Molecular Partners H1 2023 Earnings Call Transcript

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Provided by Quartr
August 25, 2023

There are 8 speakers on the call.

Operator

Good day, and welcome to the Molecular Partners First Half twenty twenty three Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. Thank you. Seth Lewis, Senior Vice President, Investor Relations, you may begin your conference.

Speaker 1

Thanks, Rob. Good morning, everybody, and good afternoon to our friends in Europe. My name is Seth Lewis, Senior Vice President, Investor Relations. And I'm joined on the call this morning by Robert Hendricks, Senior Vice President of Finance and Patrick Amstutz, Chief Executive Officer. Management will be making a few prepared remarks and then we'll open up for questions.

Speaker 1

A set of slides is available on our website, molecularpartners.com, Under the Investors Presentations tab, we'll refer to the slides as we go through today's presentation. Please note management Turning to Slide 3. With today's call, Patrick will take us through the highlights of the first half, along with a few updates subsequent to the quarters. Robert will provide an overview of our financial results and then Patrick can provide a bit more information into the programs and outlook for 2023 beyond, And then we'll take your questions. Before I hand over to Patrick, I just want to take a minute and highlight my enthusiasm for where the company is at this moment in time.

Speaker 1

Many of you who have followed us know the last year 2022 started on such a high note with the success of InsovaVet and then Thankfully, the pandemic waned, but so did the potential for near term revenues and procurement of government stockpiles for INsoBAVET, and we all saw how that Has affected all of us. Now that's a trade off that we are glad to make. But back then, we told you that we were well financed to move forward in the rest of the programs and Everything was on track and strong from an internal perspective. And today is really the One of those days where we're going to start to show you that that is so true. Since then, we're able to show positive data since MPO-three seventeen at ASCO.

Speaker 1

533 is now in the clinics, and it's making its way through dose escalation and entering a phase where we can see a real opportunity to help patients. And I'm just personally very proud of the team and all we've accomplished in this past year, and I wanted to highlight that before we started. But with that said, let me pass it over to Patrick for an overview of the first half.

Speaker 2

Thanks, Seth, and thanks also for the overview that I'm totally backing up. And I'm now on Slide number And I will just kick off with setting the stage just for those who are new to the story, what are DARPAINS And what is our strategy? So DARPAINT stands for designed, like when repeat proteins. These are Somewhat bridging the gap between small molecules and antibodies or large molecules. They're a tense the size of an Bobby, and we really use that either for the small size in our radios, dark and therapy approach or we use the small size To create multi specific, Line 533 or 317 that I will be talking about.

Speaker 2

We have been doing this a while, and so we have also 7 clinical stage compounds, of which 6 have shown results, and each of them really did exactly what it was Meant to do so, we have also a lot of clinical validation on not only the scaffold, but also the modes of action And our ability to predict that. Now to the strategy. So how do we apply our approach? The first and foremost is we are focusing on the unique DARTIN solution. So we solve problems and I will talk about the problem That other engineering approaches with other small molecules antibodies will struggle to do so.

Speaker 2

So it's all about the dark and uniqueness, meaning if we want to have a solution that has to be meaningful and it also is very difficult to be copied by others. The meaningfulness is the next part. So we're aiming for true patient value and true means for us a big delta over current standard of care, A high medical need. You will see some of these patients are really that line and have no other hopes than our drugs. Early clinical readout, very important.

Speaker 2

We as a small biotech, we don't have the funds to run huge head We have trials to find out if we are marginally better than another compound. So we invest in Finding drugs that in their Phase 1, Phase early 20, 30 patients really show themselves. And that is really also very much the hope then for 533, our AML drug. And we don't do that alone. We do partner with the world class partners and we use the partnership open.

Speaker 2

This can be an academic, it can be a biotech or it also can be a large pharmaceutical company. Let's move to Slide number 5 and just quickly look at what have we achieved in the last year, what are Highlights of the first half of twenty twenty three. 533 is on top for a reason. It is the key asset where we see most value being built. It's a Tetra specific or tri specific T cell engager, so it has 4 specificities.

Speaker 2

We started early in the year with the 1st patient dosed. We have 7 sites open in Europe and we are now in dose level 4. I will talk about that and that's really where exactly we wanted to be. So great now entering the zone where we expect activity. 317 says alluded to our ASCO abstracts, where we could show biological proof of mechanism, we show a favorable safety profile in mode of CD40 agonists where others, so far we're struggling to find that.

Speaker 2

And we are in a class of next Generation TD40s is absolutely exciting to see how we can use that biology to support other checkpoint approaches. Radiadarkins, that is sort of our research focus of the last year. We have made great progress in reducing kidney accumulation. Will talk about why that is important. We have selected PLL as our first official target.

Speaker 2

We have more in the making. And obviously, also And our Novartis collaboration deserves to note that it's progressing well. On the operational side, I would like to take a moment to also you will have seen that to thank Nicolas Leupin, our Chief Medical Officer, Ku is stepping down for the last 4 years of work. This is a personal decision, so it is not linked To what we are doing, he wanted to take a time out and I support that also as a personal friend that he does this And I'm very grateful for what he did, and I'm as grateful that he recruited Philippe Lejens, who is now stepping in seamlessly as Philip has set up and run the clinical trials that we will be talking about and he has an impressive track record Going back to J and J, GSK Novartis with a focus in oncology, with a focus in the U. S, also important for us, EU, And he joined us 2, 3 years ago from Amgen, where he was, the therapeutic area oncologyhematology in Europe.

Speaker 2

So thanks to both and great to have a team that can seamlessly take over in such A moment. Last but not least, and Robert will talk about this on the coming slides, I do want to point out our strong cash position. We have $218,000,000 in cash and that brings us and redefine towards well into 2026. With this, it is my pleasure to hand over to Robert, and I will then take the word back just to give you a bit deeper dive into our pipeline.

Speaker 3

Thank you, Patrick. We're on Slide 6 at the moment. I'd like to briefly run you through the financial highlights and the key figures of the last 6 months. My name is Robert Henriks, and I'm the VP of Finance at NPE here. The numbers you see are stated in CHF 1,000,000 and more details On the website.

Speaker 3

And then moving on to Slide 7. When we are looking at the financial highlights for the past half I'd like to focus your attention to 3 bullets here in particular. As already indicated by Patrick, Our cash position, you may recall that last year we ended just under $250,000,000 We're now at 2 So that's a cash burn of $32,000,000 which is well in line with our expectations. We had no additional cash coming in from collaborations in 2023. Secondly, I'd like to focus on the updated guidance for the full year.

Speaker 3

We are guiding now That our operating expenses are ending up in the $65,000,000 to $75,000,000 window, and this is down from The previous window of 70 to 80. The reduction is largely based on the actual numbers that we see after the 6 months and the current expectation of the development of the cost and of course also of the workforce. In line with the past, we will not guide on revenue. And to be clear again, this guidance is subject to the progress and changes in our pipeline. Thirdly, also already mentioned briefly by Patrick on the runway, we feel that we are now funded well into 2026, and that's a slight change from the into 26 we had put out earlier, again excluding any potential payments from partnerships.

Speaker 3

And we feel that this runway puts us in a very privileged position in the industry as such. I think that these three bullets combined are important to note as they reflect the solid financial state of the company. If I then move on to Slide 8, where we see the comparison with last year, the 6 months period. Again, focusing on a few numbers. Firstly, if we look at the revenue number, clearly, the $3,500,000 To this period as compared to the $185,000,000 last year, you may recall that the $22,000,000 number was largely driven by payments That we received from Novartis from our COVID compounds.

Speaker 3

And there was That is clearly not recurring into 2023. The $3,500,000 this year relates entirely to the collaboration with Novartis On Radialgiant Therapies, the number has both an element of re Charge FTE as well as a recognition of revenue from the upfront of $20,000,000 that we received in late 2021. As per today, we still have around $7,000,000 on the books that will turn into revenue in 2023 and 2024. Secondly, on this page, the operating expenses, you see that they are down for the comparable period. A number of elements are driving this, but just to highlight a few.

Speaker 3

Early 2022, we did invest largely in the drug substance and the drug product For MPO-five thirty three that is currently in the clinic, with this cost not recurring, we did clearly invest also more in our research, our basic research and the radio ligand pipeline, but overall R and D expense is still seeing a reduction year on year. An additional reason for the reduction would also cover the smaller cost we incurred in 2023 for MPO-three ten. It is the compound that we developed together with Amgen and that is currently no longer progressing. And on the SG and A side, element of higher costs we no longer see in 2023 are the professional fees that we did incur in 20 20 2, for the implementation of SOX. We started that before our market cap Took a dive in first half of last year.

Speaker 3

What we also see again on the SG and A side is the benefit already a bit in the first half, but definitely As an element in the full year guidance that we have a fairly strongly reduced number of D and O insurance, the market there Picked up and we were able to get a very significant saving. As a general remark, we are and remain diligent and careful when looking at our We do feel that we are cost effective and we run a tight ship and that remains on course to deliver on the promises. Thirdly and lastly, a quick view at our FTE number. You see a slight increase year on year To the current of 169, and at the end of last year, we were at 175, so again, it's last year end of last year a small reduction. Combined again, we think that these numbers showed a strong financial base entering into the second half of twenty twenty three At the end of the call in the Q and A session.

Speaker 3

And with that, I hand back to Patrick to tell you more about the R and D programs and the scientific outlook Patrick, back to you.

Speaker 2

Hey, thanks, Robert, and thanks also for all the great work you and your team put in to put all of this together. And I'll just echo, we're really cost effective, as you see, moving forward and keeping the budget well under control. I'm now on Slide 9, where I want to start with the R and D update. Moving to Slide number 10, where you see the Pipeline chart, you see on the top our clinical 2 program, 3,17533 that I will talk about. We have immune cell engagers.

Speaker 2

I will touch on the outlook on those, and then we'll also highlight the radiotherapy therapy Let's move to 317, the most advanced asset. Just quickly going back to my intro, what Is the problem, what is the problem statement there? And the point here is that CD40 is an agonist cells, antigen presenting cells, including B cells, and rytic cells, macrophages. If you now activate CD40 on a systemic level and you see a human that is glowing red, That leads to what we would call accelerated systemic immunity. I was taught by our translational group that's the best way to phrase it, Systemic, call it, effect, in this case, turning into side effect.

Speaker 2

At the same time, these cells activation of these cells Again, tissue or in this case, hopefully the tumor. So what we try to do is use FAP as a localizer And activators, so it's not only localizing it, but also the clustering, the local cluster of SAP To bring CD40 together, activate T cells have no systemic exaggerated immunity of a lot Of local immunity building. We added the next slide, and please, this is in no means Exhaustive, it should more highlight how this field of CD40 where many companies see value in this pathway Has evolved over time. Has evolved from full antibodies showing side effects being stopped, Moving to 2 SCs where the jury is still out. 2, I call it the bispecifics or multi specifics Where we, it's us, Roche and Genmab BioNTech that are pioneering that space.

Speaker 2

And what we can now add to this table from where we sit It's the SAP CD40, and we can talk about presently explored doses of 10 milligrams per kilogram, So far so good. And we also, at this dose, have so far seen no exaggerated systemic immunity. So from where we sit, We think this is definitely a valid approach to unlock the CD4D activity. On the next slide, I'm now on Slide 14, this is a stated Update, so I'll quickly focus on the chart. We're now in the last cohort.

Speaker 2

It's not the highest, but it's the highest per week. So it's that I'm jumping now to the ASCO results. We presented there the highest dose, but that was every 3 weeks. On safety, we have a favorable safety profile there. One DLT that was not confirmed, so we could not confirm back that, that was a real Stopping off the trial at that dose and we would have to go one down.

Speaker 2

So far, the highest doses hold and we are now Finishing the trials or the enrollment, we'll look at all the data to then decide at what dose or what dosing regimen would we suggest Moving forward would happen in a combination. So we are definitely reaching out to interested parties to run combination trials as CD4 4 gs alone can kick start the immune system, but it does not it's not enough just to dose this drug Just one slide we added here sort of seeing is believing and I like this one here where you have Biopsy prior treatment and post treatment, on the left hand side, you see gaining for CD40, CB11C, which is for dendritic cells, SAP for the localizer and then the dark pin. And you see obviously prior to staining, there's less It means the dendritic cells and molarpin. After dosing, this is in cycle 2, day 8, You see the dark pit is now there. It colocalizes with SAP.

Speaker 2

That's what you would expect as it binds to SAP. It activates Let's move to another molecule. This is 533, and you will note one difference in 3 17. 3 17 is of the Older generation, there we still need the combination trial. 533 is the new generation of the new strategy, and here we do expect Simulation activity.

Speaker 2

What problem are we solving? AML is not a debt owed, a debt you believe it is also complex, And it's complicated because of 2 or 3 different things. First, there's different cells with different targets. There is not one clean target like a CD premium B cells, but you actually have different targets that or expressed on AML cells. And when I speak about AML cells, these are blast and In our view, leukemic stem cells, but these targets are also shown on healthy cells to a lesser degree And especially also likely mono expressing.

Speaker 2

This is all summarized on Slide 17. So there is A way to discriminate, but you need a molecule that can discriminate mono expressing cells from multi or co expressing cells off So that's what we set out to do. We created binders to CD33, CD70, CD123, Linked them to our T cell engager and actually we're proud that this is the 1st non antibody T cell engager in the clinics now and has life extended with HSA. In the final combination, we have to screen 8,000, in our case, more than 8,000 combination to find those molecules which would do this discrimination. On Slide 19, We have depicted on the right hand side this Venn diagram, again showing it.

Speaker 2

You have the triple expressing cell in the middle. That's in this case a cell line. We did knock out the individuals first alone and then the duplets to quasi reconstruct From an AML cell line, the situation we expect to see in a patient. We then added 533 on the left hand And you see how the line is shifted from the left to the right. So we are next killing the mono expressing and also the plateau is Lower down, so we also don't kill all the cells because the expression level is simply then too low even at high doses of that respective target.

Speaker 2

And that's how we want to open a therapeutic window on targets that have We started this trial early this year, and we're really proud and big thanks to the team for the good progress. It is not an easy Disease, you will know that. So also running trials can be difficult. And we, with our very close And you see dose level 4 is already a bit darker blue, but the next dose levels are really the ones where we expect This molecule to be active and we expect first signs starting in dose level 4. So big thanks to my team for doing it, but also For the sites and the KOLs that are really enthusiastic in pushing this trial forward.

Speaker 2

And this will be the key readout in the second half of this year. Moving now to the Radiodarkine platform. Slide 20 22 here shows you sort of the promise and the first problem. What you see on the left hand side is a Prostate cancer patient PSMA positive treated with PSMA targeting actinium Product and you see within a few cycles, you move to the right side and this patient is cancer 3. At the same time, you see one first problem, which is the kidney that larger molecules and protein drugs We'll bring the radio ligand to the or we'll bring the radioisotope, I should say, to the kidney and also destroy the kidney.

Speaker 2

This is not true for small ligands, moving to Slide 23, so the RLTs. At the same time, these RLTs, The ligands are restricted to targets where you have a good cavity and you can make a good high affinity binder, but that limits your target range. So what we're trying to do is bring the broad target range, high affinity of DARPA that is proven into this class, but Also reducing the kidney accumulation. Our team has worked very hard and we are we're able to present data At different conferences, moving to Slide 24. And you see, 1st, we did a Stealth DARPAIN, that's the DARPAO checkered line, 80% reduction in this case by reengineering the surface of this monotherapy.

Speaker 2

We added an orthogonal method on top and that again added 61% reduction. So we're at 14 As you can see on the tumor side, it did not affect the tumor and that's where we will be focusing next. By slightly engineering half life and linker, we believe we can bring up the tumor to interesting levels to reach the Tumor to kidney of 1 to 1, which is the basis you would need to move a molecule To candidate stage and towards the clinic. So we're very much approaching that, now focusing on increased tumor uptake. I want to mention on Slide 25, our great partners Novartis, leader in this field And that's about the deal than the collaboration.

Speaker 2

So we're joining forces with them very much exchanging ideas, results And learning from them, they are learning from us and they have 2 tumor antigens that are exclusive and we keep all others, including DLL3, which is the one we are moving forward, or it's most advanced in our pipeline. So before turning to the outlook and your questions, let me quickly summarize and actually Excited to see initial results. So not only dosing, but also what does the molecule do. And again, we do expect single agent activity. And with that, we would obviously expand the trials in Europe, but also then to the U.

Speaker 2

S. We have 317, here we guide towards FITC when we want to show more data from the higher dose cohorts, and we do believe that The higher doses do help for more activation and we are engaging with partners for combination trials and at the same time, We are very much looking forward to our competitors, Roche, mainly hopefully to present some data on their SAP CD40. On the Radiosarctin side, I was pointing out before that it is all about now tumor accumulation to bring the tumor higher up to reach the 1 on 1. We are evaluating more targets that we then can put into that pipeline. And once we want to move forward, we will also need partnerships With the Radian applied, and there we are discussing and you should also watch out for collaboration agreements With isotope providers in this space.

Speaker 2

We will also start to talk about the next generation And Before kind of thanking and opening for questions, let me reiterate what Robert said. So we're running a tight ship. We have 2 $80,000,000 in cash were funded well into $26,000,000 so all of the above is well into our cash runway. Let me And obviously, also the investigator insights in the clinical trials and most importantly, all the patients in our trials. With that, I would thank you for your attention and for dialing in and your support of what we're doing and open for questions.

Speaker 2

Thank you.

Operator

And our first question today comes from the line of Dana Graybosch from Leerink Partners. Your line is open.

Speaker 4

Hi. Two questions for me, both on well, one on the TETRA specific and then one on CD40. So on the TETRA specific, you say that you think that dose level 4 is when you start to hit efficacious doses. Can you talk through why specifically the rationale for that dose level 4? And if you are seeing PK and PD biomarkers In the clinic that are supportive of your preclinical modeling?

Speaker 4

And then the second question is about CD40. We recently We saw a deal here with Pyxis acquiring Apexogen. And I wonder if you had any thoughts on the valuation of that deal and how your molecule Compares to Apexogen CD40. Thank you.

Speaker 2

Good. I will definitely I can take the first. So why dose level I mean, and that's a great question. And we have quite some understanding on the modeling, which we do in preclinical stage. We have a group that is expert in that.

Speaker 2

They advise on which dose levels we have to take and maybe I'll start there. As we did not Have cross reactivity to SYNO or actually other species, we really had to go for a MABEL dosing. So the first doses are so low that we don't It's even difficult to measure a PK trait at the level your quasi led to a lower level of detection. So this is and we didn't change any of the coloring. So these are really the predicted activities.

Speaker 2

Now obviously, there is The clinical signs you follow and you will want some CRS, but not too much. And we are also measuring all the cells. We are measuring the cell counts. And in this case, unfortunately, it's also survival as these patients are very ill and will also progress very fast On this in this disease. So with that together, I think we can easily get a good understanding, is the drug doing something or not?

Speaker 2

And obviously, blast count and then also regrowth or leukemic stem cells, MRD negativity are things we'll be following. Obviously, not for me to comment today, but we will definitely guide and then show an update in the time we get around cash. On the CD40 epexogen deal, I find that difficult to judge. So I mean, that's in the eyes of others. Apexigen definitely had nice early data that then maybe was a bit less impressive going forward, but it's always to find the right application for the If Amy says there are others who want to comment on that, on the deal, please go forward.

Speaker 2

I would not feel in That's for hours so far showing that, that really opens the therapeutic window and that's the full biological effect Possibly between now. Laffette, if you want to comment, you are always close to the deals and competitors, maybe you have an angle on it.

Speaker 1

Yes. Obviously, as you said before in the slides, perhaps There are what we consider that 2nd generation with the FC tuned and clearly from a localization activation perspective, we just Design the molecule differently. And I think they're at a time and place, at least in immuno oncology that we all are, where Single agent activity is preferred. And while they have shown in their data, I think certainly some limited activity in that regard, We know that folks are looking for a little bit more when it comes to the data and people this isn't 2019, 2018, whatever And people are handing out checks for a second molecule for their IO, IO franchise. So from our perspective, having the funding in place and having the ability to further Amongst the class, as Patrick referred to, of sort of this next generation with Roche and even the Genentech or Genmab, Beyond Tech at Molecule, I think we have a bit of patience and flexibility that maybe they didn't.

Speaker 1

And I guess that's I would just comment in that regards to the valuation question.

Speaker 4

One quick clarification of the answer to the first one. So how many of the doses are sort of Maval doses where you really

Speaker 2

So I'll refer to the slide deck where you see, and I mean this is sort of the way we depict We are not in a position to give dose levels, but obviously the first two are very low. That's why we're also just dosing 1 to 3 patients. So Don't expect anything from there. Then those level 3 is maybe the first where you want to have a bit more patience. So I think out of those level 3, You expect to action Sea Drop.

Speaker 2

And now with those level 4, we're entering the zone where we would also start to expect activity.

Operator

And your next question comes from the line of Richard Vosser From JPMorgan, your line is open.

Speaker 5

Hi, thanks for taking my question. Just a follow-up on 523, probably on That dose level 3 then or maybe the lower doses. Can you say anything about the side effect profile at this point in terms of What you've seen, how clean it is, you mentioned you want to see not too much CRS, but some. Any color you can give there would be useful. And then just on 3,017 in terms of partnership discussions, would you look to co fund those?

Speaker 5

It sounds like You need more data first from this weekly cohort, but after that, would you do another trial where you Provide drug and co fund or how should we think about the partnership?

Speaker 2

Thanks, Richard, for both But at this point in time, we're not commenting. What I can say is that those escalation was seamless. We see where we are. This is really great execution. We have many also investors asking us, are you not a bit aggressive starting early year and then wanting to Show results because end of the year with the stage you are in and there is our confidence and also the Strong support of the sites really, that's the thing we can add at this point in time.

Speaker 2

3/17, also great question. I think there it's Where we are today, we're in the 3rd generation, the only ones that have really shown data. And I do think also we would rather profit And kind of being set back by good data by our competitors in the 3rd generation. We will not fund massively into additional trials for 317, at one point in time, as I said before, this will be a combination play with another IO drop That is not in our pipeline. It's not there, and we're not acquiring 1.

Speaker 2

So this will be more strategic for a partner. I think it's really about sort of how do we facilitate to get the data of those combinations that you say. It could be A combination trial that we could co fund, we could maybe run some safety work to support that. So those are the thoughts. It will not become a major investment, but maybe we'll invest in 1 or the other safety trial because the combination I hope that helps.

Speaker 2

These are a bit open questions that at this point in time, we'll have to also answer in an open way.

Speaker 5

No, sure. That's fine. Thank you.

Speaker 1

Maybe from my perspective, I can just add. Yes, that's one thought. I think it's a great question, Richard. I think it's important To pull out the fact here that this if you ask anybody within our company, 317, this is a drug. This is working as designed.

Speaker 1

This is doing what we expected it to. It's performing mechanistically as we've asked of it. And we're There are other programs historically within MP throughout our history where maybe it wasn't the right patient population or maybe it wasn't The right molecule needed because there were other things that were out there at the time that would otherwise be utilized. And I think with this one, we're being exceptionally thoughtful about how to make sure this program finds its way forward appropriately, Because the activity we've seen here is exactly what we would have hoped for it and the enthusiasm and the productivity around this program is hot. So I think While we're a bit reserved in what our public thinking is at the moment, I can only reiterate that the enthusiasm and the expectations for this program are high.

Speaker 2

Thanks, Seth.

Operator

And your next question comes from the line of Michael Nadelkovich From TD Cowen, your line is open.

Speaker 6

Hi, thanks for the question. Patrick, first one on 533, When we see the data at the end of the year, can you help us set expectations? What would get you excited When the data are released about future development of the compounds and would it be efficacy, safety, what should we focus on when we see the data? And then the second question is, when we think about 533, your radio DARPN platform and your Switch DARPN platform, Looking ahead, let's say, 2 years, what do you anticipate will be the major focus of the company and the avenue into which you put Most of your R and D resources.

Speaker 2

Yes, thanks. Obviously, also a very good question. Thanks, Michael. Let's just guide first a bit for 533 and you have to and it's good that we're here for end of August and Ash In a clinical trial, timing is just around the corner. So we will not be able to give a lot of data points there, but we definitely will be able Talk about safety at relevant doses, as you pointed out.

Speaker 2

Are we seeing some CRS, but not too much? Then also on the efficacy, do we have responses or not? And we need to see some responses. How that could look? I mean, we'll definitely follow the blast.

Speaker 2

We will follow how the patients are doing, and we will only be able to see the first part Of those responses, obviously, just given the time, so no durability, no how long the response would hold, Things like that, we will not have and we will maybe be able in those range 5 with data and then 6, 7 to come. So it will be an early data, Managing a big expectation, at the same time, we can see responses, and that's nothing we had with 317. So It's really right in between. I do think it's important that we can show responses then. That's where we are today.

Speaker 2

This will then create sort of the basis for shorter planning to exactly what you were asking, how will then the investment split look like because you invest in a molecule Today, we're very positive about 533. We are we also like Like we don't like the outcomes in AML, but we have some follow-up ideas in that space. So if 533 looks good, I'll branch to your second question. We can also work on additional generations of AML drugs and that's Then based on switch concepts and the like. So if I33 looks good, you go fast forward a few years, it could be that we have 2, 3, 4 Molecules from also a switch platform in AML.

Speaker 2

That's a scenario that is possible and Obviously, RLT has been a bit different. That's and this would be a The Holy Grail of the 1 to 1 or even better makes that broadly available to targets. So given we will To all of that, the question will be what targets and in what settings. That will be one of our focus areas. Can we also work on target Identification validation for this space, so that's something I would hope to have in a few years, much more clarity, plus the collaboration to secure the ISO So if you want to do that, until you will be if both work out just on these two settings, there you will have an AML franchise and an ROT franchise That are different, but both are groundbreaking, solving key problems that you today have in the clinics.

Speaker 2

Thank you. I hope that answered a bit how the thinking, how the outlook can evolve from

Operator

Your next question comes from the line of Laura Fazer from Octavian. Your line is open.

Speaker 7

Yes, hello. Good afternoon. Just maybe following up on the questions on 533, I'm wondering here at what time point we can expect a go, no go decision from your side and also what is needed for a go. And then maybe related to that, I'm also wondering how much R and D budget you need to bring MP533 to the next value inflection points? And how in general we should think about your R and D progression over the next 1 to 2 years?

Speaker 7

Thanks.

Speaker 2

Yes. No, thanks for the question. So let's put it like that. I think in the next 6 months, we can go, let's call it, no go continue. So we will not have the data to double down and start to think about a pivotal Phase Q3.

Speaker 2

But what we will see is, Do we have effect do we have to understand patient characteristics? Are there subgroups? Are there difficult to treat subgroups where we are effective And really form our thinking about what the next steps of development is. And here the team is already Full force on. So they're looking at all of this.

Speaker 2

We're preparing all scenarios and the corresponding next trials that you would want. Obviously, this is nothing I can put out today, but you can guess we are well prepared. To run the trial from where we sit today To go, I think that's where we were guiding with including the bit of the expansion cohort there. I think that's those 20 to 45 and hopefully it will be more than 45 patients. But with 45 patients, we should be in a good position to Also then reached the goal answer, that's the next year.

Speaker 2

And this is really where we then could define how the next steps look. But that we would have a drop that this is valuable to go forward. That's early next year. It's the earliest, I guess. The costs you were asking, so this is not massively expensive.

Speaker 2

This is well within the budget that Robert was talking about. We're always running these trials. In the box, this is all in what we're doing. Where we would add obviously cost is if we start a Phase twothree trial, But that's based on good data.

Speaker 7

Okay. Thank you.

Operator

And this ends our question and answer session. Mr. Patrick Amster, I turn the call back over to you for some final closing remarks.

Speaker 2

Yes, thanks. First of all, thanks again to my team, everyone involved. Also thanks for all the great questions. I love that we are now focusing on the To have possible outcomes and outlooks, I mean, this is great. To sort of close the circle to Seth, the last year was all about execution, was To get into the position to now collect the data to have those forward looking discussions, I think I'm personally glad we have progressed so well.

Speaker 2

At this point in time, you can say that was a year of steady constant progress, but in our field, if you reach that, it means you have no setback. And that is everything but normal in our field. So big thanks to my team, but also very happy to be where we are. Looking forward to the next 6 months and beyond. And with that, I would like to close the call and thank you all for your attention and fasten

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Key Takeaways

  • MP0533 tetra-specific T-cell engager for AML has dosed its first patient across seven European sites and entered dose level 4, where preclinical modeling anticipates initial efficacy signals in H2 2023.
  • MP0317 CD40 agonist demonstrated biological proof of mechanism and a favorable safety profile at escalating weekly doses, and is positioned for combination trials to enhance its immune activation without systemic toxicity.
  • The radioligand therapy DARPin platform achieved an 80% reduction in kidney accumulation through protein surface engineering and orthogonal modifications, advancing toward a 1:1 tumor-to-kidney uptake ratio needed for clinical development.
  • Molecular Partners reported a strong cash balance of $218 million at June 30, 2023, revised FY 2023 operating expense guidance to $65–75 million, and anticipates funding into 2026 without relying on additional partnership payments.
  • H1 2023 revenue fell to $3.5 million from $185 million a year earlier following the non-recurrence of COVID-related milestone payments from Novartis.
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Earnings Conference Call
Molecular Partners H1 2023
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