Analyst Conference Summary

Biotechnology

conference date: March 15, 2018 @ 8:00 AM Pacific Time
for quarter ending: December 31, 2017 (Q4, fourth quarter 2017)

Forward-looking statements

Overview:

Basic data (GAAP):

Revenue was $8.4 million, up sequentially from $3.4 million and up from $5.6 million year-earlier.

Net income was negative $35.0 million, up sequentially from negative $36.9 million, and up from negative $26.1 million year-earlier.

Earnings per share (EPS) were negative $0.35, up sequentially from negative $0.37, and down from negative $0.30 year-earlier.

Guidance:

none

Conference Highlights:

CEO Garo Armen stated: "Our ability to rapidly advance clinical trials with our CTLA-4 (AGEN1884) and Keytruda as well as trials using our own proprietary combinations with AGEN1884 and PD-1 (AGEN2034) could lead to our BLA filing as soon as the end of 2019. We recently produced commercial grade CTLA-4 to assure our commercial readiness. This year, we will also file several INDs for our novel I-O antibodies including first/best-in-class bispecific tumor microenvironment conditioning agents."

Banking firms have approached to do equity offerings, but believe best course for shareholders is to execute potential collaborations. Merck is advancing an undisclosed antibody created by Agenus.

Agenus launched a Phase 2 combination trial of AGEN1884 with Keytruda for IL NSCLC with other 50% PD-L1 expression.

Dose escalation trials for AGEN1884 and AGEN1034 were completed. A Phase 2 trial combining these drugs to treat cervical cancer was launched.

Incyte (INCY) is collaborating with Agenus to develop GITR and OX40 antibodies (they are immune checkpoint modulators) as INCAGN1876 & INCAGN1949.

AutoSynVax vaccine initial safety data was reported and trials are being planned for 2018.

GSK's Shingrix vaccine, containing Agenus QS-21 Stimulon, received a U.S. approval on October 20, 2017. 97% efficacy "effectively shuts down any contender in this market." Also approved in Canada. The CDC voted to favor Shingrix over Zostavax.

The first cell therapy, through subsidiary Agentus, could be in the clinic in the first half of 2019. Believes has capabilities to target solid tumors. [If true, would put in lead in solid tumors - WPM]

Agenus West manufacturing supplied GMP material for clinical programs; preparing for GMP material for registrational program in 1H2018.

Prophage for newly diagnosed GBM (glioblastoma, a brain cancer) program continues.

A next generation CTLA-4 antibody should have an IND filed in 2018. This is designed to delete T-regs and increase priming.

Two bispecific antibody IND filings should happen in 2018.

Working with Amgen on research collaboration on phosphopeptide program..

A portfolio of undisclosed checkpoint modulators is being advanced in the lab. Neoantigen vaccines continue to be developed. Animal models have shown synergy between CPMs and vaccines. Agenus is identifying mutated proteins from cancers that could serve as a basis for vaccines.

Cost of sales was $0 million. Research and development expense was $31.9 million. General and administrative expense was $9.8 million. Contingent fair-value adjustment of negative $3.3 million. Leaving operating income at negative $3.0 million. Other expense was $5.0 million.

Cash and equivalents balance ended at $60.2 million, down $9.9 million sequentially from $70.1 million. After the quarter ended raised $28.1 million with a royalty bond restructuring. Cash used in operations was $25.8 million. No debt, but has received advances on vaccine royalties.

Q&A:

Checkmate 227 data effect on 1884? We will look at it very carefully. We are taking 1884 on top of Keytruda for first-line lung where Keytruda is approved based on a diagnostic, which should lead to a significantly higher response rate.

What is a win for 1884? What is not a win is a marginal improvement on efficacy or safety. We are looking for a significant delta (from Keytruda alone). We believe combinations are necessary to differentiate Agenus as a company, rather than monotherapies.

Novel CTLA therapy? With a new molecule you always have to watch for adverse events. We can't give details for IP reasons, but will be in an upcoming publication.

One of our bispecifics does intra-tumoral deletion of T-regs. We believe we will be the first to publish on this mechanism. "It will likely be the way antibodies are made in the future."

Structure of you bispecifics? We are not using traditional proprietary platforms. Engineered our bispecifics on FC regions and binding domains. "We have become experts at doing this." Is having partnership discussions. We have a high-throughput ability to identify optimal combinations. So we can do novel target development.

Has 1884 completed dose escalation? Yes. Will not give patient numbers for submission to FDA for competitive reasons.

We believe combinations in cervical cancer will exceed any single agent in efficacy. We were excited to see Merck's validation of PD1 in cervical cancer, which typically has high mutation rates. This only validates our strategy.

Agenus web site

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