Affimed - Q3 2022
November 15, 2022
Transcript
Operator (participant)
Thank you for standing by. Welcome to today's third quarter earnings and business update conference call by Affimed N.V. As a reminder, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. Please note this conference call is being recorded. I would now like to hand the call over to your host for today, Alexander Fudukidis, Director of Investor Relations at Affimed. Please go ahead.
Alexander Fudukidis (Director of Investor Relations)
Thank you, Shannon, and thank you all for joining us for our call today. Before we begin, I'd like to remind everyone that we issued the relevant press release earlier today, which can be found on the investor relations section of our website. On the call today, we have members of our management team, including Adi Hoess, our Chief Executive Officer, Andreas Harstrick, our Chief Medical Officer, Arndt Schottelius, our Chief Scientific Officer, Wolfgang Fischer, our Chief Operating Officer, Denise Mueller, our Chief Business Officer, and Angus Smith, our Chief Financial Officer. The team will be available for Q&A after the prepared remarks. Before we start, I'd 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 statement, 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 Adi. Adi?
Adi Hoess (CEO)
Thanks, Alex. Good day, everyone, and thanks for joining us for the third quarter update call. Let me start with the most important update that we announced earlier this month. As we are showing on slide four, after an extensive evaluation of the available options, on November third, we announced a new collaboration with Artiva. Building on our already established relationship to take the combination treatment of AFM13 and Artiva's cryopreserved off-the-shelf cord blood-derived NK-cell product candidate called AB101 forward quickly. For us, this collaboration is a natural evolution of the AFM13 plus NK-cell program as we move this therapy from an early stage into late-stage development and begin to position the combination for commercial success. According to our analysis, this partnership represents the fastest option to make this combination therapy available to patients. We are convinced that we made the right choice for AFM13.
Now, through this collaboration, we have gained access to a highly active NK-cell product. As shown on slide five, we've generated preclinical data showing the highly synergistic antitumor activity of the combination of AFM13 with AB101. Overall, based on the preclinical data generated, as well as our previous experience of administering AFM13 with a cord blood-derived NK-cell product in our AFM13-104 study, we're confident that AFM13 administered in combination with AB101 has the potential to generate a robust ADCC response and clinical activity in patients with relapsed or refractory Hodgkin lymphoma and CD30-positive peripheral T-cell lymphoma. Other factors were considered when selecting AB101, and this included the fact that AB101 is already in clinical development with a cleared IND and is a cryopreserved off-the-shelf product. It demonstrates consistent and high CD16A expression.
A GMP-grade manufacturing site with the right scale for clinical trials and future commercialization is available, and the product has viable cost structure. Moving to slide six. It shows that the terms of the deal with Artiva allow us to accelerate the development of the combination therapy now by leveraging the financial resources of the two companies. Affimed will initially pay for the clinical trial cost of the phase II study, and Artiva will supply AB101 and IL-2 for the study at their cost. Cost of any confirmatory study will be shared 50/50. Revenues will be shared with Affimed now receiving 67% of the revenues of the combination therapy. In our efforts to move forward quickly, we're also making progress on the regulatory front.
We already requested a pre-IND meeting with the FDA in early September, and the agency has indicated that they will provide feedback to us by the first quarter of 2023. This is a little later than the usual 60 days, which the agency has informed us is caused by a significant backlog due to COVID. Still, our goal is to submit an IND for the combination study in the H1 of 2023 and begin the clinical study later in the year. We believe that we'll be able to move into the clinic quickly because of the robust clinical and pre-clinical data that has been generated for each product on its own. The pre-clinical data that we have collected from our over two-year collaboration and the very good safety profile that we have seen in our combination study with AFM-13 and cord blood-derived allogeneic NK cells.
As you can appreciate, we are at a very exciting point in the development of our company. In addition to the data and business updates we provided in the last few weeks, we are preparing to announce key catalysts that could have a meaningful impact for our company and the patients we serve. These include top-line data from the phase II REDIRECT study of AFM-13 in peripheral T-cell lymphoma in mid-December, and data from the combination of AFM-13 with NK cells at ASH. Now, to tell you more about our clinical programs and some of our recent data, I'll hand over the call to Andreas. Andreas?
Andreas Harstrick (Chief Medical Officer)
Yeah. Thank you, Adi, and also a warm welcome from my side to everybody on the call. I would like to take the opportunity and provide an update on our clinical programs and the progress that we have achieved. Let us start with our AFM-13 program on slide nine. Our registration-directed monotherapy study of AFM-13 in relapsed and refractory peripheral T-cell lymphoma, also known as REDIRECT, has completed enrollment earlier that year. As previously communicated, we expect to report data from the study in mid-December. The study has enrolled more than 100 patients with relapsed or refractory CD30-positive peripheral T-cell lymphoma.
The focus of the initial data release will be on the overall response rate, as assessed by a blinded independent review committee, which is the primary endpoint of the study, and a preliminary assessment of the duration of responses, as well as an analysis of safety. As a reminder, peripheral T-cell lymphoma is a disease with still significant unmet medical need. In our estimates, there are about 1,500 patients in the U.S. alone with relapsed/refractory PTCL, and treatment options remain very limited, and the prognosis for these patients is poor. As also previously communicated, we plan to initiate discussions with the FDA following our analysis of the data.
The second AFM13 study that is ongoing is our phase I, II study, AFM13-104, in collaboration with MD Anderson Cancer Center, evaluating cord blood-derived natural killer cells, pre-complexed with AFM13, given as one infusion, followed by three single-agent AFM13 treatments in patients with relapsed and refractory CD30-positive lymphomas. On slide 10, you can see the highlights from the ASH abstract from a couple of weeks ago. We showed that as of July 31, the cutoff date for the analysis that provided data for the abstract, 24 patients have been treated at the highest NK cell dose of 1 × 10^8 NK cells per kilogram body weight. This represents an increase of 11 patients since the data reported at AACR earlier this year.
To highlight, the overall response rate at this dose has been maintained at 100%, and the complete response rate increased to 70.8%. An improvement over the 61.5% CR rate, as reported earlier this year at AACR. As announced in our press release, Dr. Yago Nieto, professor of stem cell transplantation and cellular therapy at The University of Texas MD Anderson Cancer Center, and principal investigator of the study, will provide an update from the ongoing phase II trial at ASH on December 10. Now let's turn to AFM-24. As you can see on slide 11, we show that we are continuing to enroll patients in all three ongoing studies, including the expansion cohorts of our monotherapy study and the dose escalation cohorts for the combination studies with atezolizumab and SNK-01, the autologous NK cell product from NKGen, respectively.
In the AFM-24 monotherapy trial, we are continuing to enroll patients in the expansion phase at the recommended phase II dose of 480 milligrams weekly. The expansion cohorts include patients with renal cell carcinoma, non-small cell lung cancer with activating EGFR mutations, and colorectal cancer which are KRAS wild-type. In the combination studies, we are continuing to enroll patients in the dose escalation phases of the two studies. As a quick reminder, the primary purpose of the dose escalation phase of these studies is to establish the safety of the two combinations and identify the recommended phase II dose for further testing.
In AFM24-102, the combination study of AFM24 given weekly with atezolizumab at the recommended phase II, the recommended dose given every two weeks, we are enrolling patients with non-small cell lung cancer, which are EGFR wild-type, gastric or gastroesophageal junction adenocarcinoma, and pancreatic hepatocellular and biliary tract cancers. We completed the first dose escalation cohort of 160 milligrams weekly of AFM24 without any dose-limiting toxicities. Furthermore, the first three patients at the 480 milligram dose have now been enrolled and completed their dose-limiting toxicity period without DLTs. According to protocol, we are enrolling additional three patients at this dose to confirm 480 milligram as the recommended phase II dose for this combination. The second combination study, AFM24-103, is investigating the combination of AFM24 with SNK01, the ex vivo expanded and activated autologous NK cell therapy from NKGen Biotech.
In this study, both agent AFM24 and NK cells are given weekly to patients with non-small cell lung cancer, EGFR wild-type, squamous cell carcinoma of the head and neck, and colorectal cancer. In this study, we have completed the first dose escalation cohort, which treated patients at 160 milligrams of AFM24 with no dose-limiting toxicities. We are currently enrolling patients at the 480 milligram dose of AFM24. On slide 12, we are showing a summary of two presentations that were presented at SITC Immunotherapy Congress last week. For the monotherapy study, correlative science data from the dose escalation portion of the study provided interesting insights into the mechanism of action of AFM13. Findings showed that starting at low doses of AFM24, NK cell activation could be seen in the peripheral blood.
CD16A receptor occupancy also increased in a dose-dependent manner at lower doses, but leveled off at a dose of 320 milligrams and above, indicating that at this dose, receptor occupancy was saturated. We could also demonstrate activation of cytotoxic T cells in the periphery, pointing to a simultaneous activation of the adaptive and the innate immune system. Furthermore, when we looked into tumor biopsies by immunohistochemistry and gene expression profiling, translating the findings from the peripheral blood to the tumor, we saw that NK cells and cytotoxic T cells increased in the biopsies of AFM24-treated patients, indicating that cytotoxic cell function of both NK and T cells are increasing significantly. These data demonstrate that AFM24 activates the innate and the adaptive immune system in the periphery and in the tumor microenvironment, and paves the way for combinations with checkpoint inhibitors and NK cells.
This brings me to the combination study with atezolizumab, the phase I dose escalation in the phase I dose escalation study. Here we showed that clinical activity was observed in two patients in the first dose escalation cohort of 160 milligrams of AFM24 weekly. As you can see on the slide, one of the patients was a patient with gastric cancer. This patient had already been treated with pembrolizumab and chemotherapy combination in first-line, followed by three lines of various chemotherapy regimens before included into the trial. Importantly, to the pembrolizumab chemotherapy combination in first line, the patient had only achieved a very short-lasting partial response, which was followed by progression of metastasis while still on pembrolizumab treatment. It is important to note that this represents a patient profile where a response to single-agent PD-1 re-challenge is very unlikely.
The second patient, a patient with pancreatic adenocarcinoma, exhibited stable disease on the combination of AFM24 plus atezolizumab after showing progressive disease on three different previous chemotherapy regimens. We expect to submit data from all three AFM24 studies to major scientific conferences in the second and third quarter of 2023. On slide 13, for AFM28, we announced an abstract at ASH, which will describe the preclinical in vitro models using a panel of AML lines showing efficacy and antibody-dependent NK-cell-mediated cytotoxicity against CD123-positive tumor cells by a combination of allogeneic NK cells and AFM28. This combination induced highly potent and selective lysis of CD123-positive leukemia cells and induced cytotoxicity against leukemic stem cells and progenitor cells.
We believe that this is an important finding as the ability to eradicate leukemic stem cells is associated with durable responses and the potential for long-term remissions in patients with refractory or relapsed AML. Given the aggressive nature of the disease and the need for viable treatment options, the AFM24 and AFM28 program is of high priority for Affimed, and we remain committed to being able to offer these treatment options for relapsed and refractory AML patients as quickly as possible. Accordingly, we moved quickly to file clinical trial applications in a number of European countries, with Spain and France leading the way. Additional filings in different jurisdictions are expected in the next few months. With that, I will turn the call over to Angus to update you on the quarterly financial numbers. Angus, please.
Angus Smith (CFO)
Thank you, Andreas. Balance sheet and income statement highlights are shown on slides 15 and 16 of the presentation. Affimed's consolidated financial statements have been prepared in accordance with the IFRS, as issued by the International Accounting Standards Board, or IASB. The consolidated financial statements are prepared in euros, which is the company's functional and presentation currency. Therefore, all financial numbers that I'll present in this call, unless otherwise noted, will be in euros. As of September 30, 2022, cash and cash equivalents total EUR 222.9 million compared to EUR 197.6 million on December 31, 2021. Based on our current operating plan and assumptions, we anticipate that our cash and cash equivalents will support operations into mid-2024.
Net cash used in operating activities for the quarter ended September 30, 2022 was EUR 19 million, compared to EUR 25.6 million for the quarter ended September 30, 2021. Total revenue for the quarter ended September 30, 2022 was EUR 14.9 million, compared with EUR 18.7 million for the quarter ended September 30, 2021. Revenue predominantly relates to the Genentech and Roivant collaborations. Research and development expenses increased by 27% from EUR 20.6 million for the quarter ended September 30, 2021 to EUR 26.1 million for the quarter ended September 30, 2022.
The increase was primarily due to higher expenses associated with the development of the AFM13 and AFM24 programs, a result of an increase in procurement of pre-clinical trial material, clinical patient trial costs and manufacturing costs, and increase in costs associated with other early-stage programs and infrastructure, and an increase in share-based payment expense. G&A expense increased 19% from EUR 6.8 million in the quarter ended September thirtieth, 2021 to EUR 8.1 million in the quarter ended September thirtieth, 2022. The increase predominantly relates to higher personnel and share-based payment expenses and an increase in insurance premiums and higher consulting costs. Net finance income increased from EUR 1.5 million for the quarter ended September thirtieth, 2021 to EUR 2.7 million for the quarter ended September thirtieth, 2022.
Net finance income is largely due to foreign exchange gains related to assets denominated in U.S. dollars as a result of currency fluctuations between the U.S. dollar and the euro during the year. Net loss for the quarter ended September thirtieth, 2022 was EUR 16.5 million or EUR 0.11 per common share, compared with a net loss of EUR 17.1 million or EUR 0.14 per common share for the quarter ended September 30, 2021. The weighted number of common shares outstanding for the quarter ended September 30, 2022 was 149.3 million. Additional information regarding these results is included in the notes to the consolidated financial statements as of September thirtieth, 2022, which will be included in Affimed's filings with the U.S. Securities and Exchange Commission. I will now turn the call back to Adi for closing remarks.
Adi?
Adi Hoess (CEO)
Thank you, Angus. Now, as you've seen, our most advanced program is called AFM-13, and it's validating our three-pronged approach and has shown very good safety profile with broad activity. Now, if everything works out as planned, we expect to take the drug forward as monotherapy as well as in combination with natural killer cells, which could create significant value for patients and investors. As shown on slide 18, with monotherapy and NK cell combinations, we can initially address the needs of about 3,500 patients in the U.S. only, and indeed, far more when developed in the E.U. and Japan, with relapsed and refractory CD30-positive Hodgkin and peripheral T-cell lymphoma.
We can even expand beyond to address about 7,500 patients. Now, again, just in the U.S. only, again, it will be more in Europe, Japan, by moving to earlier lines. Considering the likely value base on current data of the AFM13 in case of therapy to patients and the payer feedback, we believe we can make AFM13 a major commercial opportunity for our company. Now, through the partnership with Artiva, we've achieved a major milestone that enables us to pursue this substantial market opportunity. As you have heard, in parallel, AFM24 is moving forward in all three studies, indeed addressing multiple major solid tumor indications. Important, overall, the safety of AFM24 as monotherapy and in combination looks quite favorable, which now allows us to treat patients at the 480 milligram dose across all three studies.
The first data of AFM24 in combination with Atezo presented at SITC is highly encouraging, and as shown on slide 19, we are on track to provide additional data updates throughout 2023 at major medical conference. Our pipeline is further enhanced through AFM28, which is in the filing stage for a clinical phase I study outside the U.S. Also, our ongoing partnerships are moving forward. In the case of Genentech, we have made good progress in various pre-clinical programs and handed over several programs to them for further pre-clinical development. In our second collaboration, Roivant just presented a poster at SITC, which showed that AFM32 represents a novel approach to treating folate receptor alpha expressing tumors by engaging the innate immune response for safe and effective tumor cell kill. Roivant announced that it is expecting to enter into phase I clinical trials in 2023.
We're therefore eligible for additional proceeds from these key collaborations in the near term, including pre-clinical milestones as well as milestones based on early regulatory achievements. With this, I'd like to thank you all for your continued support, the patients and their families, and for our employees in the U.S. and Europe who are continuing to do the best they can in supporting our efforts to move things forward. We are now ready to take questions. Operator.
Operator (participant)
Thank you. To ask a question, you will need to press star one one on your telephone. In the interest of time, we ask that you please limit yourself to one question and one follow-up to permit time for others to ask. Please stand by while we compile the Q&A roster. Our first question comes from the line of Kripa Devarakonda with Truist. Your line is now open.
Kripa Devarakonda (VP of Biotechnology Equity Research)
Hey, guys. Thank you so much for taking my questions and, congratulations on the poster presentations at SITC. The AFM24 PD-L1 poster that you presented, the patient where you quoted a PR in gastric cancer, it's clear from the poster the impact on the cutaneous lesions. Can you tell a little bit, sorry if I missed it, about the impact on the primary tumor itself? Also it looks like you continue to see a reduction in lesions with multiple doses. Can you remind me how long these patients are expected to be treated at the dose? Thank you.
Adi Hoess (CEO)
Andreas, please.
Andreas Harstrick (Chief Medical Officer)
Yeah, I can take this. The patient's manifestation was mainly skin metastases, which were, as you have seen on the poster, quite bulky. The patient also had a primary tumor, which was in the gastric wall. However, due to the difficulty to really objectively measure a thickening of the gastric wall, this lesion was more regarded as an evaluable lesion, but not as a real measurable lesion. We also saw some reduction in the gastric wall, again, with a limitation that it's very difficult to measure. Again, a major reduction of the skin metastasis, which represented the vast bulk of the tumor load in this patient. In terms of duration of treatment, the protocol is designed that we can continue treatment as long as the patient derives clinical benefit.
There is no upper limit of possible cycles that can be given.
Kripa Devarakonda (VP of Biotechnology Equity Research)
Got it. Thank you so much.
Operator (participant)
Thank you. Our next question comes from the line of Maury Raycroft with Jefferies. Your line is now open.
Maury Raycroft (Equity Research Analyst)
Hi. Congrats on the progress, and thanks for taking my question. Just wanted to check on regulatory path going forward for AFM-13 and PTCL. Given some of the regulatory updates with other oncology companies in the space as it relates to accelerated approval paths and confirmatory studies, can you talk about your plan for PTCL based on the REDIRECT study and FDA feedback that gives you confidence around your accelerated approval path?
Adi Hoess (CEO)
Wolfgang, can you take this question?
Wolfgang Fischer (COO)
Yes, sure. Hi, Mary, this is Wolfgang. Once we will have the data, we will consult with the FDA discussing the path forward, right? Because currently we do not know what the data look like. This will also include a registration-directed study. Yes, we are aware that the FDA is also talking to other companies, right? We just heard last week or the week before about that company and that they are requesting that a confirmatory study is underway. However, we do not know what other factors have been considered here, right? We think we go with our data and discuss with the FDA.
Maury Raycroft (Equity Research Analyst)
Got it. That makes sense. Maybe one follow-up, just, for AFM28, if you do the dose escalation in Europe or start looking at combinations in the EU, how do you eventually plan to pivot back to development in the United States?
Wolfgang Fischer (COO)
Andreas?
Andreas Harstrick (Chief Medical Officer)
Yeah, I think we generate initial data, initial safety data as we have announced in the European jurisdictions. Now the requirement for FDA to use foreign data is that the patient population and treatment algorithms should represent the standard of care and the usual population in the U.S. I think both factors are given by the selection of the countries that we have, as I mentioned, Spain and France will lead the way. I think as soon as we have cleared initial dose cohorts and have demonstrated also the clinical safety of the program, we should be able to revert back to the U.S. and then embark onto a global development program that will include U.S. as well as Europe.
Maury Raycroft (Equity Research Analyst)
Okay. Thanks for taking my questions.
Operator (participant)
Thank you. Our next question comes from the line of Daina Graybosch with SVB Securities. She'll un-mute now and
Daina Graybosch (Managing Director and Senior Biotechnology Analyst)
Yes. I want to ask a question about the AFM24 response in gastric cancer. The cutaneous lesions are obviously a very clear response, and I wonder if there's something about cutaneous lesions and the mechanism of targeting EGFR that's notable. Of the other cancers that you're going for, if there's any similarity, either in the monotherapy, PD-1 or NK cell combinations, with manifestations of cutaneous lesions. Thank you.
Wolfgang Fischer (COO)
Thanks, Daina. Andreas?
Andreas Harstrick (Chief Medical Officer)
Yeah. Thank you for the interesting question. I mean, this patient, as you have seen, happened to have skin metastasis. Skin, of course, is an area where you have a high EGFR expression. Now, biologically, we think this is not connected as the EGFR expression would be limited, the high EGFR would be limited to the normal keratinocytes, the normal cells. The gastric cells still maintain their EGFR expression pattern that they have in the primary tumor. To my knowledge, there's no indication that EGFR on tumor cells is upregulated when they home into the skin.
As we announced previously, we have conducted a very specific and very detailed analysis of the tumor microenvironment of a number of very different tumor histologies, which formed the basis for selecting certain indications for monotherapy, for combination with PD-1, and for combination with NK cells. Skin metastasis or the likelihood of skin metastasis was not part of the consideration. Again, we believe, and then most biological data show that tumor cells, irrespective to where they metastasize, will maintain their biological fingerprint or footprint. Therefore, I think a gastric cancer cell that homes to the skin is biologically not very different from a gastric cancer cell that may go to the liver or to the bone or other more frequent metastasis locations.
Daina Graybosch (Managing Director and Senior Biotechnology Analyst)
Can I have a follow-up? I mean, do you see any impact potentially, you know, other companies will target normal or stromal cells around the tumor, let's say with SAP. Do you see any indication that other cells in the tumor microenvironment or surrounding normal could have an impact in your sort of mirroring an in vitro model?
Andreas Harstrick (Chief Medical Officer)
I think for the in vitro models, I could hand over to Arndt. I think clinically, again, the NK cell reactivity is very specific to the cell where the NK cell attaches to and then to the microenvironment. I would not see a difference between skin locations of tumor cells or other locations. Arndt, maybe you can take the
Arndt Schottelius (Chief Scientific Officer)
Yeah.
Andreas Harstrick (Chief Medical Officer)
In vitro question.
Arndt Schottelius (Chief Scientific Officer)
Yeah. Daina, let me see if I got the question correctly. I mean, if you talk about cells in the vicinity, in the tumor microenvironment, of course, what we know and, you know, we talk a lot about NK cells, of course, we have also quite clear growing data on macrophages. Of course, in terms of attempts, they will be recruited. We don't have evidence for other neighboring cells. Of course, the bulk of the data is for the NK cells. As Andreas pointed out, these indications have also been carefully selected to see that, you know, the innate immune system is accessible or actually the cells of the innate immune systems are there.
I mean, above, we have also seen, as Andreas described in the talk that, the SITC poster, we do see the activation of the innate and the adaptive immune system, which we think is a very natural, physiological way to get both systems going in the, immuno-oncology cycle. In a much more, in a way, a natural way, getting adaptive immune cells in there as well. Not sure if that answers your question, but we'll be, you know, happy to do follow-ups also.
Daina Graybosch (Managing Director and Senior Biotechnology Analyst)
No, that's good. Thank you.
Operator (participant)
Thank you. Our next question comes from the line of Do Kim with Piper Sandler. Your line is now open.
Do Kim (Managing Director and Senior Research Analyst)
Hi, thanks for taking my question. I also had a question on the AFM24 atezo poster that you presented at SITC. In the patient who had the partial response in gastric cancer, knowing that the patient failed pembro prior, do you think atezo is contributing to the antitumor activity? Does this partial response change how you think about the monotherapy or give you more confidence in advancing that monotherapy study?
Adi Hoess (CEO)
Andreas?
Andreas Harstrick (Chief Medical Officer)
Yeah. Let's start with the pembrolizumab, atezolizumab question. Again, the literature is quite limited. We have not found meaningful data for gastric carcinoma. Most of the experience really comes from retreatment attempts with PD-1, PD-L1 in patients with non-small cell lung cancer. If you look across the literature, what you see is that a response is possible to PD-1 rechallenge, but these responses are largely limited to patients who have either stopped pembrolizumab or any PD-1 inhibitor while still in a response, or who had to stop temporarily because of immune-related adverse events. If you look at patients who have a demonstrated progression while receiving PD-1, especially when this PD-1 was also given in combination with chemotherapy, the response rates of PD-1 rechallenge are extremely low, and in many studies are 0%.
We do not think that this patient belongs to a patient group that would have responded to PD-1 rechallenge alone. We attribute this activity clearly to the combination of AFM24 and PD-1. As Arndt just said, I think this is also increasingly supported by our preclinical and clinical data now that we really show also in the patient an activation of the adaptive immune system. Now I have a long answer and forgot your second question. Could you repeat, please?
Do Kim (Managing Director and Senior Research Analyst)
Yeah. The second question was, does this response change how you think about monotherapy, or do you think that atezolizumab was important in getting to this partial response in the gastric patient?
Andreas Harstrick (Chief Medical Officer)
Well, for monotherapy, we are currently collecting the data. As we said, we will report initial data into a major scientific conference next year. Whether it really changes our belief, I think our belief from the get-go is that AFM24 is an extremely potent drug that can recruit NK cells, and as Arndt mentioned, can also very potently activate macrophages. Clearly the combination with a PD-1 or PD-L1 inhibitor is very promising. Again, we believe that there are certain tumor indications out there where the infiltration into the tumor microenvironment could be sufficient enough to support monotherapy activity. We will learn more as we are generating more data.
Again, for combination with any PD-1 inhibitor, this is now the second data point, in addition to the AFM13 studies that we have seen in combination with pembrolizumab, where we saw a significant increase in complete response rate and overall response rate. I think our combination with PD-1, PD-L1 inhibitors and ICE in general look extremely promising.
Do Kim (Managing Director and Senior Research Analyst)
Thank you. That was very helpful.
Operator (participant)
Thank you. Our next question comes from the line of Li Watsek with Cantor. Your line is now open.
Li Watsek (VP of Biotech Equity Research)
Thank you for taking my questions. Maybe just two from us. I guess first regarding maybe the confirmatory study of, you know, AFM13 plus AB-101 combo, I guess, is it sort of part of the discussions that you are having with FDA right now aside from the trial design of the potential phase II study? And then second is, you know, in terms of the site selection for the potential phase II trial of this combo, can you give us a sense of, you know, what parameters that you're looking for? Would the sites mostly be at the academic centers, perhaps with cell therapy experience, or are you looking at some community sites as well?
Adi Hoess (CEO)
Andreas, you wanna take this question?
Andreas Harstrick (Chief Medical Officer)
Let me start with the second question. When we are in terms of sites that we are anticipating to have on our combination trial, on our phase II trial, we are not limiting these sites to academic sites or sites with NK cell or cell therapy experience, simply based on our experience with the MD Anderson trial, which showed a remarkably good safety profile. In fact, most of the patients received their treatment on outpatient basis. Other than other CAR-T cell therapies like Yescarta, we do not think this is a treatment that will be restricted to academic centers. We believe that this can very well be given also in experienced community hospitals.
Adi Hoess (CEO)
Now, in terms of our discussions with FDA, as Adi mentioned, we have already submitted a pre-IND request, containing a lot of also clinical questions. This will be, of course, followed by an IND, and as we are planning to discuss with FDA an accelerated approval option and accelerated approval pathway for this treatment. Discussions of potential confirmatory studies, I think will be part of this interactions with FDA.
Li Watsek (VP of Biotech Equity Research)
Okay, thank you.
Operator (participant)
Thank you. Our next question comes from the line of James Shin with Wells Fargo. Your line is now open.
James Shin (VP of Equity Research)
Hey, good morning, guys. Thanks for taking my question. For AFM13-104, can you share whether you think the memory-like phenotype of the cells may be contributing to the response? And then secondly, given AB-101 will be co-administered, do you think the lack of IL-12, 15, and 18 poses somewhat of a uncertainty or risk of matching what you've seen in Hodgkin lymphoma?
Adi Hoess (CEO)
Yes. Thank you. I'll start here in terms of, we have obviously very intensely looked at, NK cells and the way how they are produced and, what we have learned from, in particular working with Artiva is they do have a pre-activation of a cell with cytokines as well. It's a little different to what MD Anderson does. Overall, from our internal experiments, we have very, we have seen almost no differences between different cell types. We have studied cells that are derived from the periphery, from cord blood, also, iPSCs, and, there was one key denominator that was truly important. It is the CD16A expression.
As long as these cells, when manufactured, express a significant level or a good level of CD16A, these cells synergize extremely well with our innate cell engagers. We have the high affinity to cover them in very high quantities. As you know, when this is established, you can't really wash it off, so it forms a stable complex, and then these cells become active. Our own learning's been that there has been very little differentiation among many different cell types with the one denominator that it expresses CD16A. The pre-activations that you were mentioning, we did not see an outstanding activity as compared to other cell types.
This is important, and that's what gave us great confidence that we indeed have a number of options where we wanted to partner with. Our option, basically our choice with Artiva has been because they are so far advanced in the manufacturing and that could indeed initiate a phase II clinical study fairly quickly with product that's very similar to the product that we eventually want to commercialize. That was important, and that's what Artiva is basically bringing to us in this partnership. Now, the other question I'll hand over to Arndt and see what he wants to add.
Arndt Schottelius (Chief Scientific Officer)
Let me see if I understand what the other question was. I think maybe referring to the James, the pre-clinical data that we have shared, and maybe most relevant, the mouse model and why this was not.
Adi Hoess (CEO)
Arndt, just to interrupt you quickly. It was about co-administration and pre-complexing. Sorry.
Arndt Schottelius (Chief Scientific Officer)
Yes. What we have seen, James, you know, and we shared that at the calls, and we have it summarized on one of the slides today. When we look in the CD30-positive Karpas cells and directly compared pre-complex and co-administration AB-101 with AFM13, we saw, yes, there was a slight better cytotoxicity with co-administration, but we see that in the same ballpark, very comparable. When we review again the mouse model that we did with co-administration, we see a very excellent tumor growth inhibition. Referencing back to your initial question, while that was not done side by side, a very similar results in a tumor, a total tumor growth abrogation as we had seen with the MD Anderson cells.
Overall, taken together in addition to what Adi already said, we really do not see a difference preclinically, thus feel very confident with moving forward with AB-101 in the co-administration setting.
Adi Hoess (CEO)
There are two additional data sets. One is published. It's that we can determine the receptor occupancy of AFM24 when infused as monotherapy. This shows that we can basically our innate cell engagers get to the NK cells in the body. This is a kind of not following the co-administration because here the patient is bringing the NK cells, but we can detect AFM24 binding to CD16A. That's our published data. That gives us, again, very good confidence. You know why we're seeing this strong binding. It's for several reasons. One is the very high affinity that our engagers have onto CD16A, plus they're binding an epitope that is not impacted by circulating IgG.
This is the advantages, and that's why we believe with co-administration, we can achieve a very solid binding of the NK cells that we infuse, in this case, AB-101. A second data set we have never published yet, but we have also looked at AFM13 in patients if it's binding to NK cells. Again, we can see AFM13 bound on patient's own NK cells. Those set of data give us a reasonably good basis to follow through with the strategy of co-administration. On top, we have generated obviously a multitude of pre-clinical data that confirms that pre-admin co-administration and pre-complexing results in in basically similar data and similar with similar activity.
James Shin (VP of Equity Research)
Thank you for the detailed response. Very much appreciated.
Operator (participant)
Thank you. As a reminder, to ask a question at this time, please press star one one on your touch tone telephone. Our next question comes from the line of Yale Jen with Laidlaw & Company. Your line is now open.
Yale Jen (Senior Managing Director and Senior Biotech Analyst)
Good morning, and thanks for taking the questions. I know you mentioned a lot of similarities between the MD Anderson and the Artiva's cells. Do you anticipate that as you go to speak with FDA, that could be some sort of bridging study needed before you move to the full phase II study for the potential accelerated approval?
Adi Hoess (CEO)
Wolfgang?
Wolfgang Fischer (COO)
Yeah. How the FDA looks at these differences, right? We can't say before we haven't talked to them, so that's important. We believe that we have a good data set showing the similarity comparability between these cells, right? As mentioned by Arndt and Andreas and Adi before. I mean, the pre-clinical studies in vitro, in vivo demonstrate the similarity, right? We do not anticipate that we have to run the bridging study. However, we can give more guidance once we have spoken to the FDA.
Yale Jen (Senior Managing Director and Senior Biotech Analyst)
Okay, great. Maybe to follow up on this one. If let's assume if a bridging study might be needed, are you guys in your mind have any sort of setup or design to fulfill that need or request if that happens? Thank you.
Wolfgang Fischer (COO)
Yeah. Of course, right, in preparing for the FDA interaction, we are evaluating all potential ways. Yes, we are thinking about all these different paths and look for solutions for that.
Yale Jen (Senior Managing Director and Senior Biotech Analyst)
Okay, great.
Adi Hoess (CEO)
When you look at the clinical study of Artiva, they already started with 1 billion cells as the first dose and are adding in now also rituximab, and they will only do one dose escalation to 4 billion. With non-modified cells, you have far less hurdles in terms of running dose escalations in this context. You can do a run-in, and that's what the most likely scenario will be that you may have just to treat initially three patients, see if this is safe, and then you can continue to recruit the larger number of patients. This is our assumption. As Wolfgang said, the assumption is based on a number of experiments that we've conducted.
We have just treated over 20 patients with AFM13 as monotherapy and also in combination. We have a very thorough data set. On top, we have shown a very good safety profile in combination with NK cells already. Our base case assumption is that there is the phase II run-in, and then we can start recruiting these patients. There should not be any separate studies being conducted. As Wolfgang said, obviously, we are prepared to react to every anything because we believe that there is a high chance that this treatment is coming through in an accelerated approval study and can really make patient lives very different just based on the data that you have seen in the ASH abstract. Thank you.
Yale Jen (Senior Managing Director and Senior Biotech Analyst)
Okay, thank you.
Operator (participant)
Thank you. Our next question comes from the line of Zhiqiang Shu with Berenberg. Your line is now open.
Zhiqiang Shu (Head of Healthcare Research and Senior Biotech Analyst)
Hi, good morning. I wanna ask also on AFM24 in combination with the atezolizumab. I like to ask about the two pancreatic patients you reported. One, I think, has some durable stable disease. I wonder from disease biology standpoint, any color can provide on why NK engager or macrophage engager can should work in this sort of cold tumor situation? Thanks very much.
Adi Hoess (CEO)
Andreas?
Andreas Harstrick (Chief Medical Officer)
Yeah. I mean, you're right. Pancreatic is probably one of the most difficult to treat tumors with immunotherapy. Now, given the mechanism of action of AFM24, we believe that we could be able or should be able to really get initial NK cells into these cold tumors. We also believe that we have a chance to activate macrophages in these cold tumors. I think increasingly our data indicate that this could kickstart really a concerted action of the innate and the adaptive immune system. Pancreatic cancer was selected based on this assumption that we provide a completely different mechanism of action with both parts of the immune system activated. It's an area of very significant unmet medical need. No immunotherapy has really worked here.
We wanted to give these patients really a chance. I think we have some quite good preclinical rationale that even pancreatic carcinoma could show some or could derive some benefit from the unique mechanism of action of AFM24.
Zhiqiang Shu (Head of Healthcare Research and Senior Biotech Analyst)
Great. Thank you. Maybe just quick follow-up on your out-licensed AFM32 folate receptor alpha program. I guess, can you remind us the economics over there and, given, you know, folate receptor alpha ADC is just recently approved, I guess, you know, any upside from that program that you see going forward? Thanks.
Angus Smith (CFO)
Yeah. Angus here, I could probably chime in on that. As you're aware, we have licensed AFM32 to a subsidiary of Roivant, as part of that deal. Through that deal, you know, that subsidiary will be responsible for funding the clinical trial costs, and in return, we're entitled to milestones and royalties on net sales.
Zhiqiang Shu (Head of Healthcare Research and Senior Biotech Analyst)
Great. Thank you.
Operator (participant)
Thank you. I'm showing no further questions at this time. Thank you all for your participation. This does conclude today's call. You may now disconnect.
Angus Smith (CFO)
Thank you.
Adi Hoess (CEO)
Thank you.
Andreas Harstrick (Chief Medical Officer)
Thank you.
Adi Hoess (CEO)
The conference will begin shortly. To raise your hand during Q&A, you can dial star one one.