Analyst Conference Summary

conference date: October 27, 2015 @ 8:00 AM Pacific Time
for quarter ending: September 30, 2015 (Q3, third quarter 2015)

Forward-looking statements

Overview: Agenus monetized its future revenue stream from its GSK malaria vaccine component. Several critical announcements could be made in Q4.

Basic data (GAAP):

Revenue was $6.8 million, up sequentially from $6.4 million and from $1.6 million year-earlier.

Net income was negative $13.1 million, up sequentially from negative $40.4 million, and down from negative $8.1 million year-earlier.

Earnings per share (EPS) were negative $0.16, up sequentially from negative $0.53, and improved from negative $0.13 year-earlier.

Guidance:

none

Conference Highlights:

“We have also strengthened our balance sheet by monetizing a portion of our QS-21 adjuvant royalty stream, which provided us with net proceeds of approximately $78 million. We also acquired the rights to antibodies targeting CEACAM1, expanding our portfolio to include powerful immune-modulators that may be complementary with other checkpoint modulators, including those in our pipeline,” said CEO Garo Armen. In July, Agenus had announced the acquisition of antibodies targeting Carcinoembryonic Antigen Cell Adhesion Molecule 1 (CEACAM1) from Diatheva s.r.l., an Italian biotech company controlled by SOL S.pA.

In 2015 Agenus hopes to advance Prophage for newly diagnosed GBM (glioblastoma, a brain cancer) into a Phase 3 trial later this year. More data was presented in September at the International Cancer Immunotherapy Conference. There is very encouraging long-term survival in a group of patients. Agenus hopes to retain U.S. rights while funding the trial or trials with collaborators.

Royalties from the GSK malaria vaccine, which is approved by the EMA but not yet producing revenue, were monetized through an investor group. Agenus received $78 million for its QS-21 adjuvant. This was characterized as "a portion of worldwide royalties." Agenus issued notes that are to be paid by the royalty stream. The notes carry interest, but it is also paid out of royalties. If royalties do not pay for the entirety of the note, Agenus must make up the difference in 12 years.

This morning the GSK shingles vaccine using QS-21 reported very positive results from a large trial.

Agenus made progress in creating 2 CPM antibodies for its deal with Merck.

Agenus may start clinical trials with its own or Incyte-partnered CPMs some time in early 2016, following IND filings with the FDA.

As a development stage biotechnology company, Agenus is focused on pipeline development, including QS-21 Stimulon, immunotherapy, and heat shock protein vaccines. Along with partners, Agenus has 22 programs in clinical development.

Cost of sales was $0 million. Research and development expense was $18.5 million. General and administrative expense was $6.4 million. Contingent fair-value adjustment of $7.0 million. Leaving operating income at negative $11.1 million. Other expense was $2.1 million.

Cash and equivalents balance ended at $199.1 million, up sequentially from $139.6 million due to the infusion from the adjuvent deal.

Agenus believes it has sufficient cash to fund operations for now. Agenus has no plans to raise cash through equity offererings, for now.

Further information on the pipeline will be given on analyst day on November 19.

Q&A:

Trial costs vs. liquidity, competition with larger companies in CPMs? We hope to collaborate with big pharma companies in clinical trials. Some trials will be on a cost sharing basis. We already have partnerships with Merck and Incyte.

First data timeline from checkpoint program, including LAG3? We plan to be in the clinic with several compounds in 2016. It takes time to do Phase 1 and 2 trials. You are right, LAG3 shows good preclinical activity. Phase 1 trials would be needed to show it is safe, then later trials would likely be in combination with other therapies. Perhaps we can do combined Phase 2/3 trials. Combinations might go beyond CPMs. We are exploring many options.

CART and TCR spaces? These therapies, with solid tumors, need to consider cancers' defenses. So we are thinking about that very carefully. Re vaccines vs. engineered cells, we see a strong place for vaccines as well as CPMs.

Neo-antigen approach and sequencing patients? We will elaborate on that and other developments on our research day.

Timing of Prophage deal? Cannot commit to it being completed before year end.

Our top priority for our cash is checkpoint development, followed by small inovative Prophage trials, until we have collaborator funding for a Phase 3 Prophage trial.

Agenus web site

OpenIcon Analyst Conference Summaries Main Page

Search

More Analyst Conference Pages: