Affimed N.V. (NASDAQ:AFMD) Q3 2024 Earnings Call Transcript

Affimed N.V. (NASDAQ:AFMD) Q3 2024 Earnings Call Transcript November 14, 2024

Affimed N.V. beats earnings expectations. Reported EPS is $-1.03, expectations were $-1.14.

Operator: Good day, everyone. And welcome to Affimed’s Third Quarter 2024 Earnings and Corporate Update Call. At this time, all participants are in a listen-only mode. [Operator Instructions] 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.

Alex Fudukidis: Thank you, Lisa. And thank you all for joining us today for our third quarter 2024 update call. Before we begin, I’d like to remind everyone that we posted the relevant press release and presentation we’ll be using today on the Investor Relations section of the website. On the call today, we have members of our management team, including Shawn Leland, our Chief Executive Officer; Andreas Harstrick, our Chief Medical 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 VP 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 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 Shawn. Shawn?

Shawn Leland: Thank you, everyone. Thank you for joining us today. I’ve been with the company for a couple of months now. And during this time, I’ve had the chance to immerse myself in the incredible work that is being done at Affimed. I am genuinely impressed by both the groundbreaking science and the clinical milestones our team has achieved over the last 12 months. The depth of expertise within our organization and the potential of our platform are truly remarkable. And they have only deepened my confidence in the work that is being done at the company. The main reason I decided to join Affimed was the data demonstrating clinical proof of concept across three different assets spanning solid tumors and hematologic malignancies.

Our therapies shown activity in both model therapy and combination studies. All of our innate cell engagers are moving well beyond clinical proof of concept, which is having an impact on how we shape and focus the company for the future. Affimed’s innovation is bringing meaningful benefits to patients who have often exhausted all other therapeutic options and indications where there are significant unmet medical needs. In addition to the promising activities shown with our innate cell engagers, both as model therapy and in combination, they have also demonstrated a favorable and differentiated safety profile, even in these challenging and heavily pre-treated patient populations, many of whom are in the end stage of their disease. The fact that we continue to observe meaningful and often durable responses gives us immense confidence.

These results are what excite me the most about our platform and therapies, which offer hope where little has existed before. I’d like to highlight the differentiated safety profile of our NK cell engagers, which enables us to target molecules with the narrow therapeutic index due to their tumor specificity. NK cells naturally distinguish between tumor and healthy tissue. So when targeting CD123, for instance, our engager binds to normal tissue, but does not trigger NK cell killing due to inhibitory factors in healthy cells. This leads to a safer profile and improved therapeutic index for our CD123 engager, AFM28, compared to TCEs, ADCs, and CAR-T, which have toxicities that are often unmanageable and sometimes fatal. Although, we observe some toxicity with AFM28, these events are fewer and manageable.

This tumor specificity is also seen with AFM24, our EGFR engager, which avoids the scan of mucosal toxicities associated with other EGFR targeting approaches, further underscores unique safety advantages of our NK cell engagers. Today’s call will be brief, as our key clinical updates will be shared in December. At the upcoming ASH 2024 conference, we are excited to have an oral presentation on AFM28, as well as preclinical data at a poster session. Data from our LuminICE-203 trial will also be presented at a poster session. Clearly, this recognition is based on the strength of our data. This is not only exciting; it is validating that our innate cell engagers may have a key role in the future paradigm. On December 17th, we will host a company conference call to provide a clinical update on AFM24.

I’d like to take a moment now to reflect on what we have been doing since we last spoke. Since joining, I’ve hit the ground running, speaking with members of the financial community, potential partners, KOLs, and many of our clinical investigators to gain their perspectives on the value they see in our therapies and how they would like to see us continue their development. I am taking this feedback very seriously and used it to further refine our strategy and our focus. We will maintain our focus on clinical development priorities. Our decisions about our programs will be based on clinical benchmarks, the competitive landscape, and the commercial potential. Our goal going forward will be to deliver therapies that not only demonstrate strong clinical efficacy, but also have a meaningful impact on the treatment paradigm and are commercially sustainable.

In addition, we understand that partnerships will play a pivotal role in accelerating our progress. Drawing on my extensive background in business development, we are pursuing a wider range of potential collaborations. Broadening our thinking on the types of collaborations will allow us to engage with a more diverse set of potential partners and further expand our strategic options. Affimed today is a more streamlined and focused organization. As we take our company into the future, I’m committed to delivering differentiated clinical data from our ongoing trials and ensuring steady, measurable progress across our program. I reiterate my commitment to improving the financial health of our company, and we are actively working as a small financial position.

My number one objective is to ensure that our company is well capitalized to deliver on the expectations we have heard from the financial community and our investigators in order for us to continue to further the clinical development of our programs and ensure the long-term success of our company. This will enable us to evolve the company such that we not only develop innovative therapies, but we operate in a way that maximizes value for all stakeholders. That includes our investors, our partners, and most importantly, the patients who depend upon us. With that, I’ll pass the call to Andreas to give you an update on our clinical trial progress.

Andreas Harstrick : Yes, thank you, Shawn, and welcome to everybody on the line. As Shawn mentioned, our clinical update today will be brief with significant updates to come at the F2024 meeting in December. These presentations include data from our hematological trials namely LuminICE-203, it’s a combination trial with Acimtamig and AlloNK cells in refractory Hodgkin lymphoma, and for AFM28, our CD123 targeting ICE for acute myeloid leukemia. As mentioned for our EGFR targeting ICE AFM24, we will have a dedicated conference call to discuss the progress in the non-small cell lung cancer EGFR wild type cohort on December 17th. That said, we have made important strides across our clinical programs this quarter, and I’d like to briefly highlight where we stand today.

Let’s start with our AFM24-102 trial, as shown on slide 4, in which we are evaluating AFM24 in combination with atezolizumab in non-small cell lung cancer patients who have exhausted standard of care options. Both the EGFR wild-type and the EGFR mutant cohorts are now fully enrolled, and we are actively treating and monitoring patients. As a reminder, we previously reported data for 17 patients from the wild-type cohort at ASCO 2024. Four confirmed objective responses were seen, one complete response and three partial responses. In addition, eight patients achieved stable disease, resulting in a disease control rate of 71%. Median progression-free survival at that time was 5.9 months, with a median follow-up of 7.4 months. Importantly, at the time of data cut, three or four responses were ongoing for more than seven months, and all responding patients had a documented progression while receiving checkpoint inhibitor treatment before, which supports the hypothesis that combining AFM24 with atezolizumab may provide an alternative strategy to overcome resistance to existing therapies.

For the AFM24 non-small cell lung cancer EGFR mutant cohort, we presented early efficacy data on our Q2 earnings call, with also four objective responses seen in the initial 17 patients. We anticipate to report the final response and safety data from the non-small cell lung cancer EGFR wild-type cohort on our December 17 company conference call. Final PFS data from the EGFR wild-type and overall response and PFS data from the EGFR mutant cohorts are expected to be presented at a major scientific conference in the first half of 2025. We believe that the data of AFM24 in combination with a PD-1 targeting checkpoint inhibitor, while early, demonstrate promising activity in treatment-refractory non-small cell lung cancer patients. Potentially offering a chemotherapy-free alternative for these patients who have failed multiple lines of treatment, a notable advantage given the difficulties these patients have in tolerating additional chemotherapy.

And moving to our Acimtamig program, as shown on slide 6, in the LuminICE study where we are combining AlloNK and CD30 targeting our ICE Acimtamig, we are progressing this study for patients with multi-refractory Hodgkin’s lymphoma. We announced that clinical data from the four cohorts of LuminICE, which are all fully recruited now, will be presented at ASH 2024. Finally, we also announced that our AFM28 program, targeting CD123 for Relapsed Refractory AML, will be featured in an oral presentation at ASH. The ongoing phase 1 trial of AFM28 monotherapy has escalated dosing through six cohorts, reaching 300 mg weekly. No dose-limiting toxicities have been observed at this dose level. Based on the promising monotherapy results reported during our Q2 earnings call, we have further expanded cohort 6 and added additional six patients to confirm the observed monotherapy signal.

The ASH 2024 presentation will feature updated data from this study. With that, I’ll conclude our clinical program update and now hand it over to Michael Wolf for a review of our financials. Michael, please.

Michael Wolf : Thank you, Andreas. Balance sheet and income statement highlights are shown on slides 10 and 11 of the presentation. A quick reminder that Affimed’s consolidated financial statements have 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 third quarter with cash, cash equivalents and investment of €24.1 million compared to €72 million on December 31, 2023. Based on our current operating and budget assumptions, we anticipate that our cash and cash equivalents and investments, together with anticipated proceeds from the ATM program and the sale of AbCheck, will finance its operations into Q4 of 2025.

Net cash used in operating activities for the quarter ended September 30, 2024, was €11.1 million compared to €18.3 million for the quarter ended September 30, 2023. Total revenue for the quarter ended September 30, 2024, was €0.2 million compared with €2.0 million for the quarter ended September 30, 2023. R&D expenses for the quarter ended September 30, 2024, were €10.1 million compared to €21.5 million in 2023. General and administrative expenses for the quarter ended September 30, 2024, were €4.3 million compared to €5.4 million for the quarter ended September 30, 2023. Net loss for the quarter ended September 30, 2024, was €15.1 million, or €0.94 loss per common share compared with a net loss of €24.4 million, or €1.63 loss per common share, for the quarter ended September 30, 2023.

Now I turn the call back to Shawn for final remarks. Shawn?

Shawn Leland: Thank you, Michael. In the couple of months since I joined Affimed, I’ve been deeply impressed by the dedication of our team and the meaningful progress we are making. Our therapies are treating patients who have exhausted other options, and we remain committed to advancing innovative treatments that address urgent unmet needs. Looking ahead, we will focus on advancing our key clinical programs, broadening partnerships and maintaining financial stability. We believe these efforts will maximize the impact of our science and create value for all stakeholders. Despite the challenging market environment, I’m confident in our ability to chart the right course forward and secure the capital needed to support our progress.

I want to extend my sincere gratitude to our investors for your continued support, to the patients and families who place their trust in us, and to our dedicated employees who drive our mission. Together, we will keep pushing forward to deliver life-changing therapies to those who need them most. Thank you for your attention, and we are happy to take any questions. Operator?

Q&A Session

Operator: [Operator Instructions] Our first question for the day comes from Li Watsek of Cantor.

Li Watsek: Hey, great. Thanks, guys, for taking our questions. Maybe just on AFM28 in terms of the data update at ASH, how much durability should we expect? And then in terms of the patients where you rolled into the study, can you comment on the mutational status and prior treatment?

Shawn Leland: Hey Li, thanks for your question. Andreas, do you want to respond to Li’s question?

Andreas Harstrick : Yes, so in terms of durability, obviously, we have six patients that we have reported at our last earnings call. These patients will have a meaningful observation period or follow-up period to really assess durability of responses. The additional six patients that we added were recruited more recently. And for most of these patients, some patients are still actively receiving treatment. For most of these additional six patients, the follow-up period may just be a little bit too short to have meaningful conclusions on duration of responses. In terms of pretreat months, 80% of our patients in this trial had been pretreated with a Hypomethylating agents and venetoclax, a little over 50%, 55% or so, had also pretreatment with an intracycline, mainly intracyc and RRC containing regimen.

And I believe roughly one-third of our patients had also received a stem set transplant. In terms of mutational status, if you look at negative mutations like RANK 1 or p53, roughly two-thirds of these patients have a negative molecular profile in terms of negative predicting mutations.

Li Watsek: Okay, great. And then you mentioned that maybe you guys can have a monotherapy path here. I’m just curious when would you be in a position to go to the FDA to discuss the registration path here and what will be the patient population you’ll be looking at, given we have other targeted agents approved here?

Shawn Leland: Yes, Lee, thanks for the follow-up question. Andreas, do you want to respond to Li’s follow-up question?

Andreas Harstrick : Yes, so I think what we announced is that, again, we will have additional patients on the 300 milligrams dose level. The protocol allows us to go even beyond the 12 patients we have now. We are also planning to add at least one higher-dose cohort to make sure that we are really capturing the full therapeutic potential in terms of deepness and response duration. Again, the safety profile is very safe, so we easily can offer the dose-escalate, and this will give us a data set that would enable us then to go to FDA a little bit depending on the maturation of the data. And what was your second question, Li?

Li Watsek: The patient population.

Andreas Harstrick : Oh, the patient population, yes. Again, this is a very well-tolerated drug. We have not encountered dose-limiting toxicities as the pharmacodynamically active doses, like 250, 300. Also, our phase 1 study has been open for all patients, so we have no age limitations or anything. Also, we expect to see patients, if we go down the monotherapy paths, that fulfill FDA requirements for a patient population of unmet medical need. So, depending on age and risk profile, the either should have received and have not responded to an anthracyclines RSC-containing regimen if there are younger, fitter patients, or to a hypomethylating agents plus Venetoclax regimen. If there are older patients, or patients who have a targetable mutation, like FLT3 or something, they should also have exhausted these specifically targeting therapies to be eligible and to comply with the definition of an unmet medical need population.

Operator: And our next question will be coming from the line of Daina Graybosch of Leerink Partners.

Daina Graybosch: Hi, thank you for the question. Two for me. First, Shawn, I think I heard you say that you are broadening your thinking on the type of collaboration. And I wonder if you could talk about what you mean. So, what type of collaboration was the company pursuing previously? And what does it mean to broaden that? And then I have a follow-up.

Shawn Leland: Yes, Daina, so thanks for the question. I mean, I think kind of given the financial position of the company, I mean, it makes sense to kind of evaluate all potential options that are on the table here. So, I mean, I think we’re looking at a variety of different strategic partnerships that could exist. These include potential regional deals, for example, I think in the past the company was more so focused on kind of a very finite set that was specifically looking at kind of multinational partners, so we’ve just broadened that strategy to create additional optionality to bring in additional non-dilutive capital that could come into the company. So that’s really essentially what we mean by kind of broadening the scope or lens on the BD partnering front. And that’s really driven by kind of leveraging kind of my past experience and relationships with companies on the business development front.

Daina Graybosch: Got it. Now, a very different question on AFM24. How are you thinking about potentially the development path going forward? Maybe similar to what Li just asked for AFM28, will you consider different combinations like chemotherapy, TKI, different PD-1s, and when might you make those decisions?

Shawn Leland: Yes, Daina, thanks for the additional follow-up question. Andreas, do you want to respond to Daina’s question?

Andreas Harstrick : Yes, sure. So I think the main difference between our hematological indications like treatment refractory Hodgkin’s lymphoma or treatment refractory AML. We believe that for a large indication like non-small cell lung cancer, it is very unlikely to achieve a regulatory approval with a single arm non-controlled trial. FDA historically have always insisted on randomized phase 3 trials. Now currently we are waiting to let’s see AFM24 atezolizumab or PD-1 data mature versus in terms of final response rate but also in terms of PFS. As you remember, we reported a median PFS of close to six months for our initial data set in the EGFR wild-type cohort which we believe is already quite differentiating from the four to maybe 4.5 months that you would see with standard of care.

And this will give us a couple of optionality we could consider to take the doublet into a registration trial against a standard arm, which most likely would be docetaxel. Also, given the very benign safety profile that we are seeing, and then we have patients now on trial and then continuously drug for more than 10 or more than 12 months, we can easily also develop triplet combinations where we could add either a VGF-inhibiting moiety like Rami serum up given the proven synergy between immune-modulating therapies and VGF inhibition, or we could add a drug like docetaxel to the doublet. And this would create data sets for an informed decision whether to take a doublet or a triplet into a registration directed trial.

Operator: And our next question will be coming from Srikripa Devarakonda of Truist.

Unidentified Analyst: Hello. This is Alex on Kripa. Also on AFM24. Can you remind us the data expectations for what type of data will be presented in December, like the number of patients and the durability, and then also on the development strategy? I believe that the company said that we’ll see a presentation of additional data in the first half of 2025. Do you think you’ll have enough data by then to make a go and no-go decision on the forward development of the program?

Shawn Leland: Hey, Alex. Thanks for the question on behalf of Kripa. Andreas, do you want to respond to Alex’s question?

Andreas Harstrick : Yes. So as we said at our earnings call, in December, 17th of December, the main focus will be on the EGFR wild-type cohorts. As you know here, we targeted roughly 40 patients. The cohort is fully enrolled. And what will be mature at that point will mainly be the response, the final response rate data. We expect seeing patients on trial that it will take probably another couple of months until we have final PFS data. So response and toxicity safety will be the main focus of our company event in December. As we said, major PFS data for the EGFR wild-type cohort may need more time to mature. The same is true for the response data in the EGFR mutant cohort. These patients were enrolled a little bit later, and we said we are targeting 25 patients here, and also PFS of the EGFR mutant cohort will need more time to really mature. These data are expected to be displayed at a major scientific conference during the first half of 2025.

Operator: Our next question will be coming from the line of Yanan Zhu with Wells Fargo.

Yanan Zhu: Hi, thanks for taking our questions. Just to follow up also on AFM24, have you submitted the abstract for the first half ‘25 Scientific Conference, and has it been accepted? Also wondering, in terms of the PFS data, how much longer the PFS needed to be compared with the 4.5 months or RAMY plus proceeds those seeds for the data to be considered as a strong set of data. And I have a follow-up.

Shawn Leland: Yes, and thanks for the initial questions. Andreas, you want to respond to his questions?

Andreas Harstrick : Yes, so let’s start with the last question. I’m not sure whether I got the first question fully. So what we have reported is 5.9 months median progression-free survival for the EGFR wild-type cohort. For the EGFR mutant cohort, we had not PFS data, but we also reported that out of the four responses that we had in the initial 17 patients, all four responses were on treatment for seven plus months, which already gives you an indication that it appears that responses that we are inducing can be very durable. Now, when you consider going into a phase 3 trial, one important point estimate always is immediate progression-free survival. Again, here we see probably a one and a half to two months difference, which is quite meaningful in these late line patients, but what also goes into your consideration is the shape of the curve.

So we know that chemotherapy usually basically drops down to zero in their progression-free survival because they are rarely long-term responders to chemotherapy. This is different for immune-modulating treatments where you usually see a tail or often see a tail of your PFS curve where a meaningful percentage of patients remains progression-free for a long period of times. And this will all go into your estimated hazard ratio, which basically will drive your approval. As I said, we want to let the data from the doublet cohort mature a little bit more. We believe that this may take until early, probably first quarter, 2025. And then we will be in a position to make an informed decision whether to take the doublet directly into registration-directed trial against, for example, docetaxel.

Now, the second question, as far as I recall, was whether we have submitted to the scientific conferences already. That would be a little bit too early. Most of the scientific conferences that we consider for the first half of 2025 have their abstract submission deadlines either late December or late January. This is the time when we’ll be submitting the data to be presented at the first half of 2025.

Yanan Zhu: Thank you, that’s super helpful. Yes, I was wondering also about the long tail phenomenon and whether that might be possible for the AFM24 plus that has a combo. Thanks for shedding some light on that. A quick follow-up for the Hodgkin’s lymphoma’s update. What data could we expect at ASH? Do you, or could we expect to see better response rate or CR rate in cohorts 3 and 4, given that they had a greater number of NK cells?

Shawn Leland: Yes, go ahead. No, it’s okay.

Andreas Harstrick : So at ASH, again, we have now fully recruited cohorts. The main focus will be on the initial response rate, given the fact that cohort 3 and 4 started enrollment only about like 2.5 months ago. And as patients can receive up to three cycles, many of these patients are still in active treatment. So it will be an early look at response rate, both overall response rate as well as complete response rate. Again, at this point, it’s hard to predict or speculate whether the increase in cell number may lead to an increase in efficacy. We have already seen, I would say, really groundbreaking or paradigm-changing data, meaning these Hodgkin Lymphoma patients who are treatment-refractory to chemotherapy, PD-1, and et cetera.

So what you would expect with any kind of standard of care is a 10%, maybe 15% response rate, and you basically never see complete responses. So 87% overall response rate, 50% complete response rate is already really paradigm-changing. Whether we can top something on this, the data needs to tell, and we have not seen the final data yet. This will be really freshly prepared for ASH to have the most updated data set.

Operator: And the next question will be coming from the line of Maury Raycroft of Jefferies.

Unidentified Analyst : Hi, this is Amin on for Murray. Thank you for taking our questions, two from us. First, on AFM24, you alluded to seeking a potential partnership for 24. Where do you currently stand in terms of partnership discussions, and what type of partnership do you have in mind? And are you thinking about full transfer of the drug or co-development? And I have a follow-up.

Shawn Leland: Yes, thanks for the question. Simon, I think as I responded to the initial question from Li, I believe like we are evaluating all kind of strategic options. So I mean, I think we’re evaluating multiple opportunities that could bring in potential non-dilutive capital to the company. So there’s not a specific type of partnership that we have in mind. We’re just evaluating kind of strategic options in the context of other options that could be pursued that would extend the cash runway for the company.

Unidentified Analyst : Great. And a follow-up on that, just given the current cash, what are your thoughts on future prioritization potentially between AFM13 and AFM28?

Shawn Leland: Yes. So I mean, I think at this time, right, we continue to develop all three programs, right, in parallel. I mean, I think as you look across the clinical data from all three programs it warrants continued development of all three of these programs. I mean, we’re showing compelling and differentiated data across all three of these programs that address significant unmet medical needs. So I mean, the prioritization at least at this time continues to remain on developing all three products in parallel.

Operator: Our next question will be coming from the line of Li Chen of HC Wainright.

Li Chen: Hello. This is Li in for RK. My question is centered on AFM28. Any thoughts on accelerating the development of the 28 program? Since we know that one other case NK cell engager has been advanced into phase 2 in frontline AML, is your goal development strategy for 28 to be in the frontline or in later line in combination with AlloNK cells.

Shawn Leland: Thanks for the question, Andreas, do you want to respond to Li’s question?

Andreas Harstrick : Yes, so as we said, I think it was previously, we do see a good monotherapy signal again with a relatively small number of patients. The first step now is to really consolidate this monotherapy signal, both in terms of response rate and duration of responses. Let’s say if you stay with a response rate of 50% and show meaningful duration of responses which in these refractory patients could be probably four months or longer, four to six months given the fact that the overall survival expectancy for these refractory patients often is only four months. This would give us an option to go an accelerated approval pass and this accelerated approval pass would be based on a single arm phase 2 study and by definition would have to be conducted in later lines.

So in patients with unmet medical need and are basically no treatment options available. We are aware of the other NK cell engager, this has just started phase 1, probably early phase 2 in combination with a Hypomethylating agents and venetoclax. This is a much longer pathway as you for sure would need a randomized phase 3 study which can be very expensive, could also be quite costly. So our preferred strategy would be to evaluate as least initially an accelerated approval strategy in later lines of AML.

Li Chen: Yes, thanks for the color, maybe a follow-up on that, so previously you mentioned and combining AFM28 with NK cell therapy, can you comment on the pros and cons of engineered RK and K cells versus current K-cells, which will be the preferred candidate that if you consider going after this combo strategy? Thank you.

Andreas Harstrick : Yes, so I mean from all the data that we have seen with a symptom in combination with allogeneic and K-cells, combining AFM28 with an allogeneic and K-cell product is a very logical choice. Again, here we seem to see even more single agent activity. Remember asymptomatic in Hodgkin Lymphoma only produces 15% responses. And still when you add the other NK cells, you end up in the 80% to 90% response range. We would expect to see a similar shift, a similar increase in activity, if we would add AlloNK cells and here we are looking at different options to pursue an NK cell-based program. I would not agree with the statements that CAR T and Ks are preferred over a combination of an ICE and a free or AlloNK product.

Engineered CAR T and Ks usually are much more difficult to produce often come associated with significantly higher CMC costs. What we have shown with the MD Anderson trial and what we seem to show now with our LuminICE trial is that we can be at least as active as an engineered CAR T and K with a combination which is easier to produce, probably much cheaper to produce, and we can also use the different components independently of each other. What we have shown in MD Anderson for example is that the effect is not only driven by the infused allogeneic NK cell but that of the ability to give free ICE like we do in LuminICE and like we have done in the MD Anderson trial also can recruit patients own NK cells. So you have a dual attack with patients own NK cells and transfused allogeneic NK cells, again something that you cannot do with a CAR T and K.

So I would turn the argument rather around and say if you can go with an ICE and a non-engineered easily and cheaply to produce AlloNK product that’s preferred over a much more complicated CAR T and K construct.

Operator: And our next question will be coming from the line of Yale Jen of Laidlaw & Company.

Yale Jen: Good morning and thanks for taking the question. Just trying to follow up with the previous one a little bit on the AFM28. The first one is that should you — should the next cohort also show robust activities and you mentioned that it will seek for a survey approval path, how should we think about overall the potentially over a study size for that and any colors on that potentially sort of pivotal study for a survey path. Then I have a follow up.

Shawn Leland: Hey, Yale. Thanks for the question. Andreas, do you want to speak to your question?

Andreas Harstrick : Yes, sure. I mean accelerated approval always will depend of course on your effect size given what we have seen so far and then again if this signal should hold up. We have some experience in discussions with FDA on our asymptomatic program where we also talked about accelerated approval. I would say what FDA usually wants to see an accelerated approval trial would be efficacy population somewhere between 80 and probably 100 patients. They do want to see some dose finding studies which we are already conducting to really be able to judge on the dose effect relationship and so I think that is a fair estimate of how a trial, an accelerated approval trial would have to look like.

Yale Jen: Okay, great. Maybe just one more question here which is if we compare AFM28 versus 13 where we see at least at this stage is AFM28 seems to have actually very robust results without adding additional NK cells. So were there any fundamental differences between 28 and 13 in terms of the drug itself or design itself? Maybe rendered 28 has sort of much more promising outcomes at this moment.

Shawn Leland: Thanks for the follow-up question, Yael. Andreas, maybe you want to answer Yael’s follow-up question?

Andreas Harstrick : Yes, that is a very difficult question. What we currently believe is that, honestly, the higher activity signal that we are seeing in AML may not be significantly associated to the molecule. We believe that AFM13 and AFM28, even though they are chemically a little bit different, AFM13 being a smaller molecule with a somewhat shorter half-life, we believe both of them are very potent and very capable to activate the innate immune system and then to target NK cells. I think the main difference in why we see some higher single agent activity in AFM28 is due to the underlying disease. If you look at data from non-targeted NK cells, so without any antibody, just the NK cell, consistently in AML you have seen even with non-targeted NK cell response rates in the 20%, probably even up to the lower 30% range, whereas in lymphomas, if you have not a non-targeted NK cell, you rarely see any responses.

So what we think is that AML cells can be, or seem to be more susceptible to NK cell mediated killing in general. We also think that AML patients may have still a little higher levels of patients own or intrinsic NK cells that we can activate with our ICE. We know from Hodgkin Lymphoma patients, for example, that they basically have no real functional NK cells, at least when they are in very advanced stages. So I think it’s more a difference in the underlying biology that makes AML specifically sensitive for NK cell mediated killing, and that’s why we believe that both a monotherapy development could be possible for AFM28 and for sure, an AFM28 NK cell based combination should yield even better results.

Operator: And our next question will be coming from the line of Dara Azar of Stifel.

Dara Azar: Great. Thank you, Dara Azar here for Canino. On AFM 24, based on your experience with this mechanism, how can maturation of or confirmation of final ORR by year end inform us on the quality of final PFS coming next year? And to clarify here, will we get PFS on all 40 patients in first half of ‘25 or will there be some excluded patients? Then I’ll have a follow-up.

Shawn Leland: Yes, Dara Azar, thanks for the question. Andreas, do you want to respond to Dara Azar’s question?

Andreas Harstrick : Yes. So the focus, as we said, On the December data disclosure will be on response rate, simply because we think that PFS data are not mature in this point, as many patients are still on active treatment. Response rate is one important parameter for decision making. So it will, I think, confirm our beliefs that we are able to basically break a PD-1 or PD-L1 resistance by the dual combination, which would be reflected in a high response rate or in a high rate of patients with significant tumor volume reduction. And again, the mature PFS data, which will drive the final decision are probably due in first half of 2025. Again, PFS in a non-randomized trial isn’t interesting end point, but as later you can report your PFS data, probably the better the data are. So we just have to wait until these data are really mature and I’m not sure what I got there. There was a second part of the question, which –

Dara Azar: Yes, 40 patients. Will we get PFS from all 40 patients? Or will there be some excluded patients?

Andreas Harstrick : Yes, as all protocols you have, of course, definitions of what constitutes a patient who is eligible for the protocol. I would expect that we will see PFS data from all 40 patients. We may not see response data from all 40 patients, as you usually have 1, 2, 3, patients dropping out just for the feature of missing a second scan, but all these patients would be included into the PFS analysis.

Dara Azar: Okay, thanks for your commentary. And Shawn, you talked about broadening the scope for BD partnering. What do you think is required at this time in terms of signal generation or approval path clarity from a potential partner?

Shawn Leland: Yes, which molecule there is because I think it’s different for each program.

Dara Azar: Yes, initially that was my question to try to understand what you’re prioritizing in your pipeline for potential BD opportunities. Maybe lead with that and let us know please on what is the next step? As far as what you’re trying to generate and present to a potential partner to get the ball rolling?

Shawn Leland: Yes, so, I mean, I think, as I’ve shared in response to the partnering questions. I mean, I think, we’re open to discussing partnerships around, any of our, innate cell engager programs. So, I mean, I think we’re open to having discussions on the three clinical stage assets as well as, pre-clinical programs that we have in the pipeline as well as in a potential target discovery partnerships as well. So, I mean, I think there’s a multitude of partnering options that exist across the portfolio. I mean, I think I get the impression at least, that your question is geared more towards the clinical stage assets. And, I mean, I think partners have indicated a variety of kind of different things. I mean, I think what we’ve heard from the vast majority of folks is, folks are looking to just see a bit more mature data.

And I think, as Andreas has highlighted the progress across the clinical pipeline. I think, the indications that we’ve received from potential partners is that, we are likely approaching, data sets that have kind of, the maturity as well as the size, in terms of number of patients that they’re looking to see to gain confidence, and more seriously, entertain potential partnerships. So that’s where we are at this stage in terms of discussions.

Operator: And at this time, there are no additional questions in the queue. We would like to thank everyone for participating in today’s conference call. You may all disconnect. And have a good day.