My first one in this room. Oh, you're live. All right, good morning, everyone. Thanks for joining us. My name is Jonathan Chang. I'm part of the Leerink Partners Equity Research Team. It's my pleasure to host the management team of Xencor. We have with us today President and CEO Bassil Dahiyat, and we have Dane Leone, SVP of Corporate Strategy. And to the people in the room, if you have any questions for the team, feel free to raise your hand, and we'll certainly try and get to you. Thank you guys for joining us. Would you like to take a few minutes to briefly introduce the company?
Sure, I'd be delighted. So we're a company that was founded to use protein engineering tools to create new therapeutics, and we focused our work on building the necessary modules and tools within the antibody structure to create new drugs. And we've created a portfolio of tools we call our XmAb suite that allows us to build really, you know, bespoke monoclonal antibodies, bispecific antibodies, fusion proteins that we develop primarily in oncology and in autoimmune disease. We have a portfolio of clinical programs right now focused on oncology, as well as a series of partnerships and licenses that we've done that create a business that helps support our internal development efforts.
Great. That was a punchy intro. All right. Can you discuss Xencor's protein engineering platform and what makes it unique in the competitive landscape?
Sure. So we were originated as protein engineers, which means that the core of everything we engineer is the robustness and the biophysical stability of the molecules. And that is what gives us the incredible flexibility, excuse me, and span of different kinds of molecules we can create, and the modularity and portability. So there's something like 20 different programs in clinical development right now that Xencor has built. There's three marketed products. And that's that sort of span is really supported by the incredible portability of the molecules we create.
So we built our XmAb technology on that scaffolding region of antibodies, the Fc domain, and that, that toolkit we've built of Fc domains lets us create longer half-life molecules, higher effector function molecules, create bispecific structures that you can truly arbitrarily decorate with different kinds of binding domains or active molecules in a plug-and-play manner. And that's possible because of that, that focus on biophysical properties, making sure our molecules are just as stable, just as soluble, just as easy to make, and long-lasting as natural antibodies, so mimicking, you know, those billion, hundreds of millions of years of evolution. So that's what makes it special. A lot of people can stitch together novel drug constructs, but to do it in a way that creates really portable and, easy-to-use technologies, that's a much harder, harder problem. So that's what makes us special.
Got it. Now, given the potential breadth of the platform and the previously announced prioritization efforts, what are the key areas of focus for the company?
So, you know, within our focus in oncology, the key area for us is a set of molecules and a mechanism that's really started to gain initial proof of concept in the clinic, and that's T-cell engagers for solid tumors. So the idea of making bispecific antibodies to engage T-cells has been around now for a little over a decade, and there's been some successful drugs in heme malignancies, but solid tumors have been a much tougher nut to crack. There's challenges, I think, primarily with the kinds of targets you can hit that are rich on a solid tumor because those targets are often expressed on healthy tissue.
And to find targets and then, more importantly, to build these molecules, to build these drug candidates that can separate out that kind of, that kind of addressing of your, your cytotoxicity to the tumor and avoiding the healthy tissue, healthy tissue that would, with solid tumor targets, you, you have to avoid, things like your liver, your kidney, your lungs, that technology is something that's just emerged, and we've been at the forefront of that. You know, so we're very, very excited at the opportunity to, to build a portfolio of solid tumors. We have three programs, two in the clinic, one that's about to dose its first patient that uses this new T-cell engaging technology for solid tumors, partners that have demonstrated proof of concept.
Most recently, Amgen's xaluritamab program in prostate cancer showing remarkable over 40% response rate in late-line prostate cancer, very promising durability, and a very expansive development program, a late-phase development program, Amgen's about to kick off. So with that proof of concept of our platform and of the way we build these solid tumor T-cell engagers, we think that the stage is set for our portfolio.
Got it. Dane, agree or disagree?
He disagrees completely.
Oh, he disagrees.
No, it's a natural progression, right? We saw T-cell engagers have profound impact on hematologic malignancy. Several drugs are now approved in multiple myeloma and lymphoma. And now it's porting that clinical algorithm over to solid tumors. And to what Bassil said, the format that Xencor uses is now proven with several bispecifics. We're going to have a T-cell engager, tarlatamab from Amgen, not using our format, but still important for the field, probably by June this year. So the field is moving fast, and we're excited to be there right with it, with our dose escalation of 819 in renal cell carcinoma.
Great. Let's switch right there. So, on your 819, your ENPP3 x CD3 program. First, can you tell us about ENPP3 as a target, and what's the rationale going after this target with a 2+1 T-cell engagement?
Well, I'll start on that, on that side. So ENPP3 is a protein. It's an enzyme that is heavily overexpressed in renal cell carcinoma, particularly in clear cell renal cell, which is the greatly predominant subtype. About 85% of patients have clear cell renal cell. So they express a lot of this ENPP3 target. So I think it was just an address, forget its enzymatic function for now. It's a natural function for now. It's a great address on renal cell carcinoma cells, and it happens to have fairly low or much lower expression than it has in those tumor cells across the healthy tissues that its normal job is on, tissues like the kidney, tissues like the prostate, tissues like the liver. So much lower expression. We sought out a target that had that kind of pattern: very high in tumors and much lower in healthy tissue.
We searched, you know, the databases and then did our own supporting experiments with human tissue because we know that we can build molecules, in particular with our new 2+1 XmAb format, that use this flexibility of our XmAb tools and of our robustness of our Fc domains to array two binding domains to this target. So the key here is you've got cooperativity when you build these binding domains right. You make them kind of weak, actually. So any one domain by itself can't latch on and hold on tight enough to the cell, but two of them can. That means you're going to bind tightly and well to the tumor cells that have a lot of handholds, a lot of copies of that ENPP3 target, and the healthy cells, which have a lot fewer, you're not going to stick to.
And that's key because sticking to a cell is what allows the other part of the bispecific, the CD3 binding part, to stick to the T-cell and light it up, right? And so that control, which comes from a fairly simple concept, two binding domains to the tumor and one to the T-cell, that's a very powerful tool we have now. It's a simple concept, but it's very hard to implement easily and robustly in your molecular engineering because it's unnatural, right? So that's the design of the molecule and how it exploits this property of the target that we'd sought out.
Got it. Can you talk about the phase I study of this program and how that has progressed?
Yeah, sure. Dane, you want to take that one?
Sure. We, as we said on our earnings call, we're very excited about continued dose escalation. We convened an ad board around ASCO-GU in January, discussed the program with a number of investigators who are all very supportive of the progress that we're making. As you know, in dose escalation, especially with a T-cell engager, you have to go through the DLT period. There's dose escalation. There's also dose optimization. So we're pushing as fast as possible to get to what we modeled to be the effective target dose levels, hopefully by year-end, and then be able to share data externally post that. When we think about the clinical opportunity, renal cell carcinoma, especially clear cell, quite interesting. Most patients in the first and second lines will get some sort of IO exposure or some sort of TKI exposure.
There's not really a hard consensus of what you use. Our investigators, when we went around the room at our ad board, all had different opinions of how they sequenced different therapies, right? So our hope with the program is, one, we can have exciting clinical anti-tumor activity, at the effective dose ranges, but also have an orthogonal tox profile that allows us to move into the earlier lines as rapidly as possible. There was a recent approval of belzutifan, from Merck, which is a HIF-2α targeted agent, a little different in concept, but underscores that there is a real need in these later-line renal cell carcinoma patients where that drug, I think, had somewhere between a 5-6-month PFS, 22% ORR, and, you know, it was an advance over a patient receiving everolimus in the later line.
So there's a great development opportunity there, and we're excited to keep pushing forward.
Got it. Just to clarify, so if I heard you correctly, so data, initial data from this program, could be presumably a 2025 event and unlikely to be a 2024 event, correct?
Yeah. I mean, what we've tried to lay out for people is, when we think we would have a clinical decision point and when we would have the clinical decision point, we would obviously communicate that externally, to the investor community. In this case, there's kind of two factors. There's one, making sure we have the right dose optimization, and that could be IV. That could be subcutaneous, as we're exploring both and the dose escalation, to really understand what the next steps are and have those locked in before we really share the data.
Because the other factor is there's a competitive aspect to it, a peer of ours, you know, started a program in December, and that is validating to us that, you know, this is an interesting target, which builds upon an earlier ADC study targeting ENPP3 that had toxic-prohibitive toxicity, but, but good clinical activity. You know, as we saw with xaluritamab , right, if you outline the clinical optimization for dosing too early, that could really help other people out. We want to be mindful of the competitive aspect of this T-cell engager landscape broadly and really only flip that card publicly once we're locked in for the next steps.
I'm assuming 2025.
Yeah.
Clinical decision point.
We think first half 2025 would be.
Okay.
a clinical decision point.
Understood. Understood. Are there learnings from the Amgen STEAP1 2+1 program, which you mentioned earlier, and uses the Xencor technology?
Yeah. There's plenty of learnings. So first, you have to sort of put in your mind the differences between STEAP1 and ENPP3, particularly in where it's expressed in the body and at what levels. So STEAP1 and ENPP3 are expressed at relatively similar levels, though STEAP1 is perhaps a little bit more broadly expressed across different tissues. The more of that target you have in the body, the more deliberate and careful you need to be with your dosing of the bispecific to avoid the predominant toxicity of bispecific CD3 engagers, which is cytokine release syndrome, right? If you have a lot of activity coming from your bispecific, the T-cell's going to release cytokines. It can be very toxic. The established now approach to mitigate that, which is quite effective, is to start with a low priming dose on day one.
You come back on the second dose, whether it's a week or two later. You step up the dose, maybe threefold, maybe fivefold, maybe only twofold, and then you go to your top dose, maybe another week later or two weeks later. So you have a prime and step up to your target dose. So that approach mitigates the CRS because the T-cells can be gently turned on. Now, that's harder the more target you have because you have more T-cells getting turned on because there's more stuff for the bispecific to stick to. And so with STEAP1, they had a particularly challenging case as a fairly broadly expressed target.
So they once cautiously stepped up, and they also hit upon the idea of intensifying the kind of standard premedication you give, when you infuse these kind of active drugs into patients, particularly steroid pretreatment, which calms that immune, acute immune response down. They hit upon intensifying it, adding a predose 12-18 hours prior, as well as right when you dose. That certainly had a big impact mitigating their early CRS. We've adopted that. We've adopted some of the thinking they have in how you want to set up for the future, which is initially, in clinical trials, you need to monitor patients overnight. When you have these, that was really interesting and symbolic. We're breaking the paradigm and unleashing the chains on drug development. And that was exactly the theme that I wanted to express today.
Excellent.
Yes.
Well-timed.
Exactly. So you want to, you want to be careful with patients in clinical trials until you observe them overnight when you have these initial doses of these very active drugs, just in case the CRS comes on a few hours later. However, you don't want to have that in clinical practice because it really, you know, makes it more difficult for patients and doctors to receive the treatment, particularly for things like prostate cancer or renal cell carcinoma, where they use the outpatient care. And so, so you want to reduce that load. And so they've already come up with plans for running phase I cohorts where you back off and you do reduced monitoring.
There's tools that are, you know, we're sort of assessing now how we can replicate what they're doing because we would also like to be predominantly in an outpatient setting as we get through the clinical phase I dose escalation.
That, that's been very helpful. Again, it uses the same format that we're using for 819. That's used with plamotamab. It's a partner program. We get mid to high single-digit royalties on plamotamab. And, you know, as with the T-cell engagers and heme malignancy, there was always an initial concern that if you hit them with steroids too hard, is that going to somehow dull the anti-tumor activity? Not the case, right? And we found that over and over again. So now confirmed with that, which is great. And, listen, the anti-tumor activity of plamotamab, 40% response rate, and patients post-taxane median four lines of prior therapy. That's impressive. And the clinical community is very excited about that.
Got it. Let's switch to another 2+1 program. So, XmAb808. This is your B7-H3 x CD28. What makes B7-H3 a good target to pursue? And how does going after this with a 2+1 CD28 bispecific compare to the other programs in development?
Yeah. So 808 is the first of our CD28 bispecifics. CD28 is a target on T-cells that is called the driver of signal two. So the signal that turns T-cells on that you engage with CD3 or when the T-cell receptor naturally binds is called signal one that primes the pump and gets a cell going. Signal two sustains it, proliferates the cells, and really creates a more durable anti-tumor response and a broader anti-tumor response. So CD28 engagement offers the opportunity to do that. You need to pick a target to do that that is nicely expressed on tumor cells but also has nice lower expression on healthy cells. So B7-H3 is a really good candidate for use with a CD28. It's expressed on many different kinds of tumor cells.
It's a homologue of the B7s, right? So it has some kind of immune function, presumably, and it gets upregulated on lots and lots of different tumor types. And it only has a pretty low expression in healthy tissue, predominantly in reproductive tissues that are not necessary for sustaining life. There is expression in other organs as well, but at a much lower level, no neural expression is known, no central nervous expression is known, which is important. So that sets it apart from some of the earlier targets that have been tried with CD28 co-engagement, like PSMA, which do have expression in CNS tissue, which can cause liabilities, in addition to just the general immune-related adverse events you get when you do something as powerful as turn on T-cells with signal two.
So, the goal of a signal two driver, like a CD28 bispecific, is to amplify the immune responses from signal one. So you're talking about something designed to be in combination with CD3 or bispecifics or with checkpoint inhibitors. And so you want to have something that can address a lot of tumor types so you don't have to make a new CD28 for every single combination partner, right? You want to have something that you can use in multiple tumor types with a checkpoint inhibitor like a PD-1 or with multiple CD3s, sort of a Swiss Army knife target. So B7-H3 fits that bill as well. So nice expression difference, healthy to tumor tissue, broad expression on different tumors so you can combine it multiply.
Then we did a big empirical exercise building the molecule using the 2+1 format, to get just the right stoichiometry and drive of CD28. The last thing I'll say on the mechanism is we purposely dialed the activity and potency down on our CD28 bispecific. The binding domain has a relatively low affinity and lower potency for driving CD28 activation. The 2+1 format gives us, you know, a stoichiometry on the tumor cell that doesn't engage too many copies of CD28 because it's a powerful mechanism when you want to control it. I think the biggest challenge so far that's been seen in the clinic with CD28 bispecifics is too much activity and toxicity. So hopefully, we hit the mark and we're exploring that now in phase I.
Well, in the phase I, what's nice about it is B7-H3 is obviously very relevant in prostate cancer. And so in the phase I, even though we're dose escalating with pembrolizumab, it will be clear to us that there's activity. You know, if we get to that the activity level that's exciting there, it's going to obviously be driven by 808.
Got it. Maybe just describe the phase I study and what are the timelines associated with that?
Sure. So we're about one year in dose escalation now, going very, very well. The investigator is, again, excited about trying to push through as fast as possible. The design is there's a 4-week lead-in of 808 monotherapy and then pembrolizumab on top of that. We're, you know, hopeful that we'll get to the active target dose levels by year-end and kind of same timeline as 808 and 819 have a decision point on that study, hopefully in the first half of 2025.
Got it. I think you addressed my next question. So maybe before we move on to my other topics, let me just check to see if there are any questions from the audience. And if not, then maybe Dane might want to consider taking over at this point. Do you have any questions for Bassil? All right. Switching over to your dual checkpoint inhibitor, vudalimab. This is your PD-1 by CTLA-4 . Maybe just first discuss the opportunity for this program.
Yeah. So we built this molecule with a design using our bispecific XmAb bispecific platform as the scaffold to engage T-cells that hopefully only the T-cells that express both the PD-1 and CTLA-4 target. We built it with a single copy of a binding domain to PD-1 that has moderate affinity and then a single copy of a binding domain to CTLA-4, which has modest affinity. And so the goal there being to have CTLA-4 engagement only when you're also engaging PD-1, which means you have to have both targets on the cell, or the theory is that that more restricted engagement would focus on the cells that do have both targets, which are the ones in the tumor microenvironment that have had these checkpoints upregulated.
So we wanted a more restrictive activation, to avoid as many of the toxicities of using CTLA-4 blockers chronically and, you know, that have been amply characterized with ipilimumab experience in combining ipilimumab with PD-1 inhibitors. So we wanted to do that so we could get more of that CTLA-4 function for longer and hopefully improve activity in tumor types that are resistant to PD-1 therapy alone, and to hopefully increase activity in tumors that do have sensitivity to PD-1. So that's the theory. The biochemistry of the molecule plays out beautifully. We, we've now completed phase I. We've zeroed in on our dose range, which is significantly higher than you can get with PD-1, CTLA-4 blockade alone.
You know, the molecules, rather than block CTLA-4, as monospecific antibodies, do not, you can't get to the kind of equivalent doses that we reach, which are in the 10 mg per kg or roughly gram-level doses. So that theory seems to have played out now. It's about how we are going to use this molecule to find a place in a very, very challenging, crowded area of checkpoint inhibitor therapy. So we've got our program going now in prostate cancer, a couple of very clear experiments that we just showed some initial data on, part of last month. Then we've got a new start of a frontline lung cancer study. All of our prior work had been done in late-line cancer patients, whether it's in prostate cancer or RCC or what have you.
Our work now in lung cancer is in frontline therapy in combination with standard of care chemo to go after PD-1 therapy alone as a potential way to be superior to that. So that's the overview of the program right now.
Got it. And can you maybe just touch on the highlights of the recently disclosed phase II monotherapy data in prostate cancer?
Sure. Yeah. That's from our phase II monotherapy study in late-line prostate. Dane, you want to give a highlight to that?
Yeah, sure. So the phase II monotherapy cohort in prostate cancer is interesting. So it was actually a cohort in a gynecologic study that's different than actually the study that's exploring vudalimab plus docetaxel currently. That cohort in that study read out a data cut towards the end of last year that we used to discuss with the investigators around ASCO-GU in January. And I think, too, quite honestly, a lot of surprise within the investigators that were working with us, there's a real clinical signal there. It there's a 25% confirmed RECIST response rate, a little higher than that unconfirmed. 25% patients had PSA 90s.
This study is a little different than the other ones that have been run where all the patients were required to have measurable disease at baseline, meaning that they would have liver-lung lymph node mets, meaning that they were, you know, as advanced as you could possibly enroll in a clinical study. Seeing the clinical benefit for these patients, we were encouraged internally, but the investigators unanimously said, "Listen, enroll, kind of get to a 30-patient cohort so we can really see what the signal is here, and then we can figure out what to do next." What next could be, there's a lot of different options there. You know, we're watching how Pluvicto moves into the pre-taxane setting.
We're watching how some of the studies that have come out in the last six months suggest that Pluvicto may sensitize the tumor microenvironment to immunotherapy, where vudalimab obviously would be a very strong IO agent to use. The tox profile is definitely orthogonal to that. But, you know, there's room for potential monotherapy development in the post-TKI setting as well. So we're evaluating all those options and keeping an open mind as we enroll probably the next 16 patients into the study. And, again, you know, not to be a broken record here, but we'll have a clinical decision point in the first half of 2025 is our current expectation.
Got it. And the grade 5 event of autoimmune hepatitis, how should we be thinking about that?
Yeah. That was discussed at around the ad board as well. So that case was there. The investigator who had the grade five immune-mediated hepatitis event in that monotherapy cohort went through the case. It's an unfortunate case. We reviewed the rate of hepatic events across the studies at relevant doses of vudalimab. And collectively, we have a quite robust safety database of close to 240 patients at this point. And the overall rate of hepatic AEs is equivalent, if not lower, than the actual stringent rate of immune-mediated hepatitis that you see with Opdivo used in indications such as renal cell carcinoma. So, it's unfortunate that that event happened, obviously, when you have as advanced patients as we're treating in this monotherapy cohort. You know, it's investigator discretion of how you treat them.
And that patient did respond to therapy, which is great. But they had a number of other immune-related emergent adverse events prior to that. So we're remaining vigilant. We've had a discussion with investigators, and I think, you know, everyone's aware of that event. And we'll be, you know, making sure we don't have that happen again.
Got it. Got it. Maybe just in our last minute, how are you thinking about business development opportunities for the company? Obviously, you know, in the past, Xencor has had a lot of success and has been a big part of the company's history. How are you thinking about that moving forward?
I think right now we're focusing on our internal pipeline and, you know, don't consider in the near term business development necessary to drive those assets together. Vudalimab, XmAb819, XmAb808, XmAb541, which we're about to start in the clinic, Claudin 6 x CD3. We think we need to generate the data we're set to do right now and build value in these assets and make these clinical decisions. I think when we look at those three programs currently enrolling, perhaps vudalimab, if it gets to the point where the data merits really significant investment across a range of indications, if we show potential in frontline lung, for example, that would be something where we would definitely consider how BD could play a role.
Then we're always looking to use our technologies with partners when we wouldn't do it ourselves. I think our infectious disease collaborations with Vir and GSK is a great example of that. So that's always kind of in the background.
Got it. I think right on time. That's all the time we have. Thank you.