Good afternoon, everyone. Thank you for standing by. Welcome to CytomX Therapeutics Third Quarter 2026 Financial Results Call. Please be advised that today's call is being recorded. I would now like to hand the call over to your host for today, Chris Ogden, CytomX's Chief Financial Officer. Please go ahead.
Thank you. Good afternoon, and thank you for joining us. Before we begin, I would like to remind everyone that during this call, we will be making forward-looking statements. Because forward-looking statements relate to the future, they are subject to inherent uncertainties and risks that are difficult to predict, and many of which are outside of our control. Important risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov. Except as required by law, we undertake no obligation to update any forward-looking statements, whether as a result of new information, future developments, or otherwise. Earlier this afternoon, we filed our quarterly report on Form 10-Q for Q3 2026 and issued a press release with a summary of our third quarter 2026 financial results and business highlights. We encourage everyone to read today's filing and press release.
Additionally, the press release, recording of this call, and our SEC filings can be found under the Investors and News section of our website. With me on the call today is Dr. Sean McCarthy, CytomX's Chief Executive Officer and Chairman. Sean will provide an update on our pipeline and company progress before I cover the financials for the quarter. We will then conclude with a Q&A session. With that, I'll turn the call over to Sean.
Thanks, Chris, and good afternoon, everyone. We're very pleased to be here today to provide an update on our third quarter developments and what continues to be a highly productive year for CytomX as we advance our lead program, Varseta-M, towards its first potential registrational study in the first half of 2027. Varseta-M is an EpCAM-targeting Topo1 antibody-drug conjugate with strong potential in colorectal cancer and potentially other solid tumors. Importantly, to our knowledge, Varseta-M is first in class as the only EpCAM-directed ADC in clinical development. Varseta-M has been intentionally designed and uniquely enabled by our PROBODY platform, creating a significant opportunity for differentiation and long-term value creation. Strategically, we are initially developing Varseta-M in metastatic colorectal cancer as the lead indication.
Our sense of urgency for Varseta-M is driven by the significant unmet need in colorectal cancer, which is the second leading cause of cancer death in the U.S. and worldwide. Varseta-M is on the leading edge of ADC innovation in CRC and has the potential to be one of the first monotherapy ADCs to market for the treatment of this very challenging cancer type. In terms of commercial potential, there are an estimated 35,000 addressable patients in the U.S. with third-line or later CRC. Given the anti-cancer activity we have reported previously across an unselected late-stage patient population and the limited clinical benefit of existing therapies for these patients, we see considerable opportunity for Varseta-M. Based on Varseta-M's unique profile, we are actively advancing our development program across three strategic areas of priority.
First, we aim to move Varseta-M monotherapy into a registrational study in the first half of next year, enabling a potential first approval and meaningful market opportunity in metastatic CRC. Second, we continue our development of Varseta-M in combinations, including with bevacizumab and with earlier line chemotherapy regimens, with the goal of replacing current standard of care. Third, we have started to evaluate Varseta-M's pan-tumor potential across multiple EpCAM-expressing cancers, initially in additional gastrointestinal indications. The monotherapy Varseta-M phase I study has enrolled more than 100 patients across dose escalation, expansion, and optimization cohorts. As previously reported, patients enrolled in the phase I study have been heavily pre-treated, with most patients having received three or more prior treatments in the metastatic setting. In March, we reported encouraging progression-free survival at doses of 8.6 and 10 milligrams per kilogram that exceeded current standard of care.
We also shared our increasing understanding of the safety profile of Varseta-M, particularly how to lower and manage rates of high-grade diarrhea. This initial experience with Varseta-M in very late-line patients will provide us with a highly relevant dataset to enable monotherapy dose selection and inform the potential first registrational study design. Most recently, we have been highly focused on dose optimization, evaluating two doses, 8.6 and 10 milligrams per kilogram, given every three weeks, with adjusted ideal body weight dosing and upfront prophylaxis to manage gastrointestinal adverse events. We anticipate providing an integrated update in January across the phase I study, including our potential registrational strategy and the data that underpin our plans. It's important to note here that we expect this next update to provide the first look at overall survival for Varseta-M, which we anticipate will be the primary endpoint in our initial registrational study.
We look forward to providing this next update in the near term. Now moving on to the Varseta-M combination development program. Our ongoing phase I study evaluating Varseta-M in combination with bevacizumab continues to enroll late-line CRC patients to assess dose and safety. We view this combination as a foundational first step in evaluating Varseta-M's potential in earlier line CRC. Subject to data from the ongoing phase I study, we anticipate moving to earlier line CRC patients in the future evaluation of this combination, and we anticipate reporting initial clinical data from the bevacizumab combination in the first half of 2027. To also enable the use of Varseta-M in earlier lines of CRC therapy, we remain on track to initiate a study evaluating Varseta-M in combination with bevacizumab, five-fluorouracil, and leucovorin by the end of the year.
This study will be a new phase I/II trial that would enroll second-line CRC patients once phase I dose finding is successfully completed. We believe these Varseta-M combination studies have the potential to inform future development options and look forward to providing initial updates starting next year. Moving to the development of Varseta-M outside of CRC. Our strategy is to develop and ultimately commercialize Varseta-M across multiple EpCAM-expressing solid tumors, and we have recently initiated phase I cohorts in gastrointestinal indications with substantial unmet clinical need, and that we view as highly complementary to CRC from a commercial perspective. We have initiated cohorts in unselected gastric and gastroesophageal junction cancer, as well as EpCAM-selected pancreatic ductal adenocarcinoma and EpCAM-selected biliary tract cancer.
Each of these EpCAM-expressing tumor types currently have limited treatment options in later line settings and may present expedited development pathways for Varseta-M upon clinical proof of concept. Our initial plan is to enroll approximately 20 patients per tumor type to evaluate Varseta-M's anti-tumor activity and safety before assessing later phase development options. Having focused Varseta-M exclusively in CRC for the first two years of development, we are very excited to now be evaluating Varseta-M's broader clinical potential. Turning to CX-801, our masked interferon alpha-2b program being evaluated in checkpoint refractory melanoma. We see CX-801 as an exciting and broad opportunity to reprogram the immune responsiveness of solid tumors, and we continue to enroll the ongoing phase I study evaluating CX-801 as a monotherapy and in combination with KEYTRUDA.
Enrollment in the monotherapy cohort of our phase I study continues, having exceeded dose levels of the approved dose of unmasked interferon alpha-2b. Initial biomarker data for CX-801 monotherapy presented previously have reinforced our mechanism of action hypothesis for CX-801 in combination with KEYTRUDA. We continue to enroll in the combination cohort, and we look forward to sharing initial clinical data from the phase I study in melanoma in the first half of 2027. With those updates, let me now transition the call back to Chris.
Thank you, Sean. As Sean highlighted, we are making important progress across the Varseta-M program, including potentially moving towards later stage development. As we progress the broadening Varseta-M development program, we have continued to maintain an efficient and flexible cost structure, enabling us to pursue the opportunities Sean described earlier. To that end, with our current balance sheet, we project cash runway into the second half of 2028. Importantly, our runway funds our key value creation priorities that Sean outlined, including advancing Varseta-M into its first potential registrational study, pursuing combination development to move Varseta-M into earlier lines of CRC, and then expanding into multiple other EpCAM-expressing gastrointestinal tumors. With that, I am going to walk through our third quarter financial results. As of September 30, 2026, we ended the quarter with $348 million in cash equivalents, and investments, versus $330 million in cash as of June 30, 2026.
The cash balance as of September 30, 2026, includes $37 million received from Regeneron following its selection of two additional targets under the recently expanded collaboration. Looking at revenue and operating expenses for the quarter, total revenue was $1.7 million compared to $6 million in the third quarter of 2025. The decrease in revenue was primarily attributed to the conclusion of the Astellas collaboration in the second quarter of 2026. Operating expenses for the third quarter were $25.2 million compared to $21.7 million in the third quarter of 2025. Research and development expenses were $16.5 million during the third quarter, representing an increase of $1.2 million versus the third quarter of 2025, primarily due to increased personnel-related costs and partially offset by lower Varseta-M spending due to the timing of manufacturing activities.
General and administrative expenses increased by $2.3 million during the three months ending September 30, 2026, to $8.7 million, compared to $6.4 million for the corresponding period in 2025. Increased G&A expenses were primarily driven by personnel-related expenses and higher consulting spend. As we move towards 2027, we will continue to be disciplined in capital allocation in order to progress the most compelling Varseta-M development priorities and realize the broader value creation potential for CytomX stakeholders. With that, operator, let's go ahead and open up the call for Q&A.
Thank you. At this time, we will conduct a question-and-answer session. To ask a question, you will need to press star 11 on your telephone for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Paul Jeng of Guggenheim. Your line is now open.
Oh, great. Thanks for taking the question. So I guess my first question is, can you expand a little bit about the Bev chemo combo study that's getting underway this quarter? Anything about the target enrollment number, and will this exclusively enroll second-line patients from the outset? On the patients themselves, are you focusing more on patients coming off a FOLFOX-based frontline regimen, or do you otherwise plan to stratify by any key baseline characteristics? Then I have a follow-up.
Great. Thanks for the questions there, and we are really excited about the progress overall with the program, and particularly moving further downstream with Varseta-M into the combination setting. As we pointed out, the gaining of experience with Varseta-M in combination initially with Bev, which is ongoing, and soon to start with Bev plus chemotherapy is a really important component of the program. We do anticipate initially in the first part, the phase I part of the study, that we will enroll most likely late-stage patients as we dose range and gain initial experience of the combination strategy. Then as we open up further down the road, the phase II part of the study, that would enroll second-line patients. That is really all the detail that we are ready to give at this moment in time.
Oh, great. My second question would be great to get your current perspective on the broader landscape of ADCs in colorectal now that there is a few competitors in phase III, as well as some recent data from emerging targets at ESMO. How are you currently thinking about the positioning of Varseta-M, given many of these are also using TOP1 payloads? Thank you.
Yeah, it is actually really exciting to see the field evolving in the way it is. I think we can say now quite clearly that antibody drug conjugates are coming to colorectal cancer patients. It has been a long time coming, and this is just a really exciting development for the field overall, and of course, for the patients who are waiting and in desperate need for these innovative therapies. I want to really emphasize, in addition, of course, that our drug, Varseta-M, is the only EpCAM-targeting ADC. We are first in class on this target. We think that is a direct reflection of our proprietary masking technology. We have really been able to do something that no one else has been able to do. We think that puts us in a strong position from a differentiation standpoint over time.
With regard to the other programs, yes, there are several to watch, and we are keeping a very close eye on them. The AbbVie program, Temab-A, the Merck Serono program, Precem-TcT, and then more recently, I think as you are alluding to, including at ESMO, a number of CDH17 ADCs that have shown some encouraging, we think, preliminary data. We believe we have got a very competitive asset here, and it really underscores and fuels our urgency to move Varseta-M forward as rapidly as we can.
Great. Thank you.
Thank you. One moment for our next question. Our next question comes from the line of Etzer Darout of Barclays. Your line is now open.
Great. Thanks for taking the question. Guess the first one, just curious about the OS update in January for the first 73 or so patients. If you could maybe comment on, when you think about third versus line setting versus pursuing a faster fourth line setting, is there a threshold relative to the roughly nine months OS benchmark in Bev-experienced patients receiving LONSURF plus Bev that you're looking at to decide whether you're going to go after maybe a third line versus a fourth line indication, knowing that the fourth line would probably get you to market faster? How are you thinking about that? I have a follow-up.
Thanks. That's a great question, and you quite rightly point out the nine-month, there or thereabouts, OS that has been reported for bev-LONSURF in the post-bev setting per the SUNLIGHT trial. That is an important number that we are looking at relative to other components of standard of care in the third line plus. We continue to evaluate these options as we look towards just potentially initiating this first registrational study in the first half of next year. We're continuing to look at these two options in terms of how we increasingly think about third line plus as the place to go. Really, the key questions for us are, in this first pivotal study, what will the patient population be? What's the appropriate comparator in that patient population?
Because I want to remind you that in the third line plus setting, although bev-LONSURF is, of course, thought of as the dominant therapy in the third line, treatment of third line patients and later is actually quite fragmented. We see, as we really lock in on this study design, we think there is a number of ways to go to capture a significant portion of the third line plus market with a number of different designs. So, more to come on that. Your question also does allow me to restate what I said in my prepared remarks, which is that we do anticipate that in this first registrational study, that OS will be our primary endpoint in a randomized study.
Great. Thank you for that. Then for the January update now, is that primarily a conference timing and data maturation? Just wondered if you could comment on that in terms of now the data being in January next year.
We haven't specified the forum at this time. That will come in due course.
Thank you.
Thank you.
You're welcome.
One moment for our next question. Our next question comes from the line of Ted Tenthoff of Piper Sandler. Your line is now open.
Great. Thank you very much. I wanted to ask, with respect to the Avastin chemo arm, the study that you're going to start in which it looks like you're replacing oxaliplatin, what safety endpoints are you going to be evaluating there to see whether or not the combination with Varseta is better tolerated? Maybe you can remind me how large that study would be. Thank you very much.
Hi, Ted. Thanks for the questions. The strategy in the bev chemo combo will be to replace irinotecan with the ADC. The TOP1 ADC really having been designed with that as one of the goals in mind. That's a very important part of the strategy. In terms of the safety profile, this work is all about initially evaluating the combinability of Varseta-M with these other agents. One of the things that we think could be very attractive about the Varseta-M safety profile that we've learned a lot about so far is the quite remarkably low rate of hematologic toxicity we see with Varseta-M relative to other TOP1 ADCs in development in CRC and elsewhere. We think that certainly is an advantage. I'd say the area that we'll be paying closest attention to would be the GI toxicity.
We know that we have a certain rate of grade 3 diarrhea with Varseta-M. It is something that we're continuing to learn a lot about and getting an increasing handle on, but that is something that we'll be watching very carefully in combination, particularly with five-FU. I would also say that, irinotecan, since we're switching out irinotecan for Varseta-M, irinotecan itself has been known since the early days of its development to have its own rate of grade 3 diarrhea. We're switching Varseta-M for irinotecan, which I think could work in our favor, but we really need to do the work to evaluate the combinability.
Yeah. Makes sense. Would you be implementing the AIBW dosing and diarrhea mitigation in those studies, just as you have with monotherapy of Varseta? Thanks.
I think that's most likely, yes. Since we're still in the late stages, but we are coming to the later stages, and I think soon a conclusion from our dose optimization work that we've been doing across the 8.6 and 10 MPK AIBW schedules, two, three-week schedules. Until we really pin that down, I can't say for sure, but I think it's not unlikely that we would be using AIBW moving forward in those additional combination studies.
Yeah. Makes sense. Thanks. Keep up the important work.
Thanks.
Thank you.
I appreciate the support.
One moment for our next question. Our next question comes from the line of Anupam Rama of JP Morgan. Your line is now open.
Hi, thank you so much for taking the question. This is Brooke on for Anupam. What drove the shift of the monotherapy update from year-end 2026 to January? Is it more patient follow-up or waiting on FDA feedback? Thank you.
Yeah, as dose optimization has continued, we have really wanted to allow time for sufficient follow-up to assess safety and efficacy, and also allow for the full engagement and feedback from regulatory authorities. We are looking forward to the update in January.
Thank you. One moment for our next question. Our next question comes from the line of Roger Song of Jefferies. Your line is now open.
Hey, thanks, team, for taking our questions. This is Nabil on for Roger. A couple from us. I guess, regarding GI durability, it is encouraging to see the 10% grade 3 in the two months. As we get longer follow-up, I was just curious how you are thinking on time of onset, duration, and recurrence. Then, as we go into second-line, you mentioned earlier with five-fluorouracil, we know that that may add some toxicity. We know that, as you mentioned, it is remaining tyrosine already used in that second-line. But what is the target for the GI that we are looking for?
Yeah, thanks, Nabil. Great questions. As I mentioned earlier, we're continuing to learn a lot about the safety profile of Varseta-M. We did, as you also rightly point out, in March this year, report our initial experience in dose optimization, showing that after two months of matched follow-up with the patients in dose optimization cohorts, the first 20 patients in dose optimization cohorts across the two doses of 8.6 and 10 MPK, a rate of grade 3 diarrhea of 10% relative to more than 30% in the time-matched patients from escalation and expansion. So, an encouraging start. I think we've been pretty consistent in talking about our goal for grade 3 diarrhea based on work that we've done talking to oncologists and other market research that we've done, that we would like to manage the rate of grade 3 diarrhea to 20% or below.
We think that that is a more than acceptable rate in this disease. Obviously, we want to do the best we can in terms of leveraging the prophylaxis strategy, which in the March update was certainly showing a very good start. Just a little bit more detail. Let me just sort of go into a bit more detail on, since you mentioned time to onset. We've reported previously that time to onset for grade 3 diarrhea with Varseta-M at these doses is about five weeks. We've reported that it does not appear to be cumulative. We've also spent a lot of time over the last few months looking not just at the grade, but also digging deeper into the patient experience in terms of what is the amount of time that a patient spends in grade 3, and what is the burden overall?
That's something that we'll have more to say about over time. The reason I point that out is that, of course, the goal of managing really this one significant AE that we have to think about with Varseta-M, the safety profile of Varseta-M overall we think is highly attractive. Our goal in managing the high-grade diarrhea is, of course, to maximize dose intensity. We do anticipate that dose intensity will be an important determinant of efficacy, particularly in regards to PFS and OS over time. So, ongoing work, and we continue to learn more all the time, and we'll look forward to providing the update in January. Thanks for the questions.
Yeah, thank you, Sean. If I could ask a follow-up.
Yeah, go ahead, Nabil, please.
Yeah, so kind of taking a step back, we see the ESMO updates, encouraging to see more progress being done here. Curious if we take a step back and look at just the target itself, EpCAM, compared to targeting CEACAM5, both are glycoproteins. Can you comment on the rate of shedding compared to CEACAM5 for EpCAM? We know that CEACAM5 is more readily shed into the bloodstream. Do you think that, in that regard, EpCAM has a more favorable target profile?
Well, we do see EpCAM, I would say, compared to CEACAM5, being somewhat more highly and broadly expressed, although CEACAM5 is an abundant and broadly expressed target, which the data that I've seen is not so far from patients that have been selected for target expression. But we do continue to like EpCAM quite a bit as a target. In terms of shedding, I don't really have anything to say there in terms of the comparison across the targets, and it's not to be honest, something that we've spent a lot of time thinking about. But maybe we'll come back to you on that.
Thank you.
Thank you. One moment for our next question. Our next question comes from the line of Olivia Brayer Saunders of Cantor. Your line is now open.
Hi. Good afternoon, guys. Thank you for the question. I wanted to follow up on the January timeline or timing. Can you disclose what follow-up threshold you guys are looking to achieve, especially as you think about safety follow-up, but also thinking through survival? Is this more about accruing events over time? I guess I'm trying to understand whether it's more about the dose expansion population or the 40-patient dose optimization cohort.
Yeah. Hi, Olivia. We've, I think, again, been pretty consistent here for a while now in terms of our goals and strategy for data disclosures. If we go back, I guess, well, more than a year and a half, when we were approaching the data coming out from escalation and expansion, we communicated that we would share those updates, which we did in March this year, when we had an initial sense of progression-free survival on a dose-by-dose basis. With regard to the optimization data, similar guidance that we want to be able to share PFS from the optimization cohorts in the context of the first look at OS from escalation and expansion. The January, as I mentioned earlier on, the January update is simply to allow sufficient time to give as robust an update as we think is appropriate.
That's helpful. Sean, on the optimization cohort, how are you guys thinking about breaking out efficacy between patients who received an AIBW-adjusted dose and those who didn't? I'm not sure if you can share this number, but any sense of what proportion of those 40 patients actually required a meaningful dose adjustment?
Well, every patient's dose would have been calculated using the AIBW algorithm. I think it's a good question, but I would reframe it a little bit in terms of ultimately what's the dose, of course, what's the absolute dose that a patient receives and what's the dose intensity achieved over time? That's the type of data that we're going to be analyzing and that we will be sharing in due course.
Okay. Understood. Looking forward to it. Thank you very much.
You're welcome.
Thank you. One moment for our next question. Our next question comes from the line of Kalpit Patel of Wolfe. Your line is now open.
Hi. This is Nikki on for Kalpit. We wanted to ask if, as you gain additional experience with the optimized dosing regimen, would you be able to give us any granularity on what that selected dose might be for the phase III or what you're leaning towards? Thank you so much.
Yeah. Thanks for the question. Can't provide any additional color at this moment in time, but that will be an important component of the update in January.
Thank you.
Thank you. I'm not showing any further questions in the queue. I would now like to turn it back over to Dr. Sean McCarthy, Chairman and CEO, for closing remarks.
Thank you, and thanks, everyone, for listening in today. We continue to be highly encouraged by the progress we're making here at CytomX with Varseta-M, with CX-801, and more broadly with our PROBODY therapeutic platform. We're excited about the breadth of opportunities in front of us as we drive toward the end of the year and rapidly, as it seems, into 2027. Thank you all for your time today.
Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.