Newsfilter article unlocker

Good afternoon, everyone. Thank you for standing by. Welcome to the Cytomics Therapeutics Second Quarter 2026 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, Cytomic's Chief Financial Officer. Please go ahead. Thank you. Good afternoon and thank you for joining us. Before we begin, I would 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-lookings statements, whether as a result of new information, future developments, or otherwise. this afternoon, we issued a press release that includes a summary of our second quarter 2026 financial results and highlights recent progress at Cytomics. 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 on our website. With me on the call today is Dr. Sean McCarthy, Cytomics' chief executive officer and chairman. Sean will provide an update on our pipeline and company progress before I cover the financials for the quarter. We will then conclude with a Q&A session. With that, I'll turn the call over to Sean. Thanks, Chris, and good afternoon, everyone. We're pleased to be here today to provide an updated update on the Cytomix project. We're happy to provide updates on our second quarter developments and what continues to be a highly productive year for cytomics. Our major focus continues to be Varsetta M, our first-in-class Epcam-targeting antibody drug conjugate, which to our knowledge is the only Epcam directed ADC in clinical development. We are aggressively developing Varsätta M in metastatic colorectal cancer, which I will refer to as CRC. The unmet need in CRC is very high and, in fact, projected to grow due to increased incidence in younger patients on a global basis. We view Varsetta M as a highly innovative drug candidate for the treatment of CRC and potentially the best-in-class ADC based on our clinical data reported to date. The Varsätta M development program is broadening rapidly, and we see significant value creation potential across our key priorities, which include, first, advancing Varsetta-M toward a registrational study and potential approval as a monotherapy in late-line CRC. Second, developing Varsätta-M in combinations to expand into earlier-line CRC with division to ultimately replace chemotherapy. And third, exploring Varsutta-M as a pan-tumor therapy across multiple EPCAM expressing cancers. In terms of our operational progress this quarter, I'll start with Varsetta M monotherapy development in late-line CRC. We have enrolled 113 patients into the overall Varsutta M Phase 1 monotherapy study across dose escalation, expansion, and optimization. Enrollment in dose optimization was completed in April, with a total of 40 patients enrolled across the 8.6 and 10 milligram per kilogram doses utilizing adjusted ideal body weight dosing. We remain on track to report by the end of 2026 a phase one data update for Varsetta M across the entire ongoing phase one trial with a key focus on the data that underpins monotherapy dose selection and the go-forward development strategy for our first registrational study that we aim to initiate in the first half of 2027. We continue to see monotherapy registritional strategies in either the third or fourth line, depending upon emerging data, as compelling opportunities, and we look forward to communicating our strategy later this year. In addition to monotherapy development, we are aggressively advancing Bracetta M in combinations to enable earlier line CRC therapy and we have made significant progress this quarter. The first combination we're exploring in an ongoing Phase I cohort is with bevacizumab, a foundational component of current standard of care in CRC across early and late lines of treatment. We are exploring Q2 week and Q4 week schedules to align with the clinical schedule of bevucizumib. We continue to enroll late-line patients, and we expect to focus on earlier line patients once we have selected a go-forward dose and schedule. We anticipate reporting initial clinical data in the first half of 2027. Our second combination study that we plan to initiate in Q4 will be a new phase 1-2 trial, initially evaluating escalating doses of Varsetta M in combination with Bevacizumab, 5-fluorouracil, and leucovorin in second-line CRC patients. This study is central to our goal of replacing arenatican with Varsetta M in earlier-lineCRC. I'd like to emphasize here that our work to date with VARSETTA M has been conducted entirely in late-line, unselected CRC patients. We've made terrific progress, and we view VARSNETTA M as a treatment for all patients with late-line CRC, including patients with liver mets, KRAS mutations, and other clinically meaningful characteristics that in other settings are used to differentiate patients and their treatment options. We think this pan-CRC potential makes Varsetta M stand out from other treatment options. We look forward to building on our promising start by bringing Varsutta M forward as a potential frontline treatment option, ultimately replacing chemotherapy. Now, moving to the development of Varsetta-M outside of CRC, we're very excited today to announce that we are initiating phase one expansion cohorts in additional gastrointestinal cancers. Initially, we are expanding into gastric and gastroesophageal junction cancer, pancreatic ductal adenocarcinoma, and biliary tract cancer. These are all EPCAM-positive tumor types, and in each case, we see significant unmet need that Varsetta M could potentially address. We prioritize these tumor types based on a number of criteria, including their known responsiveness to topoisomerase I inhibition and our own Varsutta M preclinical data, and we believe these indications could offer compelling regulatory opportunities. Our initial plan is to enroll approximately 20 patients per tumor type to assess Varsatta M's antitumor activity and safety before assessing next steps and potential later phase development options. As a reminder, in colorectal cancer, we are enrolling an unselected patient population due to the uniformly high expression of epcam in this cancer type. For our newly selected GI expansion indications, we think patient selection is advisable in certain cases in order to enrich the patient population while we continue to learn about the relationship between target level and antitumor activity. For pancreatic and biliary tract cancer, we expect to screen patients for EPCAM expression. For gastric and gastroesophageal junction cancer, like CRC, we suspect to enroll an unselected patient population given the high percentage of patients expected to have EPCAm expressing tumors. Overall, we believe the successful execution of these expansion cohorts could further position Varsetta-M as a pan-GI ADC, providing additional development opportunities across multiple lines of therapy. To summarize, we are very pleased with the continued progress with Varsutta-M as this really exciting program deepens and broadens toward our first registrational study, to earlier lines of therapy, and into other GI cancers. We look forward to providing a further update by the end of the year. Now turning to CX801, our masked interferon alpha 2B program being evaluated in checkpoint refractory melanoma. We see CX81 as a new and exciting opportunity to reprogram the immune responsiveness of solid tumors, and we continue to be pleased with the progress of the ongoing phase one study, both as monotherapy and in combination with Keytruda. Starting with monotherapy, we've reached the fourth dose in dose escalation, and to date, CX801 monotherapy has been generally well tolerated, including at dose levels exceeding those achieved with commercially available unmasked interferon alpha-2b. Initial biomarker data for CXA01 monotherapy presented previously have reinforced our mechanism of action hypothesis for CX801 in combination with Keytruda. We continue to make solid progress in the Phase 1 combination study and have now successfully cleared the third dose level, and enrollment is ongoing. We look forward to sharing initial clinical data from the Phase 2 study and the Phase 1 study in melanoma in the first half of 2027. Before I turn the call to Chris to walk through financials, I'd like to highlight our continued additional progress across the organization. During Q2, we announced a major expansion of our collaboration with Regeneron focused on next-generation masked bispecific immunotherapies. This is the result of our continued strong scientific momentum and represents validation of cytomics expertise in conditional activation, masking technologies, and protease biology. We've also been very pleased recently to have strengthened the organization through key additions to the board and executive team as we prepare Cytomix for the coming phase of growth and development. In May, we were delighted to welcome Mamata Gokhale as our Senior Vice President of Regulatory Affairs. Earlier this week, we announced the appointment of Alejandra Carvajal as our new Chief Legal Officer. Additionally, as we approach late phase development for Varsetta M in CRC, we are thrilled to have welcomed Dr. Charlie Fuchs to our board of of Directors. Charlie's a highly accomplished oncology leader, most recently serving as Chief Medical Officer of Tubulus. Prior to that, he led global oncology development at Roche Genentech after transitioning to industry from a long and distinguished career in academia as a global leader in gastrointestinal cancer. Welcome, everyone, to the Cytomics team. With that, I'll now transition the call over to Chris. Thank you, Sean. As Sean highlighted, we are making important progress across the increasingly broad Varsetta M development plan, with capital allocated to unlocking multiple layers of value creation over the near and long term. With our current balance sheet, we project cash runway to at least the second half of 2028, which positions us to advance Varsutta into its first potential registrational study, pursue combination development to bring Varsetta M into earlier line CRC, and invest in the broader potential of Varsutta in multiple EPCAM expressing indications. With that, I'm going to walk through our second quarter financial results. As of June 30, 2026, we ended the quarter with $330.3 million in cash, cash equivalents, and investments versus $346.7 million in cash as of March 31, 2026. The cash balance as of June 30, 2026 does not include the additional $37 million payment received from Regeneron in July following the selection of two additional targets under the expanded collaboration. Now looking at revenue and operating expenses for the quarter. Total revenue was $1.4 million compared to $18.7 million in the second quarter of 2025. The decrease in revenue was primarily attributed to the conclusion of the BMS collaboration in 2025 and for the Acellus collaboration in the first half of 2026. Operating expenses for second quarter were $25.2 million compared $19.9 million in second quarter 2025. R&D expenses were $17.6 million during the second quarter, representing an increase of $4.3 million versus the second-quarter of 2025, primarily due to manufacturing activities for Versetta M, as well as increased personnel-related costs and general research and development expenses. General and administrative expenses increased by $1 million during three months ending June at 2026 to $7.6 million, compared to $6.6 million for the corresponding period in 2025. Increased G&A expenses were primarily driven by higher consulting spent. As we move through the second half of 2026, we will continue to be disciplined in capital allocation with a focus on progressing for SETA-M towards its first registrational study and accelerating investments to unlock the broader potential in the program. With that, I'll turn the call back to Sean for closing remarks. Thanks, Chris, and thanks, everyone, for joining us today. We continue to be highly encouraged by the progress we're making with Varsetta M and the breadth of opportunities in front of us. Cytomics is working diligently to execute toward multiple layers of value creation for Varsutta M, simultaneously advancing toward a potential registrational program in CRC, expanding into earlier line settings, and further evaluating additional EPCAM-expressing gastrointestinal cancers. We also remain focused on advancing CX801 and generating clinical data in patients with advanced melanoma to inform the next phase of development for this program. We look forward to providing additional updates by the end of this year as these programs continue to advance. Before I conclude today's call, I want to sincerely thank and recognize the patients who participate in our studies, their families and caregivers, our clinical investigators, and our highly dedicated team at Cytomix. With that, operator, let's go ahead and open up the call for Q&A. Thank you. At this time, we will conduct the question and answer session. As a reminder, to ask a question, please press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Michael Schmidt with Guggenheim. Please go ahead. Oh, hey, guys. Thanks for taking my questions, and congrats on the progress. I had a question on these new studies. So in these GI cancer expansion cohorts, could you just comment a bit about how you're approaching dose selection here and to what degree you can implement learnings from that colorectal cancer experience? And then similarly, in the Bevacizumab combination study in colorector, are you, maybe talk about how you're approaching dose selection for this combination, and are you implementing the same GI prophylaxis, you know, into these cohorts that you're doing in the monotherapy dose optimization cohorts? Thanks so much. Hi, Michael. Thanks for the great questions. So, first of all, we're obviously very excited to be moving into these additional GI indications with Varsetta M. As you know, the targets expressed not only in these other indications, but also many other solid tumors. And so this is really just the beginning of the expansion of the program across multiple cancers over time beyond CRC. In terms of dose selection, obviously these will be initially monotherapy cohorts. And the dose selection we're not commenting on just yet, but is informed absolutely by the escalation, expansion, and optimization work that we've done in colorectal cancer over the last year or two. In terms of the BEV combination in CRC, as we've reported previously, we are exploring Q2 week and Q4 week doses to the schedules to align with the Q2 week Bevacizumab schedule. The doses that we've started out there, it's obviously a dose-finding study to evaluate multiple doses of Varseta M with Bev over time. But we didn't need to go all the way back to the beginning in dose escalation. So we actually, We believe we started at meaningful doses of our set of M, and we're excited to see the data as it emerges. And we're on track, as we just commented, to present initial data in the first half of next year. And then to your last question on prophylaxis, yes, we are indeed utilizing the same loperamide-budesonide prophylaxis strategy in the BEV combo study. Thank you. Thank you. One moment for our next question. Our next question comes from the line of Edward Tentoff with Piper Sandler. Please go ahead. Great. Thank you very much, and I really just have to say congratulations on the success across the board from team to clinical to really everything you guys are just really growing this company nicely. I wanted to pick up on these combo CRC studies, appreciating that the first regulatory push is going to be monotherapy later lines. What do you see as sort of the path forward here with combo and earlier line CRC? Maybe you can just sort of lay out kind of when we could expect data and kind of what you see as the potential requirements for future studies there. I appreciate it. Thanks, Ted. Appreciate the comments. So, well, maybe beginning with the BEV combination, there's a lot of different reasons that we're doing this work, of course, given how foundational BEV is in the treatment of colorectal cancer across multiple lines, are early and late. And so the study will open up multiple opportunities, potentially a third-line study and obviously enable work in the first and second line over time in combination with Varsetta M, potentially in combination chemotherapy. So we do see this BEV work that we're doing, as I know others do, as really foundational to broadening the program across multiple lines over time. We're also super excited to be getting the chemo combination going with 5-FU later this year, which is, of course, designed to bring varicetam initially into the second line to replace erinotecan, where erinotecan fulferi is most commonly used. It's not infrequently used in the front line, as you know, but most commonly commonly used in the second line. So, this arena T-can replacement strategy is really going to be enabled by this first step of the phase 1-2 study that we'll launch in Q4. Obviously, a little too early to be able to comment on potential registrational paths in those earlier lines, but we do see that these combination studies unlock enormous potential in the coming years. Yeah, totally get that. And if I may, just one quick one for Chris. With the milestone or the payment from Regeneron in the third quarter, would that be recognized? Did you, you didn't recognize that in the second quarter. Would it be recognized fully in revenues in the third quarter? Thanks. Yeah, great question, Ted. I mean, first, just to emphasize, we're obviously thrilled to be expanding the collaboration with RegenerON. It's, you know, based on a few, you Know, hard years of work from the research team. And I think just a reflection of the foundational science. The payment, just a reminder, was $37 million for two additional programs. So that takes our pro forma cash to about $367 million. That $37 billion will be recognized as we do the work and make progress with Regeneron. And those obviously are preclinical projects, so do take a number of years. So you should expect that to play out over a few years at least. Great, thanks guys. Thank you. One moment for our next question. Our next question comes from the line of Anupam Rama with JPMorgan. Please go ahead. Hey guys, this is Joy from Anupama. Thanks so much for taking our question. I know you've previously said that a 10% to 20% grade 3 diarrhea rate would be acceptable for the late-line CRC population. I think there is a fear that if the rate is on the higher end of this range in your next update by year-end 2026, there could be a risk to moving the product upstream. Just how would you respond to this pushback? Thanks so much. Hi. Thanks for the question. So an area of the program that we're obviously highly focused on at the moment as we move through our monotherapy dose optimization cohorts, where as we reported in our data update in March, our early experience with the prophylaxis strategy of loperamide and budesonide was very encouraging with the rate of grade three diarrhea after the first couple of months of experience having been brought down to 10%. So a really strong start. And yeah, the work that we've done, and I think that many others have done in looking at, you know, when we think about risk benefit of Varsetta M in the context of grade three diarrhea, that 10 to 20% number is, you knows, is what we've been discussing and others have been discussing with us. You know, at the end of the day, I mean, this drug, when you think about the unmet need in not just the late line, but actually even in the earlier lines of CRC treatment where, for example, even in second line, I don't think we can say that outcomes in the second line are terrific for patients today. It's all going to be about risk-benefit. And we know we've got a very active drug here in Varsetta M that targets Epcam with the topoisomerase 1 inhibitor and has shown just really impressive activity in a patient population so far, which has been, as we mentioned in our comments, really quite late line, you know, more than half our patients fourth line or later. So it's all going to be risk-benefit, I think, and this is going to evolve over time. I would also say that we will continue to learn more and more over time about the etiology of this adverse event, the etiology of diarrhea in these patients, you have time to onset, time to, you know, impact of prophylaxis, time to resolution. And this will be an ongoing element of the program that we'll continue, I think, to increasingly understand and manage. So, we'll just keep doing that work. Thank you. One moment for our next question. Our next question comes from the line of Epser Darote with Barclays. Please go ahead. Great. Thanks for taking the question and apologize for the background noise. Just a couple of questions for me. First, Sean, are you targeting a certain amount of follow-up time for the CRC late-line update by year end, given that the study was enrolled in April? And then secondly, curious on the biliary tract and on the pancreatic ductal cancer, if you can comment maybe on your thoughts around expression levels of EpiCAM in those two cohorts of patients. Thank you. Yeah. Hi, Ed, sir. Thanks for the questions. In terms of follow-up, so great question. So what we're working towards in terms of the next update is an update across the entire 113 patient study that will include data from the ongoing 40 patients in dose optimization. And as we've done in the past, you know, our goal is to communicate data from the optimization cohorts when it is sufficiently mature to have a preliminary estimate of progression-free survival. We think that will be most helpful for investors and that's, as you know, the approach that we took coming into the last update in March of this year. Another important update that we'll have by the end of the year will be the first look at overall survival for this drug in CRC and that will come from the patients in the escalation and expansion phases. I think that's going to be an important communication. And of course, that number will be quite foundational in driving our decision-making on what the first registrational, the first pivotal study looks like in the first half of next year. So as always, our goal is to communicate data when it's mature enough to be most meaningful for all stakeholders. Great question on the biliary tract and pancreatic tumor types. EPCAM is expressed at some level in just about all patients based on work that's in the literature and also prevalent studies that we've done ourselves with our own validated IHC assay. EPCам high patients, kind of depending upon how you define it, is about 50% to 60%. So it's a pretty significant number. and you know the reason that we're planning to select is it really it's just a starting point for these tumor types we we think it makes sense to at least start in in high at cam expressing you know with high to be defined we have you know we haven't yet disclosed what that cutoff will be that that will come at a later date but we do think it make sense to start there not because we really know anything at this point about the relationship between target level and activity of the drug because of course in CRC every patient's high so it didn't really give us that information. That's something that we'll learn about over time and I would think over time as well we'll be interested to learn what Varsetta M can do in tumors maybe with lower expression because we're at the really early in the early days of learning about at EPCAM now as a validated oncology target for the first time. Great. Thanks, Sean. Congrats on the progress. Thank you. Thank you, one moment for our next question. Our next question comes from the line of Roger Song with Jefferies. Please go ahead. Hey, team. Thanks for the update. This is Nabil on for Roger. Thanks for taking our questions. First, just curious, as you get close to the year-end update and the planned registration starting the first half of next year, what pieces of the puzzle are becoming a little bit more clear? Just curious, have you met with the FDA and what do we need to resolve before we finalize that registration population, the endpoint? And And then I had a follow-up question. Thank you. Yeah, hi, Nabil. So, yeah, very focused on that question right now. And as we move through the back half of 2026, we anticipate multiple interactions with FDA across the program. And as I said in my prepared remarks, we continue to see tremendous opportunity in either the fourth line or the third line settings with the drug candidate in terms of what we need to pin down to go in one direction or the other. Obviously, we're looking at what do those patient populations look like? What is the relevant comparator arm in each of those populations? And as the data matures over the course of the year, the rest of this year uh you know what would the uh the sizing of those studies need to be uh uh to um you know to to to be um sufficiently powered to get to the result that we want so uh that's all in the mix right now we will make a a data driven uh decision we will uh take a data-driven uh recommendation to uh and plan uh to fda uh and uh and move forward with with the first pivotal in first half of next year and everything remains on track in that regard. I believe you said you had another question. Yeah, thanks, Sean. Excited about the pipeline progress and just the platform potential we have here. Just, I know it's early, but how are you approaching prior renal TCAN or just prior to the 180C exposure in those non-CRC cohorts? Thank you. Well, as you know, in the late line and really in the patients that we've treated today across the phase one study, everyone has seen erinotecan in their, you know, over their treatment journey. So that is an absolute function of being in the late line, of course. In the earlier lines, as I said, our goal is to get into the, initially, over time, into the second line to evaluate the replacement of erinotecan. So that is an objective that is very much being facilitated by the Phase I-II study we plan to start in Q4 this year to get initial experience of Varsetta M in combination with the regimen components minus putting Varsutta M in place of Irinotecan. So that will be a very important experience, and we're excited to get that work going because, and I think maybe this is the point that you're alluding to, we're obviously all very excited to see what Varsetta-M can do in arena-tecan-naive patients. I'd also just add, Nabil, that as we gain experience with Varsutta in combination with chemotherapy, that could certainly over time apply to other indications as we learn about dose and schedule and how those things can combine. So, I think the work could, of course, synergize as we learn about new indications and combinations in general. Excellent. Thanks for taking our questions. Thank you. As a reminder, to ask a question, please press star 1-1 on your telephone. One moment for our next question. Our next question comes from the line of Kalpit Patel with Wolff Research. Please go ahead. Hey, thanks for taking the question. This is Guggen on for Kalpit. A few quick ones on our end. The timing of the monotherapy readout is by year end. Is that mainly so you might be able to accumulate PFS data in addition to ORR? And can we expect the mature PFS in the updates that are this year? And two, what's your bar for success or a good outcome on median PFS in your view? And thirdly, on the pivotal study, what are your thoughts on the control arm in the registrational study? And would the FDA require LawnSurf Bev as a competitor? Thank you. Yeah, great questions. In terms of the monotherapy readout, I think as we discussed a little earlier in the call, Our plan is to communicate data when we do indeed have an initial read on PFS for the optimization cohorts that we've been running that we had fully enrolled by the end of April. So we're on track as that data is maturing in real time. And I should say here that, you know, our baseline assumption for the first registrational study is that the primary endpoint will be overall survival. That is, we think, most likely in a late-line colorectal cancer population. And so, you Know, PFS and ultimately OS are going to be the most important metrics coming out from the phase one study. So for that reason, we do plan to communicate or we will wait to communicate until we have an initial sense of PFS. And that's exactly what we did with the escalation and expansion cohorts in March of this year. In terms of the bar for success, I think it connects quite closely to your third question about control arms, of course. And that relates very much to whether we run this first pivotal in the third line or the fourth line, both of which, as I've mentioned, we see as very compelling opportunities for building significant value in the company and helping patients. In the fourth line, the most likely comparator would be something like frequentinib or frequentinab and regorafinib, perhaps physician's choice. Those are all options that we're looking at in the fourth line. And I think, and you're right, I think in the third line, we assume that the comparator there would most likely be bevacizumab plus longserve. And then just lastly, in terms of what success looks like, we just continue to point to the benchmarks. And so the benchmarks in terms monotherapy treatments in the fourth line, you've got response rates that are very, very low in the low single digits, 1% to 2%, and just a few months of progression pre-survival, and five to six months of overall survival. And then with BevLonsurf in the third line, perhaps four and a half to five and a half months of PFS, nine to 10 months of OS. We reported, as you may recall, in March in our update across the study, progression-free survival at the top two doses, which were now in optimization, 8.6 and 10 MPK, we presented preliminary PFS of 6.8 to 7.1 months, and obviously very, very encouraged by that. So, you know, we'll see how the data continues to shape up, but we think we've got terrific options here, whichever way we go. Awesome. Thank you. You're welcome. 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. Thanks very much. And I'd just like to, again, thank everyone for tuning in today and following our progress. We're very, very excited about 2026 so far, and we look forward to providing additional updates as we move to the back end of the year. Thank you very much Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.