Affimed N.V. (NASDAQ:AFMD) Q1 2024 Earnings Call Transcript - InvestingChannel

Affimed N.V. (NASDAQ:AFMD) Q1 2024 Earnings Call Transcript

Affimed N.V. (NASDAQ:AFMD) Q1 2024 Earnings Call Transcript June 12, 2024

Affimed N.V. beats earnings expectations. Reported EPS is $-1.38, expectations were $-1.73.

Operator: Good day, everyone and welcome to Affimed’s First Quarter 2024 Earnings and Corporate Update Call. At this time all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will be given at that time. As a reminder, today’s conference call is being recorded. I would now like to introduce your host for today’s call, Alex Fudukidis, Head of Investor Relations at Affimed. Please go ahead.

Alexander Fudukidis: Thank you, Michelle, and thank you all for joining us today for our first quarter 2024 update call. Before we begin, I’d like to remind everyone that we issued the relevant press release and presentation on our website today, which you can find under the — in the Investor Relations section. On the call today, we have members of our management team, including Andreas Harstrick, our Chief Medical Officer and Acting Chief Executive Officer; Wolfgang Fischer, our Chief Operating Officer; Denise Mueller, our Chief Business Officer; and Harry Welten, our Consulting Chief Financial Officer. Our financials today will be presented by our Vice President of Finance, Michael Wolf. The team will be available for Q&A after the prepared remarks.

Before we start, I would like to remind you that today’s presentation contains projections and forward-looking statements regarding future events. These statements represent our beliefs and assumptions only as of the date of this call. Except as required by law, we assume no obligation to update these forward-looking statements publicly or to update the reasons why actual results could differ materially from those anticipated in the future and the forward-looking statements, even if new information becomes available in the future. These forward-looking statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in these statements due to various factors, including, but not limited to, those identified under the section entitled Risk Factors in our filings with the SEC, and those identified under the section entitled Forward-Looking Statements in the press release that we issued today and filed with the SEC.

With that, I’ll turn the call over to Andreas. Andreas?

Andreas Harstrick: Yeah, thank you Alex and good day everyone and thank you for joining us today for our first quarter of 2024 earnings call. I’m excited to share with you today clinical data on all three of our clinical programs that, as we believe, are validating our approach of using the innate immune system as an additional tool to fight cancer. When we announced this strategic reorganization of Affimed and our focus on the advancement of our clinical assets in January, we guided that our goal would be to generate meaningful data for all three programs in the first half of the year. I’m proud to say and thankful to all of my coworkers in Affimed and to all our clinical investigators that today we can deliver on this guidance.

As shown on Slide 3, we now have clinical validation for all three assets. For AFM24, we are advancing the combination study with atezolizumab in treatment refractory patients with non-small cell lung cancer. Both in the EGFR wild type and in the EGFR mutant subgroups. Data that we shared at ASCO demonstrate durable responses in patients with EGFR wild type tumors with three or four responses ongoing now for over seven months. We also see meaningful and confirmed tumor responses in the EGFR mutant subgroup. It’s a type that is generally considered unresponsive to immunotherapy. We can also share exciting data for our clinical LuminICE trial of Acimtamig in combination with AlloNK cells in patients with refractory Hodgkin’s Lymphoma. Seven patients have had their CT scans, meanwhile assessed by blinded independent REIT which will be the primary endpoint of the study as agreed upon with FDA.

In these patients, we see objective responses in six out of seven patients for an overall response rate of 85.7%. Importantly, this includes four patients with a complete remission. Finally, AFM28, our CD123 targeting ICE for the treatment of refractory AML has shown remarkable clinical activity. A dose level 5 of our single-agent dose escalation study, we have observed one complete response in five patients with stable disease. At dose level 6, we see two patients with a complete response in the CRI respectively, and three patients with stable disease. Importantly, the complete response from dose level 5 is now ongoing and stable for more than five months. And five of the six patients at dose level 6 are continuing on treatment with a possibility for further deepening of their responses.

Also importantly, no dose-limiting toxicities were observed in dose level 5 and 6, thereby establishing a safe and effective regimen for further development. Let us look at the data in some more detail. Today, I will start with Acimtamig. As a reminder, on Slide 5, you see the trial design as agreed upon with FDA. We now have completed enrollments into Cohorts 1 and 2 and are actively recruiting Cohorts 3 and 4. We admit that there is still a slight delay in recruitment compared to our initial expectations as discussed on our last earnings call. This is mainly due to a higher rate of patient drop out during the screening period. However, with additional sites now active and more experience with a protocol at the site level, we expect to see further improvement in patient recruitment and a reduction in the dropout rate.

In terms of safety, shown on Slide 6, the adverse event profile is in line with our previous experience with Acimtamig and the combination of Acimtamig and AlloNK cells, respectively. It is important to note that in the LuminICE-203 study, we did not use steroids as part of premedication [ph] for Acimtamig and therefore, we were expecting a slightly higher rate of infusion-related reactions compared to some studies with Acimtamig in which steroid premedication was routinely used. Four of seven patients developed a grade 1 or 2 infusion-related reaction/CRS event. One of these four patients had a short-lasting Grade 3 CRS as assessed by the investigator, which manifested mainly by high fever and a decrease in blood pressure. However, the patient responded readily to standard of care treatment.

Importantly, in this patient, shortly after this event, there was also acute CMV infection diagnosed and thus, the relative contribution of the infusion of the Acimtamig versus acute CMV infection to the overall symptoms is not clear. Importantly, there were no treatment discontinuations due to side effects of the Acimtamig or AlloNK. Also, there were no instances of bleeding, icons or graft-versus-host disease. As the clinical activity of the combination is, I think, remarkable, as shown on Slide 7, six of seven patients showed an objective response by independent REIT including four patients with a complete remission. These data are directly comparable with the data that were reported by MD Anderson Cancer Center for Acimtamig in combination with fresh pre complexed NK cells and thus indicate that co-administration of an ICE with allogeneic NK cells is active, that no precomplexing is needed, and that cryopreserved NK cells seem to be comparable to fresh NK cells in terms of antitumor activity.

Also, these results demonstrate that data from the single site study at MD Anderson are reproducible in a multicenter setting as these seven patients were enrolled by four different institutions. Slide 8 shows the patient’s characteristics underscoring that these patients are heavily pretreated, with a median of four lines of previous therapy. All patients had failed combination chemotherapy, PD-1 targeting therapy, and brentuximab. In addition, five of seven patients had also failed after autologous stem cell transplant. On Slide 9, you see an example of a patient with multiple manifestations of his refractory Hodgkin’s Lymphoma including axillary lymph nodes, supraclavicular lymph nodes, spleen and inguinal lymph nodes. The patient had failed all standard of care options, including stem cell transplant and presented with B symptoms, which clinically is a very unfavorable prognostic factor.

As you can see, all tumor manifestations resolved after only one cycle of therapy. Let’s move on to AFM24. Since we presented the data in detail during our ASCO presentation, I will be brief here. As shown on Slide 11, the combination of AFM24 and atezolizumab has meaningful activity in patients with heavily pretreated EGFR wild type non-small cell lung cancer. In 15 evaluable patients, there were four objective responses and eight patients with stable disease. Of note, all patients had failed combination chemotherapy and PD-1 targeting therapy. All responders were documented progressive on previous anti-PD-1 treatment. Importantly, the responses and the tumor control induced by AFM24 atezolizumab appear to be curable as shown on Slide 12, where you see the long-term follow-up data.

The progression-free survival for the whole study population is 5.9 months, which compares favorable to the 4.5 months, which is usually achieved in these patients with standard of care treatment. Even more encouraging is the fact that three of the four remissions are still ongoing now at more than seven, more than eight, and more than nine months, respectively. It appears very unlikely that these data can be explained by atezolizumab activity alone. Even though there are occasional responses to PD-1 rechallenge after intervening chemotherapy, PFS data in these patients has been very short. Even in PD-1 no pretreated patients in platinum refractory non-small cell lung cancer atezolizumab has shown a progression-free survival interval of only 2.8 months.

A technician in the preclinical development working on innate cell engager.

Our recent results in patients with heavily pretreated EGFR mutant non-small cell lung cancer, as shown on Slide 13, supports the activity of the AFM24 atezolizumab combination. In 13 patients that are response evaluable, four responses and six patients with stable disease were achieved. Compared to the data that we reported at ASCO, meanwhile, all objective responses have been confirmed by follow-up scans and all responses are ongoing. This is remarkable as EGFR-mutant non-small cell lung cancer is, in general, regarded as unresponsive to immunotherapy. Slide 14 shows the market opportunity for drugs that are targeting refractory non-small cell lung cancer. In the seven major markets, there are 175,000 patients with EGFR wild type non-small cell lung cancer and roughly 35,000 patients with EGFR mutant non-small cell lung cancer annually who fail standard of care therapy and will need additional treatment options.

Current treatment options for these patients are unsatisfactory with PFS durations around 4 to 4.5 months. Also, many salvage regimens include chemotherapy that is often difficult to tolerate for these heavily pretreated patients. The combination of AFM24 plus PD-1 could provide a chemotherapy-free alternative with meaningful activity and significantly better tolerability for these patients. Finally, let’s review the most recent data of AFM28. Our CD123 targeting ICE for the treatment of acute myeloid leukemia, as shown on Slide 16. Here, we have escalated the dose through six cohorts up to 300 milligrams weekly. I think this study is also a good example of the ability of our organization to execute clinical studies. The first patient in this program was treated in March 2023 and the whole dose escalation trial over six cohorts was executed in only 15 months.

The safety profile is shown on Slide 16. For dose levels 5 and 6, we did not see any dose-limiting toxicities. The most frequent side effects were infusion-related reactions, mainly of low grade. Only three patients had a Grade 2 infusion-related reaction, responding in all cases to symptomatic treatment, and there were no Grade 3 or higher IRRs. One patient experienced a short limiting — lasting self-limiting CRS of Grade 1. Infections are characteristic manifestations of acute leukemia and were seen in half of the patients. However, none of the infections was considered treatment related by the investigators. In addition, we observed meaningful target interaction at doses of 200 milligrams and above, with nearly a complete saturation of CD123 binding sites on the tumors and occupation levels of CD16A on the NK cells that include preclinical experiments result in potent NK-cell activation.

The clinical activities displayed on Slide 17, in dose level 5, we saw one complete response in five patients with stable disease, all patients were heavily pretreated. Of note, the complete remission is still ongoing after more than five months. In dose level 6, we saw two patients with a complete response into CRI respectively, and three patients with stable disease. Five patients from dose level 6 remain on treatment with additional cycles and thus, the option to deepen their responses. I think these results are remarkable. Most of these patients with advanced AML have very low numbers of own NK cells when they start treatment. So it appears that AML could be very sensitive to NK cell mediated killing if already low numbers of endogenous NK cells when directed to the leukemia cells by AFM28 can produce complete responses.

These data taken together with the impressive activities that we have seen with a combination of a Acimtamig and allogeneic NK cells in Hodgkin’s lymphoma support our strategic intent to pursue further development of AFM28 in association with a cryopreserved allogeneic and case of products. With this, I would again address an area of significant unmet medical need. In the seven major markets, we see over 14,000 patients per year who failed at least two lines of standard therapy and require a new treatment option. Many of these patients are elderly and show frequent comorbidities, thus limiting the use of aggressive chemotherapy. Immunotherapy has not been successful so far in AML. The treatment approach based on the activation of the innate immune system could therefore be an important additional strategy for the treatment of these patients.

With this, I will close the overview of our clinical programs and hand over to Michael Wolf for a review of our financial data. Michael, please?

Michael Wolf: Thank you, Andreas. Balance sheet and income statement highlights are shown on Slide 20 and 21 of the presentation. A quick reminder that Affimed’s consolidated financial statements has been prepared in accordance with IFRS as issued by the International Accounting Standard Board, or IASB. The consolidated financial statements are prepared in euros. Since our financials are described in detail in the press release we issued this morning, I will only provide highlights on this call. We ended the first club with cash, cash equivalents, and investments €48.5 million compared to €72 million on December 31, 2023. Based on our current operating and financing plan, we anticipate that our liquidity will support operations into the second half of 2025.

Net cash used in operating activities for the quarter ended March 31, 2024 was €23.8 million compared to €33.2 million for the quarter ended March 31, 2023. Total revenue for the quarter ended March 31, 2024, was €0.2 million compared with €4.5 million for the quarter ended March 31, 2023. Net loss for the quarter ended March 31, 2024, was €19.2 million compared with a net loss of €32 million for the quarter ended March 31, 2023. Now I’ll turn the call back to Andreas for final remarks. Andreas?

Andreas Harstrick: Yes. Thank you, Michael. For our concluding remarks, let’s go to Slide 22. I think this has been a very exciting and very successful quarter for Affimed in which we were able to obtain clinical validation of all three of our programs. I think the strongest conclusion that we draw from this data today is consistency. When you see a single data set in one study in one particular disease setting, of course, you may always think could this be a chance finding. But what we are demonstrating today is consistent activity signals across three different programs that are all designed to leverage the power of the innate immune system to fight cancer. We see this in four different indications and with two different combinations.

Initial results from our Acimtamig and AlloNK program show remarkable activity, which seems to be on par with the data reported by MD Anderson. The difference is that we were able to generate this data with co-administration of the ICE and the NK cells and with cryopreserved off-the-shelf NK cells. Both factors that enable the use of this approach in a real-world multicenter setting. For AML, we see that AFM28 can induce responses even in a setting where only very few NK cells are available to fight leukemia. I think it is very reasonable to expect a boost in activity of sufficient amounts of active allogeneic NK cells are added as we have shown in our LuminICE study. Therefore, we are actively exploring ways to continue the AFM28 program in combination with off-the-shelf allogeneic NK cells.

And last but not least, we see consistent activity for the combination of AFM24 and atezolizumab. The strategy that utilizes the crosstalk between the adaptive and the innate immune system. When we started this program, I assume there were a lot of doubts whether innate immune system could even attack solid tumors, given the largely immunosuppressive environment that is found in many solid tumors. Meanwhile, we have demonstrated objective and durable responses in heavily pretreated EGFR wild type non-small cell lung cancer patients with the longest response now ongoing for 10 months in patients with prior documented progression on PD-1 targeting therapy. This data is supported by the observation of objective and confirmed responses in patients with heavily pretreated EGFR-mutant non-small cell lung cancer.

The disease that historically has not been sensitive to immune mediated treatments. Of note, we see these results with a regimen that does not include any chemotherapy and thus may be better tolerated in this heavily pretreated patient population. I think the totality of the data reported today support our strong belief that the innate immune system can be utilized to fight multiple types of hematological and solid tumors, and that Affimed’s propriety ICE molecules can provide the necessary targeting and activation. As guided, we will have additional important data readouts in the course of the year. Affimed with its portfolio of several potent NK-cell engagers, and with its experienced and highly motivated clinical development organization is well suited to advance the use of the innate immune system as an additional treatment option for patients in need.

We will continue our path to advance these exciting programs and thereby bring value to our organization, our patients, and our shareholders. With this, I thank you all for your attention. And I’m happy to take questions. Operator, please?

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