CytomX Therapeutics, Inc. (NASDAQ:CTMX) Q4 2024 Earnings Call Transcript

CytomX Therapeutics, Inc. (NASDAQ:CTMX) Q4 2024 Earnings Call Transcript March 6, 2025

CytomX Therapeutics, Inc. beats earnings expectations. Reported EPS is $0.22, expectations were $-0.23.

Operator: Good afternoon, everyone. Thank you for standing by. Welcome to the CytomX Therapeutics, Fourth Quarter 2024 financial results call. Please be advised that today’s call is being recorded. I would now like to hand the call over to your host for today, Chris Ogden, CytomX’s Chief Financial Officer. Please go ahead.

Chris Ogden: Thank you. Good afternoon, and thank you for joining us. Before we begin, I’d like to remind everyone that during this call, we will be making forward-looking statements. Because forward-looking statements relate to the future, they are subject to inherent uncertainties and risks that are difficult to predict and many of which are outside of our control. Important risks and uncertainties are set forth in our most recent public filings with the SEC, at sec.gov. We undertake no obligation to update any forward-looking statements whether as a result of new information, future developments, or otherwise. Earlier this afternoon, we issued a press release that includes a summary of our 2024 full-year financial results and highlights recent progress at CytomX Therapeutics, Inc.

We encourage everyone to read today’s press release and the associated materials which have been filed with the SEC. Additionally, the press release, recording of this call, and our SEC filings can be found under the Investors and News section of our website. With me on the call today is Dr. Sean McCarthy, CytomX’s Chief Executive Officer and Chairman. Sean will provide an update on our pipeline and company progress before I walk through the financials for 2024. We will then conclude with the Q&A session. With that, I’ll now turn the call over to Sean.

Sean McCarthy: Thanks, Chris, and good afternoon, everyone. We are very pleased to be here with you today to provide updates on our continued progress at CytomX Therapeutics, Inc., towards our mission of urgently advancing our probody therapeutic pipeline for the maximum benefit of cancer patients. As a pioneer in the field of antibody masking and conditional activation, we continue to direct our powerful technology platform towards major unmet needs in oncology. We are seeing broad strategic interest in antibody masking and CytomX is uniquely positioned with expertise and capabilities to deliver novel, masked therapeutics across multiple treatment modalities, including antibody-drug conjugates, T cell engagers, and cytokines.

Our current clinical programs have been built on over a decade of scientific and clinical expertise and follow clear design principles aimed at optimally selecting the cancer type of interest, the tumor target, and the relevant effective function in order to deliver differentiated cancer therapies. 2024 was a very productive year for us, including the advancement of two new programs into the clinic, CX-2051 and CX-801. In January 2025, we announced the prioritization of these programs and the streamlining of our organization, extending our cash runway to Q2 of 2026, supporting our ability to deliver upon key clinical milestones. We see our lead program, CX-2051, as a highly differentiated first-in-class ADC that is designed to address a large unmet need in colorectal cancer and build significant value for CytomX Therapeutics, Inc.

CX-801 is a masked version of interferon alpha with, we believe, broad potential as a next-generation targeted immunotherapy. 2025 promises to be an exciting year for CytomX Therapeutics, Inc. where we expect to generate initial clinical data for both CX-2051 and CX-801 that we believe could drive significant near-term value creation. I’d like to cover recent progress in our pipeline before handing over to Chris who will review our financials. I’ll start with our lead program, CX-2051. Our first-in-class masked ADC targeting epithelial cell adhesion molecule, we are the only organization to our knowledge addressing this target in this unique way. EPCAM has been viewed as a high potential opportunity for many years due to its pan-tumor expression and its particularly high expression.

However, EPCAM is also expressed at moderate to high levels in normal tissue which has prohibited the successful development of systemic therapeutics against this target. There’s strong evidence, though, that EPCAM targeting with locally delivered approaches can achieve clinical anti-cancer activity, including the multi-specific antibody Corjune that is currently being relaunched in the EU for the localized treatment of intraperitoneal malignant ascites. Despite success with localized therapies, however, prior systemic EPCAM targeting strategies have not been able to reach therapeutically active drug levels in patients. And these include the T cell engagers, salivumab, and other antibody approaches which showed early promise but were unable to deliver a viable therapeutic window due to dose-limiting toxicities in the pancreas, liver, and gastrointestinal tract.

CX-2051 is a Probody ADC comprising a high-affinity EPCAM antibody with a peptide mask and a protease cleavable mask linker that has been validated in prior clinical work by CytomX Therapeutics, Inc. In designing CX-2051, our goal is to mitigate potential on-target EPCAM toxicities and to localize CX-2051 preferentially to tumor tissue. Preclinically, CX-2051 has shown a wide potential therapeutic index and potent anticancer activity in multiple EPCAM expressing indications. The payload on CX-2051, camp fifty-nine, is a topoisomerase one inhibitor selected specifically to treat topo-one sensitive tumors and in particular colorectal cancer. The topo one inhibitor irinotecan is, of course, a key component in the treatment of metastatic CRC in the first and second-line settings.

And so it’s well established that this cancer can respond well to this class of drug. Global unmet need in colorectal cancer is one of the most significant in oncology with more than 1.9 million new cases annually and limited new treatments emerging for patients over the last two decades. Unfortunately, there’s also an increasing percentage of new CRC cases diagnosed as metastatic and a concerning trend of growing incidence in younger patient populations. First and second-line treatment for metastatic CRC are still primarily based on systemic chemotherapy regimens that include irinotecan or oxaliplatin. In the later line setting, patient options remain highly inadequate. In patients that have generally had three or more prior lines of therapy, current standard of care only achieves low to mid-single-digit objective response rates and median progression-free survival of only two to four months.

We advanced CX-2051 into the clinic in Q2 last year and we have been pleased with the execution and enrollment in the study to date. We are currently focused in late-line CRC with enrolled patients generally having received at least three prior systemic therapies. Given the consistently high levels of EPCAM expression in CRC, we are not pre-selecting patients for EPCAM expression in our Phase one study or for disease characteristics such as KRAS mutational status or liver metastases. In dose escalation thus far, we’ve been encouraged by the CX-2051 safety profile having successfully dose escalated to levels that we predict based on preclinical modeling to be biologically active, and that we’re confident could not be achieved with an unmasked ADC.

As we continue in dose escalation, our expectation is that the maximum tolerated dose of 2051 will be largely driven by the cytotoxic payload. Specifically, we will be fully characterizing the anticipated GI toxicities and cytopenias such as neutropenia and anemia that’s how commonly associated with topo-one inhibitors. We’re currently evaluating the seventh dose level in our dose escalation and we have also begun to selectively backfill at certain dose levels to gain additional experience with the drug. Overall, we believe our early clinical experience with CX-2051 is showing that this first-in-class ADC is performing as designed. Underpinning its prioritization as the lead program for CytomX Therapeutics, Inc., and our focus on bringing this therapy to patients as quickly as possible.

We remain on track to provide initial phase 1a data in CRC in the first half of 2025 and we expect to be in a position to define next steps for the program in the second half of the year. Now moving to CX-801, I must pro body interferon alpha 2b, which is also making good early progress in phase one. Interferon alpha is a well-validated therapeutic and was one of the first immunotherapies to be approved for cancer treatment. Interferon has established single-agent anti-cancer activity in multiple tumor types, including renal cancer, bladder cancer, and melanoma. Over time, systemic interferon has fallen out of clinical use in oncology, primarily due to its poor tolerability arising from systemic toxicities. However, interferon alpha is a powerful driver of T cell activation and antigen presentation making it an ideal combination agent with checkpoint inhibitors.

Similarly to EPCAM, it’s been shown recently that localized interferon alpha 2b can be very effective as an anti-cancer therapy. Specifically, the recently approved gene therapy adcillaries in encoding its virion alpha 2b achieved a 51% complete response rate in patients with bladder cancer, reaffirming that this potent cytokine can indeed achieve robust antitumor responses in patients. It’s also been shown that interferon can potentiate the clinical effects of PD-one inhibition, including a Merck-sponsored study demonstrating a 60% response rate with KEYTRUDA in combination with insulin alpha 2b in advanced PD one naive melanoma. This combination was not further developed, however, due to grade three or higher adverse events occurring in approximately 50% of patients.

The CX-801 is designed to harness the proven power of interferon alpha-2b by reducing systemic activity and localizing therapeutic activity to the tumor microenvironment. We initiated our Phase one dose escalation study of CX-801 in the third quarter of 2024, focused on the advanced metastatic melanoma setting. We’ve made very good progress to date in the study and we’re currently enrolling the fourth monotherapy dose escalation cohort. Importantly, as of the third dose level, we had already achieved doses that surpassed the approved dose of unmasked interferon alpha 2b Styloson. Our translational science program for CX-801 is multifaceted and includes systemic and intratumoral analysis of PD biomarkers that will give us insight into the molecular performance of the drug candidate and we hope the induction of an inflammatory tumor microenvironment conducive to PD-one combination therapy.

Our goal is to present initial phase 1a translational data for CX-801 in the second half of this year. Based on our progress to date, we also anticipate the initiation of combination therapy with KEYTRUDA in 2025 under the collaboration and supply agreement we secured with Merck last year. Overall, we believe CX-801 is well positioned to demonstrate clinical proof of concept in advanced melanoma where the unmet need remains very high. Longer term, we see CX-801 as the foundational combination agent which could potentially address the large population of cancer patients who do not respond to checkpoint inhibitors or who are refractory to immunotherapy. Turning back to our research collaborations, our partnerships continue to be very important to us in 2024 and remain so in 2025.

I’m very pleased to say that in February of this year, we achieved another $5 million milestone payment in our STELLUS T cell Engager collaboration as a result of Astellas selecting a collaboration clinical candidate to advance into GLP toxicology studies. We look forward to continued progress with Astellas as well as strong execution in our discovery programs with Bristol Myers Squibb, Amgen, Moderna, and Regeneron. Right now, the majority of our partner discovery programs are masked T cell engagers, an area in which CytomX Therapeutics, Inc. and our partners continue to see significant potential. Regarding our first partner T cell engager program entered into we communicated earlier this year a reduction in capital allocation to this program given our overall pipeline priorities and pending ongoing dialogue with our partner, Amgen regarding potential next steps.

Based on CH906 clinical observations to date, and our respective priorities, CytomX Therapeutics, Inc. and Amgen have jointly decided not to continue CX-904 development. We continue T cell engager discovery work with Amgen. We remain optimistic about the potential of future masked T cell engagers and really look forward to making additional progress on this modality within our partnerships. With that, let me turn the call over to Chris for updates on our finances. Thank you, Sean.

Chris Ogden: Throughout 2024, we remain disciplined in our capital allocation. With a focus on progressing our clinical pipeline for the initial Phase one data. Entering 2025, we are now positioned to achieve initial data readouts for CX-2051 and CX-801. As Sean highlighted earlier, in January of this year, we made a focused set of trade-offs that extend our cash runway and direct capital primarily to our lead programs CX-2051, and CX-801. So now I’ll turn to our 2024 financial results. As of December 31, 2024, we ended the year with $100.6 million in cash, cash equivalents, and investments. Compared to $174.5 million in cash at the end of 2023. With our prioritization efforts, we expect that our cash balance will continue to fund CytomX Therapeutics, Inc.

operations into the second quarter of 2026. Consistent with our prior approach to cash runway guidance, our cash guidance does not assume any additional milestones from existing collaborations. Or any new business development. Which we have a strong track record of achieving. As Sean mentioned earlier, we recently achieved a $5 million milestone in our Stellus T cell engager collaboration, and we are funded to continue to execute programs under our research alliances. Turning to revenue and operating expenses for the year. Total revenue was $138.1 million compared to $101.2 million for the corresponding period in 2023. Increased revenue was attributed to our BMS collaboration as well as our collaborations with Moderna, Estella, and Regeneron.

Total operating expenses for the full year were $113.1 million compared to $107.7 million in 2023. 2024 operating expenses increased $5.4 million primarily due to a $5 million milestone payment to AbbVie, for initiation of phase one for CX-2051. Excluding this milestone, operating expenses were essentially flat to 2023. R and D increased by $5.7 million from last year to $83.4 million in 2024. Also driven by the milestone payment for CX-2051 Phase one start. G and A expenses were essentially flat during 2024, decreasing by $0.3 million to $29.7 million for the year ended December 31, 2024. We remain committed to disciplined capital allocation and resource management. And we believe we are well positioned to progress our promising pipeline, deliver value to shareholders, and, ultimately, bring new treatment options to cancer patients.

With that, I’ll turn the call back to Sean for closing remarks.

Sean McCarthy: Thanks, Chris, and thanks everyone for joining us today. We look forward to sharing additional updates in the coming months including the first look at how CX-2051 is performing in colorectal cancer. To close out, I want to recognize and sincerely thank the patients who join our studies, their families, our clinical investigators, and our dedicated team here at CytomX Therapeutics, Inc. We’ve never been more committed to our vision, mission, and values at CytomX Therapeutics, Inc., so we look forward to an exciting year ahead. With that operator, let’s go ahead and open up the call for Q and A.

Q&A Session

Operator: To ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, press one one again. Please standby while we compile the Q and A roster. Our first question comes from Roger Song with Jefferies. Your line is open.

Roger Song: Great. Thanks for taking the question. Maybe just one related to 2051. So given your enrolling patient progressing, and then how should we think about the first half date update in terms of patient number and then what kind of data we’re gonna show, what’s the expectation for the data readout for the first half. Yeah. Hi, Roger. Thanks for the question.

Sean McCarthy: Well, we’re expecting it to be a meaningful update. We do anticipate this initial look will include an initial characterization of the safety profile of the drug, up to and including doses as we said that we are predicting based on our preclinical work in the therapeutically active range. We’ve been pleased with the escalation so far given the prior history with other systemic EPCAM strategies having hit roadblocks very early in dose escalation. So you know, so from that standpoint, so far so good. Of course, this initial update will all will will will first update first presentation of data will include an initial assessment of antitumor activity across these first few cohorts, and, you know, that activity data could take the form of pharmacodynamic markers, tumor stabilization, of course, potentially tumor shrinkage, and, of course, if we see anything approximating or equivalent to resist responses in this very late line CRC patient population, we would be absolutely thrilled.

Roger Song: Yep. Got it. And then in terms of the a o one, I You will give us some update in second half, and then also you will move you say you were moving to the Pembroke combination. So how should we think about the timing and then criteria moving to the Pembro before or after you give us the Did update. Thank you.

Sean McCarthy: Yes. Great question. So as I mentioned, as we’re twenty fifty one, you know, we’ve been pleased with the operational execution in the eight zero one study so far having really just started that, that phase one study and already now being in the fourth dose level and the the starting dose was pretty decent, and that’s allowed us to go pretty quickly to now be treating patients with doses that are higher than than the approved dose So unmasked into parenthesis. So so that’s that’s encouraging. And because we’ve been able to quickly go through those initial cohorts, we do see the the potential to those those first two dose levels we do see the potential to initiate the KEYTRUDA combo in second half. If if I had to guess, I’d say that the sequencing would be the combo initiation would proceed any data presentation, but we do remain on track.

Based on our ongoing translational work looking at tumor biopsies to to be sharing some initial data by the end of the year.

Roger Song: Excellent. You.

Sean McCarthy: You’re welcome.

Operator: Thank you. Our next question comes from Joe Catanzaro with Piper Sandler. Your line is open. Great. Hey, everybody. Thanks for taking my question. Maybe a couple on two thousand and fifty one. So I think you’ve been saying for a little while now that you’ve entered therapeutically active doses based on preclinical data. Today, you’re saying you’re in the seventh dose cohort. So wondering how many of those seven dose cohorts sort of fall into that category of predicted to be within therapeutic the active doses. I guess I’m just trying to get a sense of sort of what percent in this initial disclosure will fall within that that category. Thanks.

Sean McCarthy: Yeah. Hi. Hi, Joe. So the the first couple of cohorts as we’ve disclosed previously were single patient doses single patient cohorts, excuse me, at doses that we would predict to be outside of the therapeutic active range. But entering dose level three, we would predict Again, based on the animal modeling that and based on what’s generally known about Topo one ADCs, that we will be starting to get into that range and, of course, that would increase as we’ve we’ve continued the escalation. So I think a significant number of patients by the time we’re ready to share data we’ll have been treated with doses in in that range. Of course, I wanna emphasize again that this is a a late line patient population We’re enrolling predominantly patients who have had at least three prior lines of systemic therapy. And, you know, so we think the the the the bar is fairly low here for actual clinical activity.

Joe Catanzaro: Okay. Great. And then maybe a maybe a follow-up. So you noted not enrolling. Based on KRAS status or or LiverMed. So so I’m wondering if any expectations whatsoever potentially seeing differential activity as it relates to some of those features like KRAS status or presence, absence of liver meds or or maybe even anything else that you’re thinking of. Thanks.

Sean McCarthy: Yeah. There’s there’s no obvious there’s no obvious biology you know, that would you know, suggest that ATCAM well, let me start by saying, ATCAM expression or just reiterating that Atcam expression is high in more than ninety percent of CRC patients. And, yeah, we’ve validated that with our our own work, and we’re measuring EPCAM levels, of course, in every patient that we treat. So, we’ll have that data for this study. There’s no reason to suggest that there’s a connection between KRAS mutational status a Netcam, or LiverMax and Netcam. It’s it it the point we’re making is that, we’re enrolling the full patient population this time to characterize the drug across the full CRC population. And we’ll we’ll see what we get. I mean, if if it turns out that we get, you know, data that suggests that suggest that the drug is more suited to a particular subset then we may investigate that. But at this point, we’re we’re enrolling a broad patient population.

Joe Catanzaro: Okay. Got it. That’s helpful. Thanks for taking my questions. Okay.

Sean McCarthy: You’re welcome.

Operator: Thank you. Our next question comes from Anupam Rama with JPMorgan. Your line is open.

Priyanka: Hi, guys. This is Priyanka on for Anupam Just kind of following up on the previous line of questions. Since we enrolled patients in the CX two thousand and fifty one phase one trial, it’s not being preselected for AbbViec expression. Is there published literature, for example, to help guide what level expression would be beneficial?

Sean McCarthy: Yes. There’s a there’s a broad literature on f chem expression across most tumors including colorectal, and I think it’s Well established that EPKAM is is highly expressed in this tumor type. In fact, EPCAM was first described as a colorectal cancer marker, a very long time ago, actually. So, yes, I think it’s pretty well established that CRC is a high account exporter in most most patients, and I I I anticipate that our clinical results will will will validate that.

Priyanka: So much for taking my question.

Sean McCarthy: You’re welcome.

Operator: Thank you. Our next question comes from Peter Lawson with Barclays. Your line is open. Great.

Peter Lawson: You so much. Thanks for taking the questions. Just on the prior authorization of CRC for your EPCAM, Eighty c. Is that driven by the expression levels you kinda talked about and just kinda well known within the space. So you’ve already seen signals there. And also seen any signals outside CLC to date?

Sean McCarthy: Yeah. Hi, Peter. That’s helpful to help me help me clarify and and reiterate that this phase one study of two zero five one is being conducted entirely in the CRC setting. So we’re only enrolling metastatic CRC patients. And as I mentioned, patients who have been treated the the the patient population that we’re that we’re seeing, that we’re we’re treating are for the most part, have have, for the most part, been treated with three at least three prior lines of of systemic therapy. So so the question is, okay. Why why focus in CRC? There’s several answers to that. First of all, when you just look at EPCAM biology and the the target itself, CRC is really the indication that jumps out as, you know, with the highest broadest, most consistent, most, homogeneous expression from patient to patient.

And as I said, it’s actually where where EDCAM was first described as a tumor marker. That that said, EDCAM is highly expressed in in most other solid tumors. So this is a you know, pipeline, you know, product opportunity in the long run if we see a signal in CRC. There’s no question about that. The other the other reason to select CRC is, you know, the unmet need the unmet need is just is is just huge. And so, you know, a scenario where Patients need new treatments. They’ve been waiting for them for decades. And we’re we’re trying to make a difference here. And then the third is that this drug this drug candidate with a TOPO one inhibitor was was really always designed with colorectal cancer in mind is the first place to go because you know, there’s not much There’s been it’s kind of a wide open field.

The ABCs in colorectal cancer And we know that CRC responds to topo one inhibition As I mentioned in my prepared remarks, Erwinatecham is component of standard of care therapy in the first and or second line on a global basis is quite effective. In the earliest stage of treatment of CRC. So we’re you know, we know that CRC can respond to open one inhibition. So we think, for this particular program, we think the combination of the tumor type of interest the target selection, and the effector mechanism, the payload, has really been optimized and delivers, you know, I think compared to some of our prior work. With ADC’s a higher overall probability of technical success. Just again to be really clear that if we if we are fortunate enough to see a signal, in in CRC, then that would ungate many other tumor types that are known to be responsive to topo-one inhibition that also express EPCAM at high levels.

Gotcha. Okay. Thank you. And then Just that. As as we think about as you move forwards, kind of what’s what’s the real bar for success? And, you know, are you thinking is it third line, fourth line, CRC? Well, in the fourth line, unfortunately, for patients, the bar is the bar is low. I mean, you got response rates in the single digits to drugs like Lonser, Flonser, if even in combination with bepizumab, fluconib, regarafenib, with just a few months of PFS. And so this is a very underserved highly underserved patient population in the fourth line It’s also you know, what what we hear from our and investigators and and KOLs is that even in the third line setting, their current standard of care, which is which is is for the most part, bev long serve, is is also highly inadequate and it’s so inadequate that many, many patients in the third line setting goes go on to trials or being held on therapy there as as a as a precursor to going on to trials.

And so I think that really underscores number one, how how high the unmet need is and and really how low the bar is Obviously, we we have high ambitions for this drug, but we think for this initial look, in this late stage patient population, we think quite frankly, any evidence of resist responses would would be a real win. Gotcha. And so that initial look at that phase one eight data, Do you wanna see tumor shrinkage? What’s what what’s the bar there you think So success in your mind.

Sean McCarthy: Yeah. As I as I as I already mentioned, I think we’re looking at a number of things. We’re looking at you know, evidence of you know, pharmacodynamic activity in tumor biopsies evidence of tumor stabilization because, you know, CRC approvals those drugs I mentioned earlier on that have been approved in the third line setting, third and or fourth line, for the most part, have been approved based on On PFS, type measures because it’s very difficult achieve objective responses in this patient population. So if you can keep patients from progressing, that in and of itself is a is a success. So evidence of tumor stabilization, evidence of tumor shrinkage, and then, of course, you know, the the the the holy grail for us in this study is if we can see in this early first look in this late line patient population is to see if we can deliver objective resist responses. Perfect. Thank you so much. Thanks for taking the questions.

Operator: Thank you. As a reminder, to ask a question, please press star one one on your telephone. Again, that is star one one to ask a question. Our next question comes from Mitchell Kapoor with H. C. Wainwright. Your line is open.

Dan: Good afternoon. This is Dan on for Mitchell. Thanks for taking our questions. We wanted to ask where you might present the Phase 1a CRC data Would this likely be a press release event, any lean towards first quarter or second quarter, And then jumping on the therapeutic active range kind of discussion, many more dose levels do you plan to test, and where does the seventh dose level compare to the nonhuman primate clinical talks. Thank you.

Sean McCarthy: Yeah. Thanks for the questions. In terms of where to present We’re keeping our options open there. So we’ll provide further guidance in due in due course. In terms of the you know, the escalation, The the the second and third questions are, of course, connected. The escalation into the seventh dose level, obviously, if we clear that dose level, we’ll continue to we’ll continue to escalate. We’ll have to we’ll have to see how that goes. At this point, That’s where we are, and we’ll we’ll we’ll have to see. I I would say that the the the you know, when we talk about predictive active range of the drug, that is Based on modeling, that is including our experience from mouse and cinemologist monkey experiments, together with understanding in general of other topa one ADCs and what experience others have had in the clinic with with this type of Thank you.

Dan: You’re welcome.

Operator: Thank you. I’m not showing any further questions in the queue. I would now like to turn it back over to Dr. Sean McCarthy, Chairman and CEO, for closing remarks.

Sean McCarthy: Well, thanks everyone for joining us today. We look forward to providing additional updates throughout the year and hope you all have a good rest of the day.

Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.