients. In fact, we're looking at that group statistically. I think the really important thing about the study is we have tried to keep it as close as possible to the Phase II study that we conducted. The only real major change is that we have added a loading dose to our doses. That's based on data from the Phase II study.
We think we might get a little more efficacy, rapid onset of response with the loading dose.
How important is that rapidity of effect, I guess, based on patient?
We think it's very important. We already have a rapid effect. We think we can further improve it just because with the subcutaneous dosing, it takes a while. Also, it's flat dosing, so patients of different sizes, we think it might benefit more people to have a rapid response. From what we hear from patients, this is an absolutely miserable disease, and they would like to have relief as quickly as possible.
One of the surprising things that we heard as well from KOLs is that when they looked through the data, and we presented the data, they were like, "Wow, we didn't really understand that 93% of your patients had a clinically meaningful change on study." I mean, that, again, I know they start thinking real world, you know, what else can I do to get that even better? Something like a loading dose, which we think will give a faster response and maybe even a deeper response, that's something that we're crawling to see.
Okay. What can we expect in terms of updates in the Phase III trial, just timelines there?
When we're done with accrual, we'll update that we're done with accrual. When we have data, we'll have data. Those are the updates that we'll give.
Okay.
We have told people that it's accruing as expected. That's the wrap-up that we'll give.
Okay. Sounds good. You touched on the Phase II Sanders study that you should expect an update from. Can you tell us kind of what could be contained within that update, what your expectations are?
Yeah. The update we're going to have is the 20-week treatment data. It's placebo-controlled for 20 weeks, so it's the longest placebo-controlled period that we've presented. We expect to see impressive efficacy as we saw with the 12-week data.
Got it. How do you think about market opportunity for Sindu versus CSU? It seems like there's a lot of overlap when we talk to docs in terms of how they see patients. How are you able to kind of bifurcate the market, or do you need to?
I don't think we need to bifurcate it, but if you just do the pure map, the way we understand it, it's anywhere between 25% and a third of the CSU patients. A percentage of them have both CSU and SD concomitantly, but mostly, they're either CSU or they're a Cold or an SD patient. We know they'll be treated by the same doctor population. The endpoints are certainly different. One's using provocations, one's using just scores, but you know, it's the same people that treat these patients. We see this as just a bigger market for itself.
Okay. That makes sense. You know, chronic urticaria has gotten a decent amount of interest from drug developers in recent years, right? I would do pits in there. Ranolumab could be there soon. I guess, with that context, where do you see Barzolvolimab fitting in? I'd just be curious, does specialist subtype affect potential line of treatment? Would you be potentially marketing differently, or are you not thinking about this in a way?
Certainly, we want to see the Phase III data. That will certainly be the definitive test. Based on the Phase II data, as we've said for a while now, we know we can treat the whole patient population, right? It's not like we can treat just the refractory to antihistamine. It's not like we can just treat the IgE low. We can treat the IgEs. We can treat the IgEOs. There isn't a patient within the CSU population that we haven't had some effect on. It's wide open that way. People have asked us, "Where do you think you'll fall?" We're like, "Look, as an entry point, probably behind Xolair. Why wouldn't we see that?" Especially with the allergists. It's going to be interesting to see what happens once Reni gets accrued. There's a derm population that likes DP from what we understand.
I think Reni certainly gives them another choice. It's not a biologic. It's a small molecule. We know derms in other indications use JAK inhibitors. I don't see why they wouldn't use Reni. I think that's the thing we need to watch over the next year or so while our drug gets through Phase III. In our programs, we have derms treating patients in CSU, and they will have them in Sindu. The AD and PN studies are all dermatologists. We think that by the time Barzolvolimab is ready to hit the market, we'll see derms getting very comfortable around it. Either with the derms, it becomes frontline or it slides behind a Reni or a DP first. Like I said, we can deal with the whole population. We don't have to worry so much about if we don't get frontline, it's not going to work for us.
I think that's the optionality around where the drug will fit.
Okay. In terms of just the Xolair experience patients that you mentioned kind of enrolling in the Phase III, what's the thinking behind that? In terms of is it labeling? Is it something?
It's labeling. Yeah, we want to be able to say that we have antihistamine refractory and only refractory on the label, and we'll be the only ones that can say that.
Got it. Okay. That makes sense. Maybe just moving over to EOE. I don't think we need to rehash the entire update there, but just curious to get your thoughts on how and if that program reads through to any other indications you're pursuing or might pursue in the future.
We won't pursue EDI.
Yeah, that's the only program that it will ever read through. No, we don't see it reading through other than PN, CSU, or the AD studies at all.
Got it. Speaking of PN, we've seen a bit of data from that program along with another study from you. You have another study ongoing in atopic derm, right? When can we expect updates from those studies, and what's the read-through from one to the other, PN to atopic derm?
As far as updates go, we'll have better timing around that, probably around the first of the year. The datasets on both will be 2026. It'll just be about when we do that as far as the read-throughs.
Yeah. For PN, we actually already have data from both anecdotal case in our initial Sindu study as well as our Phase Ib study, where with a single dose with Barzolvolimab, we saw a very nice improvement in itch and also started early healing of lesions in PN patients. We think that the form of itch that is in prurigo nodularis, which is non-histaminergic itch, is a similar mechanism to atopic dermatitis. You know, we believe just from an itch standpoint, those results should translate. There's probably other parts of the pathophysiology of the inflammation where the mast cells are involved as well. We're very encouraged about both the PN and the AD indications.
Right. PN and the lesions is where the mast cells reside. We're looking for that dual effect of taking care of the itch as well as healing the lesions.
Okay. That makes sense. Maybe just to take a step back to kind of the broader development in the space, there are a few other KIT programs in development. I think there have been kind of mixed updates, arguably, from some of them. I guess, do you see Barzolvolimab as competing with these other KIT programs at this point or needing to be positioned relative to those, or is it really competing with kind of, you know, standard of care in the indications you're going into?
We believe standard of care, and we're close enough, being in Phase III, that that's who we need to worry about. The others are further behind. As they get more data, we can take a look. Certainly, we see Novartis and Sanofi right in front of us with drugs that work very well. That's what we're going to focus on.
Great. I want to make sure we touch on CDX-622, the bispecific that you mentioned earlier. Maybe you could just go a bit deeper on the mechanism, where you see potential for this drug. I know you mentioned asthma, but what other indications could potentially make sense? I thought maybe you said EOE could even make sense for this one, but no, that one's bad.
Yeah. We're excited about CDX-622. This is a bispecific antibody with the concept of combining mast cell depletion with another pathway. In this case, rather than targeting KIT directly, we're targeting the ligand stem cell factor, and we've combined that with our own highly potent TSLP neutralizing antibody. I think there's been a lot of excitement around the TSLP data that's been generated. There's obviously been some approvals and strong Phase III data, a number of pulmonary indications. I think there's Phase III studies coming out soon. We really like the combination. We think these two pathways play important non-redundant roles. Certainly, asthma is one, but other pulmonary indications, COPD, other fibrotic conditions, are on the table. We're also pretty excited about the potential for the SCF neutralizing antibody that we've developed, having a potentially differentiated safety profile, which might allow us to consider different patient populations, including younger patients.
Food allergy has been something that we've been interested in getting into for a long time. A lot of options for 622. We're presenting the single ascending dose in healthy volunteers, which will be important as a first step, but as Anthony mentioned, we've got a couple more hurdles to get through the initial data and then a proof of concept study. Asthma patients will set us up, along with our subcutaneous formulation, which is also starting soon, before we enter into Phase II studies and make those decisions on which indications we're going to pursue.
Is there anything in terms of the healthy volunteer study point us towards, you know, whether it's PD data or certain indicators you're looking for?
Yeah. From a PD point of view, the most relevant will be tryptase levels, which will tell us about systemic mast cell inhibition. We'd really like to see some impact on tryptase, of course. With the bispecific, any new bispecific molecule, if you want to demonstrate that pharmacokinetics are good, that you don't have a big immunogenicity problem, and obviously the safety aspects, particularly focusing on some of the KIT-related adverse event profiles.
Okay. Great. Maybe just wrapping up the company-specific portion of the questions, can you remind us of cash runway and what catalysts or milestones are kind of?
Sure. At the end of the quarter, we have $630 million. We've guided that that will take us through 2027 and into 2028. The readouts would include the Phase III for CSU, the two Phase IIIs for CSU, the Sindu study, I'd say, and then the AV and PN Phase II studies, certainly the 622 MAD and SAD studies, as well as starting off the preferred mechanism study and asthma, and then some. You need to get through all those value creating points, and you'd be able to do very well.
Okay. Anything we didn't touch on that you'd highlight?
No, I think you've touched on a number of things. I mean, people certainly want to know, what's the timing around data? When are you guys going to tell us about data? I think you've been very upfront about it. You know, when we're done with the accrual, we'll put out the press release. We'll tell you when we think data will be there, and we'll be ready to present that data. We look forward to doing that. No, I think you've covered it very well today.
Okay. We've got a kind of mini survey that we're asking all of our management teams. Before I do that, if there are any questions in the room, we do have mics if anybody wants to raise their hand. I'll go on with this mini survey. Biotech seems to be more exposed to external and macro factors of late. We're asking each of the management teams three thematic questions. The first is, China's rise in biotech innovation, how are you thinking about your competitive position? Will this influence R&D or potentially business development strategy for Celldex Therapeutics in any way?
I think I'll let Tibor take on the R&D aspect. We've had collaborations with Chinese companies in the past. I mean, they have good science, but I think what's coming out of our labs is unprecedented. We're now the mast cell biology leaders. Certainly, Tibor can talk about things that are coming out of his lab beyond 622. It's something we always have to think of, but certainly, we're happy where we are. Tibor?
We've fully recognized the force that the Chinese biotech companies are, and they've become incredibly efficient and innovative in driving technology that's directly competing with many things that we're doing. At the end of the day, though, we have to focus on our science and our technology and what we're doing. We feel very comfortable with our capabilities and our ability to stay as, you know, leaders in this area of, you know, mast cell targeted therapeutics.
Yeah. I mean, just as a matter of how we developed it, it's been basically less than five years, right? We've taken Barzolvolimab from preclinical all the way to now to Phase III. I don't know how much more efficient it can get, but we're happy with where we are.
Okay. Great. The next thing is AI. How would you say you're currently leveraging AI or thinking about AI's potential to disrupt the industry, both positively and negatively?
I think for us, AI is still at the very early stages of what it can possibly do. I mean, we're looking at it on the business end. We're looking at it on the legal end. I'm sure Tibor and Diane are looking at it on their respective ends as well. We need to better understand all these systems that are out there, what it's capable of doing, what the unintended consequences are, which you can never fully appreciate. I think what we're trying to do is, okay, you know, where do we want to be in the future? Where do we think people are focusing their energies on? I mean, we know in our area, it's all about improving throughput and things of that nature. Certainly, I think we're at the early stages of it. Yeah.
Certainly, I'm sure we'll be involved with AI in some way, shape, or form. It's just I can't tell you how at this point, but we will have AI math capability. Tibor, on your end?
I think AI is extremely powerful, and we are using some forms of it. I think the challenge that I see is always appreciating whether the information you're getting out of it is accurate and complete. That becomes challenging. It's very easy to rely on what information you get, and sometimes hard to know just how accurate that is.
Makes sense. The last one is on the regulatory side of things, you know, in terms of impacts to your business from the regulatory side. Changes at FDA, MFM pricing, tariffs, anything kind of in those areas or elsewhere, that's impacting the business day-to-day or your strategy.
We haven't seen any change with the FDA.
Yeah, we're obviously watching it. So far, so good, but we're paying close attention to FDA changes.
As far as tariffs go, you know, we're going to wait and see what happens with tariffs. Certainly, everybody that's in this business who buys supplies are seeing, you know, a slight increase because of tariffs. That's something that I think we can deal with. We're organizationally setting things up so we have dual vendors. Not only is it a good business way to do things, but operationally, you need that backup or second source. As far as the tariffs go, it just is what it is. We didn't move as.
Pricing? If you're thinking about that at this point?
We're having those conversations now. In fact, some of the questions we're getting is, based on the benefit you're giving, are you looking for premium pricing? We'll certainly try, but that's a conversation that we'll have to have. Certainly, they'll want to see the Phase III data. If it holds up, we'll look to get the best price available. We want to make sure the drug's available for patients. That's the key to us.
Okay. Great. There are no questions. I think we'll leave it there. Thanks again.
Okay, thank you so much. Appreciate it.
Thank you.