CureVac N.V. (NASDAQ:CVAC) Q3 2024 Earnings Call Transcript

CureVac N.V. (NASDAQ:CVAC) Q3 2024 Earnings Call Transcript November 12, 2024

Operator: Greetings and welcome to the CureVac Financial Results and Business Update for the Third Quarter and First Nine Months of 2024 Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Sarah Fakih, Vice President of Corporate Communications and Investor Relations. Thank you. You may begin.

Sarah Fakih: Thank you. Good morning, good afternoon, and welcome to our conference call. My name is Sarah Fakih, I’m the Vice President of Corporate Communications and Investor Relations at CureVac. Please let me introduce today’s speakers. On the call with me from CureVac are Alexander Zehnder, Chief Executive Officer of CureVac; Myriam Mendila, our Chief Scientific Officer; and our Chief Financial Officer, Axel Malkomes. Rudiger Wolff, Senior Vice President of Finance will be available for the Q&A session. Please note that this call is being webcast live and will be archived on the Events & Presentations section under Investor Relations on our website. Before we begin, a few forward-looking statements. The discussions and responses to your questions on this call reflect management’s view as of today, Tuesday, November 12, 2024.

We will be making statements and providing responses to your questions that state our intentions, beliefs, expectations, or predictions of the future. These constitute forward-looking statements for the purpose of the Safe Harbor provisions. These statements involve risks and uncertainties that could cause actual results to differ materially from those projected. CureVac disclaims any intention or obligation to revise any forward-looking statements. For more information, please refer to our filings with the U.S. Securities and Exchange Commission. I will now turn the call over to Alexander.

Alexander Zehnder: Thank you, Sarah. Ladies and gentlemen, good morning, good afternoon to everyone on the webcast. The first nine months and particularly the third quarter of 2024 marked a turning point for CureVac. We made significant progress on our 2024 priorities, taking decisive steps, rightsizing the company, streamlining our processes, and improving our business operations. We have successfully delivered on key milestones including a new licensing agreement which GSK announced in July. This agreement valued at up to €1.45 billion, includes an upfront payment of €400 million, which was fully booked in the third quarter. Additional potential milestones and royalty payments from this agreement are expected to provide significant capital going forward while strongly validating our mRNA technology.

Alongside this, we launched a corporate redesign including a roughly 30% reduction of our workforce, which will be completed by the end of this year. These efforts help us to reduce costs while maintaining a strong focus on research and development. Looking ahead, we set clear development priorities with a shortened focused on high value indications in oncology and infectious disease. In oncology of Phase I study glioblastoma due to promising preliminary data showing the potential of our mRNA technology in this highly aggressive cancer. And today, we are disclosing a new cancer vaccine program targeting squamous non-small cell lung cancer, expanding our off-the-shelf cancer vaccine pipeline. In infectious diseases, we launched a new program, urinary tract infections or UTIs, one of the world’s most common infections.

This program addresses a critical unmet medical need driven by recurring infections and the increase in prevalence of antibiotic resistance against uropathogenic E. coli, the bacteria that primarily causes these infections. A UTI program exemplifies our focus on leveraging our technology for areas of high unmet needs with significant commercial potential. On Slide 5, you can see this achievement in the context of our transformation journey. After I started in April, 2023, we conducted a thorough business analysis identifying key areas to improve our financial discipline, reducing unneeded pandemic era infrastructure and focusing the organization on innovation and R&D. In 2024, we are executing on these insights. We have launched a corporate redesign, which is on track for roughly 30% workforce reduction by the end of this year without compromising our R&D and manufacturing capabilities.

Operational expenses are expected to decrease by over 30% starting in 2025. The €400 million upfront payment from our new licensing agreement with GSK was fully booked in the third quarter, providing us with a strong cash position of €551 million at the end of September and resulting in a net profit for the first nine months. As we approach the end of 2024, we are now leader, more strategically aligned and financially stronger. And from this position of strength, we will double down on research and development activities. We’ll focus on high value opportunities in oncology and infectious diseases. On Slide 6, we outlined the pipeline expansion in both oncology and infectious diseases. In oncology shown on the left, our pipeline expansion spends both off-the-shelf and personalized cancer vaccines.

For the off-the-shelf cancer vaccines, we are disclosing a new shared-antigen cancer vaccine program in squamous non-small cell lung cancer, which will include novel cancer antigens derived from our proprietary antigen discovery. We are prepared for IND and CTA submissions in the first half of 2025 and expect to start a Phase I trial shortly thereafter. Discovery activities for additional shared-antigen programs continue with the second clinical candidate expected in 2026. Pre-clinical development of a fully personalized cancer vaccine candidate is also progressing with the first candidate expected to enter the clinic in the second half of 2026. In infectious diseases, we are also following a dual strategy, having licensed our advanced program in respiratory diseases to GSK by focusing our proprietary programs primarily on non-respiratory diseases with high unmet medical needs.

Here we have launched a new program for urinary tract infections, which are the world’s most common infections and we will present the process in preclinical data for this program later in the presentation. Before I go into the business update, I’m delighted to have a new Chief Financial Officer, Axel Malkomes who joined CureVac just yesterday on the Congress. On behalf of the full CureVac team, welcome. Axel brings over 30 years of experience across both the corporate and banking sides of our industry. This deep expertise will be crucial for the next chapter of CureVac, as we advance our strategic initiatives and strengthen our financial foundation. Axel, would you like to say a few words?

Axel Malkomes: Thank you, Alex, and good morning, good afternoon, everyone on the webcast and conference call. I’m truly excited to join CureVac during this pivotal moment, the company’s evolution. I believe CureVac poised to make continued remarkable progress in development of innovative mRNA based medicines. By applying my expertise in financial management and corporate growth, I’m convinced, I can help drive CureVac’s mission forward and contribute to its future success.

Alexander Zehnder: Thank you, Axel. As we continue moving forward with our business and pipeline priorities, it’s important to highlight what makes CureVac unique. On Slide 8, you can see this key strategic and technological differentiators that set CureVac part in the mRNA field. In terms of strategic differentiators, we have a dual strategy in oncology working on both off-the-shelf and personalized cancer vaccines to cover a right range of cancer types. Use the similar dual approach in infectious diseases where we are focusing on proprietary programs for non-respiratory diseases like viral, bacterial or fungal infections while we have out licensed our respiratory disease programs to GSK. Our scalable manufacturing capabilities, including the RNA printer, gives us the flexibility to produce preclinical and clinical trial materials efficiently and are strong than actual property portfolio further supports our innovation by protecting our technology.

In terms of technology differentiators, our precision mRNA backbone is built on 20 years of experience, helping us design highly efficient mRNA constructs that improve protein expression and low dose efficiency. In oncology, we have a unique ability to discover new classes of antigens which paves the way for more [indiscernible] cancer treatments and our work on advanced lipid nanoparticle delivery system tailored for specific indications and aims to enhance the effectiveness and stability of vaccines. Together these differentiators give us a strong competitive position and drive our mission to develop transformative reference for patients. Slide 9, shows how our differentiators speed directly into the key focus area for oncology and infectious diseases.

Our precise mRNA backbone and proprietary delivery systems or [indiscernible] technology platform, which is continuously evolving VPA to deliver best-in-class products. By focusing on development efforts on high potential areas in oncology and infectious diseases, we are positioning mainly ourselves to deliver impactful health solutions. And with that, I will hand over to Myriam to explain how returning these technologies into a strong focused clinical pipeline.

Myriam Mendila: Thank you, Alex. Good morning, good afternoon to everyone. Moving on to Slide 10. Let me outline our most recent pipeline, which reflects our focused strategic approach to high value development programs relevant to patients. Both our existing programs and the new programs is closed today, demonstrate our commitment to selecting indications where mRNA technology can make a substantial difference, addressing unmet clinical needs and attractive market opportunities. In oncology, our existing pipeline for off-the-shelf cancer vaccines is led by all Phase I study in patients with effective glioblastoma, which has recently provided promising data for the completed dose-escalation Part A of the study. The study started enrollment for the dose confirmation Part B in August, 2024, testing the recommended dose of 100 micrograms and enrollment is progressing well.

We also announced a new program with an off-the-shelf cancer vaccine to treat patients with squamous non-small cell lung cancer. The vaccine candidate to be tested, encode for new antigens discovery with our proprietary antigen discovery platform. In the infectious disease area, our most advanced programs cover respiratory indications fully licensed with GSK. Programs for seasonal influenza, avian influenza and COVID-19 are based on proprietary second-generation mRNA backbone and are currently in Phase II development. GSK announced positive Phase II headline data for seasonal influenza, concerning strong antibody titers against influenza A strains and most important B, also against the notoriously challenging influenza B strains compared to the estimated standard of care in younger and older adults.

The study met all predefined success criteria and GSK reported that the program is progressing to Phase III next year. Based on the validation of our platform and infectious diseases, we launched a new proprietary program to develop a prophylactic vaccine against uropathogenic Escherichia coli, the primary cause of urinary tract infections, which range amongst the most common infections worldwide. I will go into more detail later in the presentation. And the third therapeutic area molecular therapies while the collaboration with the [indiscernible] diseases was recently terminated, we continue to develop optimized mRNA therapeutics in different areas. We are committed to focus our pipeline on selecting indications where mRNA technology can also perform conventional approaches guided by our mission to advance innovation in preventive and therapeutic health solutions.

On Slide 11, we dive deeper into our oncology strategy where we see tremendous opportunity for mRNA cancer vaccine to bring precision immunotherapy to large patient populations. We have made significant progress in advancing our two-pronged strategy for both off-the-shelf and first line cancer vaccine development. As a brief reminder, the off-the-shelf assets in our oncology pipeline target tumor antigens that are shared across different patient populations and/or tumor types to induce the novel or anti pre-existing immune responses in different cancer settings including advanced stages of cancer. CVGBM, our lead oncology clinical candidate is currently being evaluated in a Phase I study in patients with resected glioblastoma and encoding known antigens relevant to this highly aggressive brain cancer.

All our next generation shared antigen cancer vaccines including the one in squamous non-small cell lung cancer feature novel antigens discovered through our proprietary antigen discovery platform and will expand our pipeline with new clinical candidates in 2025 and 2026. By identifying novel shared antigen targets, also, within our global collaboration with MD Anderson, we aim to make our vaccines even more effective in reducing the risk of tumor recurrence and enhancing outcomes for patients in different cancer settings. For the other part of our oncology strategy, applying personalized cancer vaccines whole genome sequencing of individual patients tumor samples combined with advanced bioinformatics is utilized to identify neo antigens and/or normal tumor associated antigens you need for patient’s individual genomic tumor profile.

This precision medicine approach increases the likelihood of targeting antigens susceptible to immunotherapy and aim to provide a curative approach, especially in early stage cancer with lower chemokine. Our first cancer strategy is complemented by the RNA printer, our solution for fast and highly automated manufacturer. We made significant programs with our oncology pipeline and recently presented data from our clinical lead program with the off-the-shelf vaccine candidate CVGBM, which was tested in the Phase I study in patients with resected glioblastoma. You might recall that CVGBM features a uniquely designed single unmodified mRNA construct, encoding eight segments derived from four tumor associated antigens with demonstrated immunogenicity and resected glioblastoma.

It was administered as the monotherapy of the surgical resection and completion of radiotherapy with our chemotherapy. Patients receive seven intramuscular vaccinations within 10 weeks and optional maintenance vaccinations in case of non-progression for potential [indiscernible]. Preliminary safety and immunogenicity data from the dose escalation Part A of the study were recently presented at the ESMO and Congress. In this highly challenging and aggressive cancer type, the data confirmed the favor with safety and tolerability profile with no dose limiting toxicity observed in this part of the trial. Successful induction of antigen specific T cell responses was demonstrated in the vast majority of valuable patients with 77% of patients showing [indiscernible] and/or T cell response to at least one of the encoded antigens on the vaccine.

Most importantly, within the group of regular patients, 84% of the immuneresponses were induced de novo meaning a response that successfully in use in patients who had no preexistent detail activity and get against encoded antigen prior to vaccination with CVGBM. Additionally, 67% of responding patients had T cell responses against multiple encoded cancer antigens, supporting our antigen selection and successful mRNA design. At the highest tested dose of 100 micrograms, ongoing monitoring of T cell durability showed that responses were sustained over a period of 99 days. The 100 microgram dose was also selected for dose confirmation copy of the study, which began enrollment in August of this year. A first data readout of – is expected in the second half of 2025.

We continue to advance our oncology pipeline and on that circuit we have summarized our upcoming oncology catalyst, which provides strong development task over the next 24 months. Seven is our most advanced based off-the-shelf program and we said that glioblastoma is already mentioned and enrollment of the dose confirmation that we offered is progressing well. We expect enrollment to be completed. The latest in the first half of 2025, allowing for a data readout in the second half of 2025. Data from an additional up to 20 patients dose at 100 micrograms will provide the basis for potentially continuing to a Phase II study, which could start in the second half of 2026. The newly announced off-the-shelf program in squamous non-small cell lung cancer is expected to enter Phase I clinical development in the second half of 2025.

With our proprietary antigen therapy work continuing, we intend to withdraw additional off-the-shelf program with new clinical candidates in different indications in 2026. Lastly, the first clinical Phase I study with a personalized cancer vaccine candidate is expected to start on the second half of 2026. These strong catalysts highlight our strategic focus on opportunities oncology, leveraging our mRNA technology designed to ensure continuous progress and innovation on our oncology segment. Let me now shift gears and turn to our infectious diseases area. In infectious diseases, we are directing our current proprietary research and development efforts towards new non-respiratory indications while benefiting from the ongoing clinical development of respiratory indications with current programs license to GSK targeting non-respiratory infections caused by the bacteria, viruses and fungi.

We aim to deliver safe and cost effective vaccines for high unmet medical need areas with compelling market potential where our mRNA technology offers an advantage for our conventional vaccine technologies. In this area, we are excited to introduce a new fully-owned infectious disease program targeting uropathogenic E. coli bacteria, in short UPEC. UPEC is the primary cause of urinary tract infections which rank amongst the most common infections worldwide. The statistics presented on Slide 15 highlighted the significant incident and disease burden associated with UPEC in the U.S. The high prevalence of UTIs with more than 50% of patients requiring antibiotic therapy, needing to increase antibiotic resistance and high rates of recurrence presents as central challenge in current medical practice.

This results in direct medical costs reaching billions of dollars and only in the U.S. alone. Currently there are very limited treatment options to prevent recurrent UTIs. Our mRNA technology has a potential to deliver a best-in-class solution including functionally using and functional antibodies as well as titers and T cells responses against UPEC. To tackle this infection we developed mRNA vaccine candidates and CVnCoV in bacteria protein considered crucial for adhesion of the bacteria to bladder tissue and bio cell formation. [Indiscernible] is highly conserved in UPEC strains and therefore represents an excellent vaccine target for the vast majority of patients. For our vaccine candidates tested in preclinical studies, we have applied rational antigen designs to optimize immunogenicity.

In addition, we have applied a unique technology to design candidates that lead to the in-vivo cell assembly of a thin H nanoparticle. This innovative design is expected to lead to even higher immunogenicity. Let me show you this very promising preclinical data we created with two of our candidates. On Slide 16, you can see the first preclinical data which are currently being presented as the first mRNA Health Conference taking place this week in Boston. We tested our vaccine candidates in two preclinical models Wistar Rat and BALB/c mice in comparison to non-licensed recombinant protein vaccines. [Indiscernible] binding and function antibodies meaning antibodies inhibiting hallucination and/or bacterial adhesion were met within both models and serum and urine samples.

Additionally, CD8 and CD4 T-cell responses were determined in mice. Both mRNA vaccine candidates induce high levels of binding antibody titers in blood and urine in both models. That also correlated with high functional antibody titers from serum. Importantly, functional serum antibodies were higher with both mRNA vaccine candidates compared to the protein-based comparative vaccines. Our nanoparticle candidate demonstrated the highest overall levels of often age specific binding and functional antibodies in serum and urine of the animals outperforming all other tested candidates. Additionally, both mRNA vaccine candidates and the entire T cell responses then compare that protein-based vaccines with a nanoparticle candidate against strongly outperforming all other candidates.

Overall, our infectious disease programs show promising progress with both non-respiratory and respiratory areas advancing based on solid development catalyst outside on Slide 17. Our newly launched UPEC program, we expect to select a clinical candidate in the first half of 2025, enabling us to file for IND submission in the second half of 2025. This anticipated to allow Phase I clinical development to start in the first half of 2026. Additional discovery work and other non-respiratory disease is also progressing and we anticipate strengthening our pipelines in this area with additional programs in 2025 for which clinical candidates could be selected in the second half of 2023. For the respiratory program license to GSK, please note that the closer of the timeline remains at the discretion of GSK.

As recently contract by GSK, the seasonal influenza program is expected to progress to Phase III in 2025. Further available timelines for the license program include anticipated data readout for the avian influenza study in the first half of 2025. GSK is also about to initiate a new combined Phase I study for an influenza COVID-19 combination vaccine. Corresponding information can be found on clinicaltrials.com. Data is expected in the first half of 2025. With this, I would like to conclude the portfolio update and move over to Axel for a review of the financial data.

Axel Malkomes: Thank you, Myriam. Looking at the significant progress we’ve made, streamlining our operations and focusing on strategic priorities, I would like to provide context to key financial metrics on Slide 18, demonstrating our financial and cash runway enabling us to reinvest in key areas of growth and innovation. Today, we report a strong cash position of €551 million at the end of the third quarter 2025 and reaffirm our cash runway into 2028. Our results are driven by the new licensing agreement with GSK, which positively impacted our cash position as well as revenues. The €400 million upfront from the agreement was received as a non-refundable payment for granting licenses to GSK and the right to use CureVac’s intellectual property but no further R&D or obligation on our side.

As such, it would fully – it was fully recognized as revenue in the third quarter of 2024. Given that under the terms of the new licensing agreement, all obligations from prior collaborations relating to R&D services had expired. Remaining contract liability amounting to €80.4 million were also recognized as revenue in the third quarter of 2024. Turning to quarters for increased future financial stability on strategic redesigns, key to enhancing our operational efficiency further reduce costs. The efficient execution of the 30% workforce reduction on track to be completed by the end of this year 2024 incurred costs approximately 14% below the allocated budget. From 2024 onwards, we anticipate a substantial increase in operating expenses by over 30%, including a notable €25 million reduction in personnel costs.

Our licensing agreement with GSK and renewed focus on innovation and R&D activities had also eliminated the need for commercial buildup and large scale manufacturing activities. Streamlining of our in-house manufacturing capacities to provide a new manufacturing footprint better suited to our needs for the company by partial impairment of a large scale GMP IV production facility. Lastly, we have successfully terminated all remaining raw material commitments and closed all contract manufacturing organization for CMO-related arbitrations for our first generation COVID-19 vaccine in the third quarter, ensuring no further related payments. Moving on to our condensed financial statement on Slide 19. You can see that our cash position of €550.9 million increased from €402.5 million at the end of 2023 based on the €400 billion upfront and from GSK in August, 2024.

The increase is partially offset by our ongoing R&D activities as well as last payments related to our first generation COVID-19 vaccine. As already discussed, revenues strongly increased by €477.4 million to €493.9 million for the third quarter, and by €489.5 million to €520.7 million for the nine months end of 2024 compared to the same period of 2023. And the year-on-year increase was primarily driven by the license agreement with GSK. This must be seen as a positive one-time events. Operating profit was €368.4 million for the third quarter 2024 compared to an operating loss of €54 million for the same quarter in 2023. For the first nine months of 2024, operating profit was €221.4 million compared to an operating loss of €186.2 million for the same period in 2023.

The operating result was affected by several key drivers. First, cost of sale increased year-on-year, mainly due to high arbitration costs for CMO activities related to the first generation COVID-19 vaccine as well as due to higher personnel expenses related to the redesign of the organization. Second, R&D expenses increased with higher investments in oncology development programs as well as increased expenses related to the litigation to enforce intellectual property rights. Third, general and administrative expenses decreased compared to the prior year period, mainly driven by lower personnel expenses. Lastly, other operating expenses increased due to the discussed partial impairments of CureVac’s GMP IV production facility. Financial results decreased by €3.1 million to €2.2 million in third quarter of 2024, decreased by €4.7 million to €8 million for the first nine months of 2024 from period compared to the same period in 2023.

The decrease was mainly driven by lower interest income on cash investments. Pre-tax profit was €370.6 million for the third quarter and €229.4 million for the first nine months of 2024 compared to a pre-tax loss in the same periods of 2023. And with this, I’d like to hand back call to Alexander for today’s key messages.

Alexander Zehnder: Thank you, Axel. Now let’s summarize the key highlights for Q3 2024. We posted third quarter of 2024 with a cash balance of €550.9 million, providing us with a solid financial runway into 2028. This strengthens our ability to continue driving innovation and growth. In addition, we are making significant progress on our strategic transformation, including a 30% reduction by the end of 2024. This will contribute to substantial cost savings starting in 2025 and enhancing our operational efficiencies. In oncology, they are advancing off-the-shelf and personalized cancer vaccines. Our glioblastoma trial is showing promising early results, and we are planning new trials in 2025 and 2026. And in infectious disease, we are moving forward with the UPEC vaccine for UTIs. Additionally, our partner GSK is advancing a seasonal influenza vaccine into Phase III next year, and it’s about to initiate a combined Phase I/II study for COVID influenza combination vaccine, both leveraging our platform.

And as the end of 2025, we are well positioned, well financed, focused on high value opportunities and supported by strategic partnerships and robust IP portfolio. These elements position us well for ongoing growth and success in tackling major health challenges. And with that, I would like to conclude our presentation and open the floor for your questions.

Q&A Session

Operator: Great. Thank you. At this time we’ll be conducting a question-and-answer session. [Operator Instructions] First question here is from Charlie Yang from Bank of America. Please go ahead.

Charlie Yang: Great. Thanks for taking the question. I have two, please. I think one, can you discuss perhaps kind of your thoughts about business opportunity, licensing opportunity outside of the mRNA, kind of your core expertise, whether that is an area of potential interest just given your cash position. And then second of all, can you discuss about the kind of litigation account update and what should we expect on that front? Thank you.

Alexander Zehnder: Okay. Thank you. So on your first question on business opportunities. At the moment, we stay very focused on the two areas that we described during the presentation, which is oncology on one hand and infectious diseases on the other hand. And within these two areas, we already do have collaboration with GSK on one hand and the MD Anderson on the other hand. But of course, we are always hoping to look at new opportunities within these two areas that will help us to strengthen our portfolio and especially accelerate our path to the clinic. With regards to litigation, so these are ongoing. I think the next time point, for you to keep in mind is the U.S. Court case, which has been scheduled for March 2025, so March next year. So work is ongoing for us to prepare as best as we can for these events. So other than that, we don’t have much to update you on just now.

Charlie Yang: Thank you.

Operator: Our next question is from Mani Foroohar from Leerink Partners. Please go ahead.

CJ Yeh: Hi, there. Thanks for taking our question. This is CJ on Mani. Following your encouraging flu data, I was wondering if you could share any commentary and plans for developing a combo vaccine for flu COVID? Thank you.

Alexander Zehnder: Question on flu, flu combo, flu COVID combo, Myriam?

Myriam Mendila: Yes. I mean, this question should ideally be addressed by GSK. But of course, we all believe that given the epidemiology and the occurrence of infections, a combination for patients of the flu vaccine and COVID vaccine would be the most convenient approach, right? And most promising, that’s why all of the development efforts in the past when we were still in collaboration, we focused on this. The Phase I study starts now as we also shared. And we expect the data readout next year for decision making to progress to Phase II. I’m not sure I addressed your question. But I think the program is progressing especially because of the very positive Phase II data influenza. And we are optimistic that this is going to be a continuous effects of the program.

CJ Yeh: Great. Thank you so much.

Operator: Next question is from [indiscernible]. Please go ahead.

Unidentified Analyst: Hello, team, congrats with the update. This is Sarah from Van Lanschot Kempen. And I’m on behalf of Suzanne. So I was wondering any color or reasoning you can provide on selecting lung cancer as the new indication? And then following up the previous question, can you say something regarding patent litigation on the U.S. front, on the Europe front? Thanks.

Alexander Zehnder: Okay. May I have any one question for you? I think it was a question if I assume understood correctly or indication selection or wise squamous?

Myriam Mendila: Exactly. That’s what I also understand. And sorry, because the acoustics were not great. Yes. So we have to, of course when we select the candidate, we have to follow the science right? And basically, in our approach just cover antigens a shared-antigen that are shared across different cancer indications. And we also wanted to include novel classes of antigens. And so in our research, again, we found appropriate coverage of novel antigens in squamous non-small cell lung cancer. So following the signs that the indication we selected for our, what we think very innovative next research, antigen cancer vaccine to address the high unmet need in this population. So the indication is basically based on the signs of the data and the [indiscernible] of our antigen discovery work. Does that answer your question again, because it wasn’t easy to understand because of acoustics?

Unidentified Analyst: Yes, perfectly. I hope my sound is now better. But it was perfectly on point. And regarding recent litigation on the European front?

Alexander Zehnder: Yes. So in Europe, it’s a bit more complex, whereas in the U.S., all the different cases are bundled in one case. And we have one court case on validity infringement and damages in Europe. It’s really on a case by case basis, right? So this is something that will continue throughout the next years. We do expect further rulings from the European patent notice on our patents in the second quarter of next year as well as from the regional court in Düsseldorf, in the second or third quarter. But so in Europe, it’s going to be an ongoing process throughout 2025 and maybe leading into 2026 on a patent per patent basis, right? But I think the key visibility, the key event from at least for the first time will be the U.S. case in March.

Unidentified Analyst: Okay. Thank you so much.

Operator: Our next question is from Roy Buchanan from Citizens. Please go ahead.

Roy Buchanan: Hey. Thanks for taking the questions. Just a couple of [Indiscernible] questions. I think there was a prior protein-based program that didn’t move forward. Can you just maybe comment on if your engineering approaches address maybe why that program didn’t move forward? And then any thoughts on how your – I think there’s a glycoconjugate program is Phase III. Any thoughts on how your approach could be better than that? Thanks.

Myriam Mendila: So again, I’m sorry, your audio is a little bit difficult. So I heard the first questions. VlsE and FimH right? If I understand correctly, and VlsE and FimH is easy to address. It is a highly conserved antigen in UPEC bacteria and that’s a pathogenic antigen, we basically are able to cover about 95% of the population affected by UPEC. That’s the first one. The second one is, this basically antigen trial testing been kind of validated in preclinical trials. And even if you want go there in a Phase I/II study that another sort of a company, who is testing a peptide-based vaccines. So FimH is validated, I think, as a target to address UPEC bacteria. And this is a conserved antigen. Your second part of the question is about the antigen design.

Again, we applied something very innovative, right? And the way how we select the target FimH in it, I don’t want to get too much into the details, but in a free binding transformation so that we really can get the bacteria before it has attached to the endothelial cells in the bladder. And then we have for the first time applied a design where, again, the encoded protein from the nanoparticle with ferritin in the core, and then basically a lot of FimH and proteins expressed on the surface to really induce a stronger immune response. And that is designed again in our preclinical studies, translated to a really beautiful immunogenicity showing very high size of binding and what is even more important functional antibodies. And when we compare it to a protein-based design targeting FimH, it showed basically superior immunogenicity, both for humoral antibody responses and T-cell responses.

I know you had a part of the question about another program, but I didn’t hear that very clearly.

Roy Buchanan: I think it was more a question about differentiation, right? When there are more advanced program, why do we believe an approach with an mRNA or vaccine could be differentiated or different?

Myriam Mendila: Well, I think especially in this setting, again, mRNA per se, it differentiated in that we can show clearly induction of humoral and cellular new responses as shared in our preclinical data because we believe UPEC you have to address through, again, targeting attack antibodies as well as cellular responses because the bacteria, the cells in the bladder. So that’s first part why it is [indiscernible]. And then the other part is of course, because of the way how we designed our vaccines and the target that we have selected.

Roy Buchanan: Okay, great. And the design was all in house or did you in-license any technology? Thanks. That’s it.

Myriam Mendila: This is the proprietary technology that it is all or a section of it.

Roy Buchanan: Got it. Thank you.

Operator: Next question is from John Miller from Evercore. Please go ahead.

Unidentified Analyst: Hi. This is [indiscernible] for John. Thanks for taking our question, I guess on the GBM program. Apparently, very good response from T-cells. But how should we think about the translation towards tumor response based off the data. And also for the overall off-the-shelf program, what are the indications that of most interest? Thank you.

Myriam Mendila: Yes. Thanks a lot. So maybe for GBM, this is a super important question, right, that nobody can answer at this point. How does the immunologic response translate into clinical benefit? And there we again, we need to wait for more data coming from our extension cohort. We have presented it as a very early preliminary clinical readouts from our Phase I escalation cohort. In those data we shared that we had one partial response in the patient where that the trial was only a partial tumor reduction. And again, under monotherapies, our vaccine, that patients developed a partial response. Unfortunately, the immunogenicity relapse, did fail in this patient because they couldn’t connect enough cell samples. But at least one partial response was observed in our Phase I dose escalation part.

And then the other part that you could look at, again, all under the caveat early data, it is 16 patients, but we also looked at the PFS at six months in this vac prognosis population where we saw our trial PFS at six months of about 34%. And then you compare this to data share at ASCO this year from basically a trial conducted by similar investigators that participate in another trial in [indiscernible] trial. They share that patients with unmethylated GBM, treated just with radiotherapy plus minus temozolomide had a PFS at six months or only 18%. So again, I have to copy, this is early data as a handful of patients, but we do see some promising even clinical fitness. Now, what we are doing in the drug extension part, again, we collect more information on more patients.

We collect more and also deeper immunogenicity data, and we will collect across the clinical data so that at the end we can hopefully correlate the two and then made a robust decision whether we go into Phase II or not.

Unidentified Analyst: I guess the second question was around indication selection for the rest of the off-the-shelf vaccine. So I think we already communicated on squamous non-small cell lung cancer, right? And I think work on the indication selection for the next share vac program potentially after the MD Anderson congregation is still ongoing.

Myriam Mendila: Right. And maybe just to build on this, we have conducted, end of last year, beginning of this year an extensive oncology strategy exercise where we looked at all different kinds of indications, which could be targeted by a cancer vaccine. And we consider criteria such as, likelihood of scientific success, unmet medical needs, competitive environment and commercial opportunities, and have prioritized a few cancer indications that where we will go deeper into the discovery for cancer and cancer antigen. So it’s a selection of next mutation is really following a strategic approach that has been also translated into our collaboration with MD Anderson, where we focused together on again, promising scientifically, but also commercially promising areas in oncology.

Unidentified Analyst: Thank you very much.

Operator: [Operator Instructions] If there are no further questions, I’d like to turn the floor back to management for any closing comments.

Sarah Fakih: With this we would like to conclude our conference call. Thank you very much for your participation. Stay safe and please don’t hesitate to contact us should you have any further questions. Thank you and goodbye.

Operator: This concludes today’s teleconference. You may disconnect your lines at this time. Thank you again for your participation.