Analyst Conference Summary



conference date: May 9, 2023 @ 5:30 AM Pacific Time
for quarter ending: March 31, 2023 (Q1, first quarter 2023)

Forward-looking statements

Overview: Strong botensilimab data in colorectal cancer.

Basic data (GAAP):

Revenue was $23 million, 18% down sequentially from $28 million and down 12% from $26 million year-earlier. But royalty revenue from QS-21 increased y/y.

Net income was negative $71 million, up sequentially from negative $74 million, and down from negative $51 million year-earlier.

Earnings per share, diluted, (EPS) were negative $0.22, down sequentially from negative $0.24 and down from negative $0.19 year-earlier.



Conference Highlights:

CEO Garo Armen stated: "With over 350 patients dosed with botensilimab in our Phase 1 study, we have demonstrated 20-50% response rates in 9 solid tumor cancers and the ability to transform cancer treatments. These results suggest that botensilimab could provide significant benefit to patients who have not responded to or failed other available treatments." Botensilimab has shown strong results in both cold and hot refractory and difficult to treat cancers. Believes can continue to generate non-dilutive cash from partnerships, including for botensilimab. Plans Phase 3 studies in colorectal, melanoma, and pancreatic cancers. Could make regulatory submission for approval in 2024. Another data update will come as ASCO in early June.

On May 1, 2023 Agenus, a majority holder of its spin-off MiNK Therapeutics (INKT) distributed a dividend of 5 million shares to Agenus shareholders.

Next-Gen CTLA-4 agent, botensilimab (AGEN1181) reported updated data at ASCO-GI January 2023. Most recent Phase 2 MSS CRC botensilimab/balstilimab combination data showed 12-month overall survival rate of 63%, including 81% for patients with no active liver metastases, and 40% for patients with active liver metastases, indicating clinical benefit across all patient populations. That compared with standard of care 12-month overall survival rate of approximately 25%, inclusive of patients with and without active liver metastases. OR (overall response) was 23% (compares to 2% for standard of care. Phase 2 updated Ovarian cancer botensilimab/balstilimab combination showed overall response rate of 33% and disease control rate of 63%, much better than comparators; a Phase 3 trial should start in 2023. Sarcoma data showed 46% overall response rate. R/R NSCLC data showed a 50% overall response rate and 75% disease control rate. All trials will coninue, with melanoma and pancreatic cancer Phase 2 trials expectd to complete enrollment in 2023. Had initiated Phase 2 trials for advanced refractory MSS colorectal cancer and for melanoma patients who failed prior PD1 and/or CTLA4 therapy in Q3 2022. A trial in pancreatic cancer began in December 2022. Botensilimab is designed to delete T-regs and increase priming. It also overcomes the genetic polymorphism displayed by about 40% of the target cancers (which makes Yervoy unresponsive). Both monotherapy and combination therapy were well-tolerated. The combination is also showing potential for the adjuvant setting.

The FDA granted Fast Track status to botensilimab/balstilimab combination for the treatment of non-MSI-H/deficient mismatch repair (dMMR) metastatic colorectal cancer patients without active liver involvement who are resistant or intolerant to fluoropyrimidine, oxaliplatin, or irinotecan, and have also received a VEGF inhibitor, an EGFR inhibitor, and/or a BRAF inhibitor. Currently in Phase 2, with a global Phase 3 trial in this patient population is expected to begin in 2023.

The first patient was dosed with AGEN 1571 in July 2022, alone and then combined with botensilimab and/or balstilimab, in solid cancers. It is an ILT2 inhibitor that targets tumor associated macrophages, which promote resistance to PD-1 and CTLA-4 therapy. Preclinical data was presented at AACR 2022 in April. Another Phase 1 study is planned.

The combination study of AGEN2373 (CD137 agonist) and botensilimab in melanoma patients who have relapsed or are refractory to PD1 therapy continues to enroll. Monotherapy results for Phase 1 will be presented on June 3, 2023. Data from the combination portion of the study will be presented later in 2023.

AGEN2373, a CD137 agonist, partnered with Gilead, is enrolling a Phase 1b sudty in R/R melanoma, combined with botensilimab. Received a $5 million milestone from Gilead in 2022.

In Q3 2022 Bristol Myers launched a Phase I/II study of BMS-986442 (a TIGIT bispecific discovered by Agenus, was AGEN1777) in combination with nivolumab or chemotherapy in patients with advanced solid tumors and non-small cell lung cancer.

In Q3 2022 Merck initiated a Phase II study of MK-4830 (a candidate ILT4 antagonist discovered by Agenus) in combination with pembrolizumab and chemotherapy in ovarian cancer; additional Phase II studies are ongoing in NSCLC, small cell lung cancer, esophageal cancer, MSI-H colorectal cancer, renal cell carcinoma, and melanoma.

Bali/Zali combination will continue to be developed for possible use in ex-US territories.

Incyte therapies licensed from Agenus continue to advance in the clinic, except one. Three Incyte partnered programs will have presentations at ASCO 2023.

Shingrix is the most effective shingles vaccine; GSK commercial sales have exceeded projections. Agenus licensed GSK QS-21 Stimulon, a component of Shingrix. It is also a component of GSK's Mosquirix vaccine, against malaria, which has received regulatory approval in Africa. SaponiQx subsidiary was launched to provide SQ-21 and next-generation agents, collaborating with Phyton Biotech and Ginkgo Bioworks. Will use a plant-cell based technology. SQ-21 Stimulon is also a component of the GSK RSV vaccine that was approved by the FDA in May 2023.

Revenue consisted of $3 million R&D; $19 million non-cash royalty (QS-21); $1 million other.

Cost of sales was $0 million. Research and development expense was $57 million. General and administrative expense was $18 million. Cost of service revenue $2 million. Other income $1 million. Non-cash interest expense of $17 million. Fair value adjustment $0.4 million.

Cash and equivalents balance ended at $189 million, down sequentially from $193 million. $na million cash used in operations. No debt. Raised $13.6 million in Q2 with at-market sales.

Q&A selective summary:

Expectations for 2373 at ASCO? Very important product, complementary to other treatments, including botensilimab. Focus is on memory component of immune system, increases durablity of responses. This is a next-gen CD137 that should be less toxic than the first generation.

New Phase 2 or 3 studies in 2023? No public announcements of other Phase 2 trials. But stay tuned.

NSCLC randomized trial? This is a hot cancer. Botensilimab can target both hot and cold cancers. In PD1 resistant cancers we are showing about a 50% response rate. Expanding the cohort in hopes will see the same response rate. Some interest shown by outside groups in multiple-arm, earlier stage combo Phase 3 trial starting sometime this year.

The patients we are treating are typically fourth line or later. Very sick. The kinds of responses we have seen are very meaningful for patients this sick. We believe responses will translate to longer-term benefits.

Sample size needed in Phase 3? The number does not need to be that high if th 50% response rate holds up, in this patient category.

Gilead opt-in timing? Question is will interests converge, we don't know their perspective. 2373 is important to Agenus, it is a matter of negotiation, may have some announcement in 2023.

First gen CTLA-4 will not distract from botensilimab, but continues in trials.

Agenus web site

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Disclaimer: My analyst call summaries may include both our condensations of statements made by company representatives and my own analysis. They are not covered by any warranty. I cannot guarantee anything said by company representatives is true. I try not to make errors, but it is possible. This is journalism, not investment advice.

Copyright 2023 William P. Meyers