Analyst Conference Summary

conference date: May 10, 2018 press release only
for quarter ending: March 31, 2018 (Q1, first quarter 2018)

Forward-looking statements

Overview: Announced plans to move forward after a therapy failed its trial this quarter.

Basic data (GAAP):

Revenue was $4.1 million, down sequentially from $3.5 million and up from $1.5 million year-earlier. All revenue was from license agreements, contracts or grants.

Net income was negative $ million, up sequentially from negative $3.8 million and up from negative $ million year-earlier.

EPS was negative $, up sequentially from negative $0.03, and up from negative $ year-earlier.

Guidance:

Cash could last until 2020.

Conference Highlights:

CEO Anthony Marucci stated: "Celldex has made considerable progress on an important strategic prioritization of our pipeline, following announcement in April of the METRIC study results in triple-negative breast cancer and discontinuation of the glembatumumab program across all indications. In 2018, we will focus primarily on continued clinical development of two company-sponsored programs—CDX-1140, a promising CD40 agonist, and CDX-3379, which blocks ErbB3, a receptor thought to play an important role in regulating cancer cell growth and survival. Development of varlilumab and CDX-301 will also continue externally through investigator-sponsored initiatives and internally through inclusion in combination studies."

Restructured the business in April. Believes can operate through 2020. "This extended runway will provide for multiple inflection points, and we are solely focused on executing along these lines."

The triple-negative breast cancer study primary endpoint data from the METRIC Phase 2 study of Glembatumumab vedotin failed to reach its endpoints.

Celldex is working with Bristol-Myers to do a broad Phase 1/ 2 combination study of varlilumab with nivolumab (Opdivo) for a variety of cancers. Phase 2 cohorts is enrolling for 5 types of cancer. Targets CD27. Data will be presented at meetings, starting at ASCO in June.

CDX-3379 (formerly KTN3379) initiated an open-label Phase 2 study in Q4 for head and neck squamous cell cancer, in combination with Erbitux. Blocks ErbB3 (HER3). After the first stage of the Phase 2 study completes enrollment, data will be analyzed before proceeding further. Clinical data was presented at AACR in April, showing safety and reduction of pErbB3 levels. Of 12 patients 11 showed stable disease and one showed tumor shrinkage.

CDX-301 is in several early investigator-sponsored studies, one for HSCT (hematopoeitic stem cell transplantation), one for B-cell lymphomas, and NSCLC. May do future studies combining with 1140. Data presented at AACR in April for NSCLC showed progression-free survival at 4 months achieved by 56% (or 5 of 9) of patients. Also 56% achieved PRs (partial responses).

CDX-1140 started a Phase 1 trial in November, testing against a variety of CD-40 expressing cancers. An expansion phase is also planned, and may start combination cohorts later this year. Preclinical data was presented at AACR in April.

"Celldex's preclinical pipeline includes CDX-0159, which is planned to enter the clinic in 2019; the TAM program, comprised of the targets Tyro3, AXL and MerTK; and a bispecific antibody (BsAb) program. Celldex's initial BsAb candidate couples CD27 co-stimulation with blockade of the PD-L1/PD-1 pathway using novel, highly active anti-PD-L1 antibodies. Data from this program were presented in a poster at the AACR 2018 Annual Meeting. The BsAb was more potent in human T cell activation and anti-tumor activity compared to the combined CD27 and PD-L1 antibodies. Enhanced efficacy has been attributed to more efficient cross-linking of the CD27 receptor, resulting in stronger T cell activation"

Cash ended at $123.2 million, down sequentially from $139.4 million. In the quarter Celldex raised another $11.7 million under the Cantor common stock sales agreement.

Operating expenses of $123.7 million consisted of: $21.9 million for R&D; $5.6 million for general and administrative; $91.0 million goodwill impairment; $18.7 million intangible asset impairment; and $0.2 million amortization, plus a gain of $13.6 million on remeasuring a contingent consideration. Operating loss was $119.7 million. There was $0.8 million other revenue. The income tax benefit was $0.8 million.

Q&A:

none, press release only

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