Y-mAbs Therapeutics Q3 2024 Earnings Call Transcript

Quartr
Provided by Quartr
November 8, 2024

There are 11 speakers on the call.

Operator

Good morning, and welcome to Ymabs Therapeutics Inc. 3rd Quarter Conference Call for 2024. At this time, all participants are in a listen only mode. Instructions for the question and answer session will follow the prepared remarks. As a reminder, today's conference will be recorded.

Operator

I will now hand it over to Ymab's Head of IR, Courtney Dugan.

Speaker 1

Thank you, operator, and good morning, everyone. Welcome to the Ymab's Q3 2024 Financial Results Conference Call. We issued a press release with our results this morning before market opened. The press release and accompanying slides are available on the IR section of our website. Let me quickly remind you that the following discussion contains certain statements that are considered forward looking statements as defined in the Private Securities Litigation Reform Act of 1995.

Speaker 1

Such statements include, but are not limited to, statements about our business model, commercialization and product distribution plans expectations with respect to clinical trial data expectations related to current and future clinical and preclinical studies and our research and development programs and regulatory submissions potential regulatory, marketing and reimbursement approvals collaborations or strategic partnerships and the potential benefits thereof expectations related to our anticipated cash runway and cash investment and the sufficiency of our cash resources and assumptions related thereto financial guidance and estimates for 2024 and beyond and other statements that are not historical facts. Because forward looking statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by such statements due to a variety of factors, including those risk factors in the company's previously filed annual report on Form 10 ks for the year ended December 31, 2023, and its quarterly report on Form 10 Q for the quarters ended March 31 June 30, 2024, and the company's quarterly report on Form 10 Q for the quarter ended September 30, 2024 to be filed with the SEC today. I would now like to turn the call over to our President and CEO, Mike Rossi.

Speaker 2

Thank you, Courtney. Good morning and thank you for joining us. I have with me today our Chief Commercial Officer, Sue Smith our Chief Medical Officer, Doctor. Vineshwar Jha and our Chief Financial Officer, Deep Prinshaw. This morning, I will begin by reviewing key financial and operational highlights from the Q3 of 2024, including Daniella's sales performance and the clinical progress of our radiotherapy clinical programs utilizing our self assembly disassembly pre targeted radio immune therapy or SOTAPRINT technology platform.

Speaker 2

Next, Sue will provide details on our global Daniela sales in the Q3. Vinesh will then provide updates around our ongoing naxitamab ISS clinical trials. Then Pete will review our Q3 2024 financial performance, our cash resources and reiterate our full 2024 guidance before we open the line for Q and A. Let's begin with the key highlights for the Q3 of 2024 starting with Danielza. Danielza, the brand name for humanized anti GD2 therapy, naxitamab, is FDA approved for the treatment of children aged 1 year and older with relapsed refractory high risk neuroblastoma in the bone or bone marrow.

Speaker 2

Neuroblastoma continues to be the most common cancer in infants and the 3rd most common cancer in children. Daniela is specifically designed for children who have had an incomplete response to induction or relapse therapy and also have disease in the bone and or bone marrow. While designated as an outpatient therapy, Daniela can also be administered in the inpatient setting depending on the specific needs of the child. We are nearing the 4 year mark since the commercial launch of Daniela in the U. S.

Speaker 2

Despite some of the headwinds around competition we saw from the Q2 carry into the Q3 this year, our overall commercial progress since launch back in 2021 shows encouraging continued progress in terms of the number of sites we are able to reach and the patients we are able to treat with Daniela. In the Q3, we added 3 new U. S. Daniela accounts and saw a 5% increase in Daniela demand compared to the Q2 of this year. This signals to us increasing physician adoption of Daniela across both new and existing accounts and more patients having access to this important anti GD2 therapy.

Speaker 2

Our team continues to drive important initiatives around direct to parent education and patient advocacy efforts with the goal of thoroughly understanding the current gaps in patient care and increasing awareness of Daniela as an important treatment option for children with relapsedrefractoryhighrisk neuroblastoma to achieve a complete response and remission. You will hear more from Sue on specifics around Danielle's performance across our U. S. And ex U. S.

Speaker 2

Markets shortly. In the Q3, we achieved total net revenue of $18,500,000 down 10% from the same period in 2023. The decrease was due to a decline in net product revenues in both the U. S. And our ex U.

Speaker 2

S. Markets in the quarter, in addition to a $500,000 in licensing revenue recorded in the Q3 of 2023. For the 1st 9 months of the year, we achieved total net revenue of $61,200,000 relatively consistent with the same period in 2023. We had several corporate updates in the quarter that support our continued global commercial and indication expansion efforts. We are thrilled to have received notification of the accepted patent extension for Danielza, U.

Speaker 2

S. 931-five 85 last month. Our U. S. Patent will now expire February 5, 2034 extended from June 20, 2001.

Speaker 2

In the Q3, we entered into a lease agreement for our future Ymabs headquarters in Princeton, New Jersey. We expect the construction of the premises will be completed in the first half of twenty twenty five and the lease will run for 10 years 9 months from the completion date. Earlier this week, we announced that we have entered an exclusive license agreement and distribution agreement with Noble Pharma for the development and commercialization of Danielza in Japan, if approved in the region. We received an upfront payment of $2,000,000 which will be recorded in the Q4 of this year. Under the terms of the agreement, we are entitled to receive up to US31 $1,000,000 in product and commercial milestone payments in addition to profit sharing on the commercial sales of Daniela, if successfully approved and commercialized in Japan.

Speaker 2

Japan represents an important Asia region for Daniela and we look forward to partnering with Noble Pharma and expanding access to Daniela to the region if approved there. Our partner TR Pharm launched the Danielson name patient program in Turkey in the Q3 of 2024. We are very pleased with how the launch is progressing and look forward to providing further updates in future quarters. In addition, with our Latin American partner, Aetium, we plan to submit a regulatory filing for marketing approval of Daniela in Argentina later this year. Overall, we remain confident in our U.

Speaker 2

S. Commercial strategy and trajectory in the continued ex U. S. Expansion of Daniela to fill important gaps in treatment of children with relapsed or refractory high risk neuroblastoma. Let's now shift to our SADA BRIT programs.

Speaker 2

Starting with our Phase 1 trial evaluating the safety and tolerability of GD2 SADA for the treatment of GD2 positive solid tumors. This is a basket trial looking at small cell lung cancer, sarcomas and malignant melanomas. In the Q4, we opened Cohort 6 to include adult patients 16 years of age or above with high risk neuroblastoma. As a reminder, this Phase 1 dose escalation single arm multicenter safety study has 3 parts. Part A, which we are currently in, is structured to demonstrate the safety profile of the protein while explores dose finding for the GD2 SADA molecule and testing of the dose intervals of 2 to 5 days between the protein and the lutetium dota payload.

Speaker 2

Part B aims to determine the optimal dose of lutetium-one hundred and seventy seven dota and Part C will evaluate the safety and initial signs of efficacy using repeat dosing. To date, we have 6 sites open, have a total of 20 patients in Part A of this trial. We have completed cohorts 1 through 5 using a radioactive payload of up to 200 millicuries of lutetium and 2 to 5 day interval between sata protein and payload. The initial blood pharmacokinetic profile of the construct in these patients dosed with 0.3 milligram per kilogram, 1 milligram per kilogram and 3 milligram per kilogram of protein appears to match our preclinical models in the terms of clearance data and blood PK profiles from patients are comparable and supportive of the current dose interval between 2 5 days. We continue to be encouraged by what we have seen so far.

Speaker 2

To date, no patients in the trial have experienced any dose limiting toxicities and there have been no instances of treatment related serious adverse events. Based on the spec CT scans and PK activity we have seen to date, we believe we have demonstrated proof of concept in humans that GD2 SADA can both find and bind to tumors. It is important to note that these early data are not complete and not necessarily indicative of a full results or ultimate success of the trial or the SADA development program. We are on track to complete Part A of this Phase 1 study by the end of this year and we'll look to present a full data set from Part A in the Q1 of 2025. In the anticipated data readout from Part A of the trial, our objective is to demonstrate the safety profile of the protein and determine the optimal timing to administer the radionuclide, all of which will inform Part B.

Speaker 2

We also plan to show additional scan images and PK data. Because we elected to open a 6th cohort to include adults with neuroblastoma, we're awaiting the full data from Part A before filing an IND for a GD2 SADA Phase 1 trial in pediatric neuroblastoma. Our second SATA PRIT program is CD38 SATA, which we are first studying in the treatment of non Hodgkin's lymphoma focusing on B cell and T cell lymphoma. This is our 1st SADA program in circulating tumors. Our planned Phase 1 follows the design comparable to our GD2 SADA Phase 1 trial, which you can see here.

Speaker 2

We have selected the first six sites and activated 2 sites and expect to dose the first patient by the end of 2024. In addition, we look forward to highlighting preclinical CD38 SADA data in a poster presentation at the American Society of Hematology Annual Meeting on December 7 in San Diego. The abstract titled PD38 SADA, a self assembling and disassembling bispecific fusion protein for 2 step pre targeted radio immune therapy of non Hodgkin's lymphoma is available on the ASH website. We are very excited for the potential of SODAPRIT to fill much needed gaps for patients across a range of cancers and potentially other serious diseases and we continue to believe in its potential advantages in manufacturing, administration and logistics with traditional radiopharmaceuticals. We look forward to providing further updates on our SOTAPRIT programs going forward.

Speaker 2

Across both our Daniela'sit and SOTAPRIT platforms, we are committed to advancing a potential generation new generation of therapies through clinical development aimed at improving outcomes and long term quality of life for patients and their families. I will now pass the call over to Sue Smith to provide further color on global Daniela sales for the Q3 of 2024.

Speaker 3

Thank you, Mike, and good morning, everyone. Despite seeing some of the same headwinds we saw in the Q2 carrying to the Q3, we're pleased with the overall commercial progress of Daniela since the initial commercial launch in the U. S. And across our ex U. S.

Speaker 3

Markets. Danielza is an important anti GD2 therapy for the physician toolbox in the treatment of patients with relapsed refractory high risk neuroblastoma in the bone or bone marrow. Its key unique features including outpatient administration and response in bone and or bone marrow makes Danielza an important treatment option for patients and caregivers alike. In the Q3 of 2024, total U. S.

Speaker 3

Danielza net product revenues were $15,300,000 representing a 5% decrease compared to the same period in 2023, primarily driven by a change in estimate from Medicaid claims. While we encountered continued competition from the launch of a new market entrant for maintenance therapy in addition to ongoing clinical trial activity, we still saw increases in key performance indicators. A total of 68 accounts have now used Daniela around the U. S. Since its initial launch in 2021 with 3 new accounts added in the Q3 of 2024.

Speaker 3

Daniela's estimated total share of the U. S. Anti GD2 market remains steady at approximately 15% as of September 30, 2024. We're excited to see physician utilization of Daniela continue to grow. 34 health practitioners started patients on Daniela in the 9 months ended September 30, 2024 with 7 physicians starting treatment on 2 or more patients.

Speaker 3

Since launch, a total of 113 healthcare providers have prescribed Danielza and 34 of those have started treatment on 2 or more patients. Our dedicated U. S. Commercial sales team continues to receive positive health care provider feedback on Danielza through ongoing customer interactions. In addition, we continue to see institutional adoption of Danielza, which has been added to 2 hospital formularies in the Q3 of 2024, bringing the total since launch to 48 hospital formularies as of September 30, 2024.

Speaker 3

Now turning to our ex U. S. Commercial progress. Ex U. S, our Q3 2024 Danielson net product revenues were $3,100,000 a decrease of 19% compared to the Q3 of 2023.

Speaker 3

The decrease was primarily driven by a decline in volume from our WEP patient access program in Europe, which had an initial stocking order in the Q3 of 2023. The Q3 marked the 1st recorded sales in Turkey with our partner TR Farm and the 2nd consecutive quarter of Daniela's sales in Brazil and Mexico led by our Latin American partner, Adium. We expect to see additional adoption over the coming quarters and look forward to providing further updates as we learn more about market dynamics in these regions. In Asia, our partner, Cyclone, continues to expand use of Daniela in China and is gearing up to launch Daniela in Hong Kong following its approval in the region last quarter. Our team is committed to finishing the year with strong Q4 performance of Daniela in the U.

Speaker 3

S. And continuing to support our ex U. S. Partners as they expand access to Danielza across their respective regions. We are confident in the potential to position Danielza as the anti GD2 therapy of choice in relapsed refractory high risk neuroblastoma in the bone and or bone marrow to both physicians and caregivers and expect to see a continued overall upward trend of sales growth over the long term.

Speaker 3

We look forward to providing further updates throughout the coming year. I will now pass the call to Vignesh.

Speaker 4

Thank you, Sue, and hello, everyone. I'm pleased to provide a brief update on our ongoing investigator sponsored naxitamab clinical trials. Let's start with Memorial Sloan Kettering Cancer Center's Phase 2 clinical trial evaluating naxitamab in patients with second line relapsed osteosarcoma. As we shared during our Q2 earnings call based on a draft abstract our team received from MSK back in June, the trial did not meet its primary endpoint of 16 event free patients at 12 months and instead stated that there were 14 event free patients at 12 months. MSK is expected to present this data at a medical meeting by the end of this year, after which time our team plans to analyze the full study results and evaluate next steps.

Speaker 4

In the frontline high risk neuroblastoma setting, our partner, the BEAT Childhood Cancer Research Consortium, or BCC, is leading a multicenter Phase II trial evaluating naxitamab in combination with standard induction therapy for patients with newly diagnosed high risk neuroblastoma. As of the end of Q3, the BCC had 22 active sites and treated 11 patients with recruitment ongoing. The amended protocol for the transition to a comparison with an external control is currently being developed. We expect the trial to transition from a single arm trial design to a comparative trial with an external control arm that reflects current standard of care for induction therapy with a comparable patient population that is carefully selected and propensity score matched. Our aim for the trial is to demonstrate superiority in complete response rates at the end of induction therapy in the naxitamab arm compared to the standard of care.

Speaker 4

In advanced breast cancer, we are partnering with the Ohio State University of a Phase 1b trial investigating TGF beta NK cells, gemcitabine and naxitamab in patients with GD2 positive metastatic breast cancer. Patient recruitment for the trial was initiated in the Q3 of 2024. As per the study design, follow-up for dose limiting toxicities with a combination of gemcitabine and NK cells need to be completed and the persistence of NK cells in the blood needs to be confirmed before the addition of nexitamab. Upon the outcome of this trial, we would consider moving forward with a multicenter Phase II trial. In patients with refractory Ewing sarcoma, the Institute of Mother and Child in Poland is leading a randomized Phase II trial evaluating the efficacy and safety of naxitamab.

Speaker 4

This trial was initiated during the Q4 of 2023. Three patients have been dosed with enabaxitamab arm to date and recruitment is ongoing. We expect a total of 16 patients in that arm. The trial is expected to be completed in 2028. In addition, we are in discussions with the MD Anderson Cancer Center to initiate a multicenter Phase 1 study to evaluate the addition of naxitamab to current standard of care in the treatment of metastatic triple negative breast cancer.

Speaker 4

The study is expected to assess the safety of this combination as well as provide an early indication of objective response rate in patients with metastatic triple negative breast cancer who have received at least one prior line of systemic therapy for metastatic disease. The study which is anticipated to start in the Q1 in 2026 will further inform us on a future Phase 2 program in triple negative breast cancer. We believe a significant treatment gap remains in the anti GD2 space in both pediatric and adult cancers. We're committed to supporting the advancement of these investigator sponsored studies through clinical development and working to unlock the untapped potential of maxitamab. Let me now hand the call over to Pete Freundshall.

Speaker 5

Thank you, Vignesh, and good morning, everyone. As you heard earlier, we recorded total Danielson net product revenues of $18,500,000 in the Q3 of 2024, representing a 7% decrease compared to $20,000,000 total Daniela net product revenues in the Q3 of 2023, primarily driven by decreased international and U. S. Revenues from a decline in U. S.

Speaker 5

And ex U. S. Order volumes. U. S.

Speaker 5

Danielza net product revenues were $15,300,000 $16,100,000 for the 3 months ended September 30, 2024 and 2023 respectively, representing a 5% decline. The decline was primarily due to an unfavorable price mix, partially offset by increased U. S. Volume of 5% during the Q3 of 2024 compared to the Q3 of 2023. Ex U.

Speaker 5

S. Net product revenues were $3,100,000 $3,900,000 for the 3 months ended September 30, 2024 and 2023, respectively, representing a 19% decline. The decline was primarily driven by decreased volume from Western Europe in the quarter. We received an inventory order from Cyclone of $1,700,000 in the 3rd quarter, but the revenue was reported in the 4th quarter due to cutoff timing issues. Our total Danielza net product revenues of $60,700,000 for the 9 months ended September 30, 2024 were relatively flat compared to $61,000,000 for the 9 months ended September 30, 2023.

Speaker 5

We did not have licensing revenue for the 3 months ended September 30, 2024. We did report $500,000 of licensing revenue in the 9 months ended September 30, 2024. We also reported $500,000 of licensing revenue for the 3 9 months ended September 30, 2023. Moving to operating expenses, our research and development expenses were $11,200,000 $36,800,000 for the quarter 9 months ended September 30, 2024, representing decreases of $4,200,000 $4,000,000 from $15,400,000 $40,800,000 for the quarter 9 months ended September 30, 2023. Selling, general and administrative expenses increased by $3,400,000 $8,500,000 to $13,600,000 $42,300,000 for the 3 9 months ended September 30, 2024 respectively compared to the same periods in 2023.

Speaker 5

The increase in selling, general administrative expenses for the 3 months ended September 30, 2024 was primarily attributable to a $1,200,000 increase related to our former Chief Financial Officer separation and consulting agreements and a $1,100,000 increase in personnel costs inclusive of stock based compensation and $500,000 in professional and consulting fees. The increase to selling, general and administrative expenses for the 9 months ended September 30, 2024 was primarily attributable to a net impact of 3,800,000 dollars related to 2 legal settlements that were finalized in the 9 months ended September 30, 2024. As previously mentioned, $1,200,000 increase related to our former Chief Financial Officer's separation agreement and consulting agreement. A $1,100,000 increase in personnel costs inclusive of stock based compensation and $800,000 in professional and consulting fees. We reported a net loss for the quarter ended September 30, 2024 of 7,000,000 dollars or negative $0.16 per basic and diluted share compared to a net loss of $7,700,000 or a negative $0.18 per basic and diluted share for the quarter ended September 30, 2023.

Speaker 5

In addition, we have reported a net loss for the 9 months ended September 30, 2024 of 22,900,000 dollars or negative $0.52 per basic and diluted share as compared to a net loss of $20,400,000 or a negative $0.47 per basic and diluted share for the 9 months ended September 30, 2023. The decrease in net loss for the 3 months ended September 30, 2024 was primarily driven by decreased operating expenses and a favorable impact from foreign currency transactions, partially offset by decreased product revenues net. The increase in the net loss for the 9 months ended September 30, 2024 was primarily driven by the previously mentioned 2 legal settlements with a net $3,800,000 impact. As mentioned earlier, we ended the Q3 of 2024 with cash and cash equivalents of $68,100,000 as compared to $78,600,000 dollars at year end 2023, representing a decrease of $10,500,000 year to date. Importantly, we continue to maintain a strong balance sheet, reporting $9,700,000 in cash outflows for the Q3 of 2024, primarily driven by cash payments on the 2 previously mentioned legal settlements paid within the quarter.

Speaker 5

Turning now to our full year 2024 guidance. We reiterate our full year 2024 total net revenue guidance to be in the range between $87,000,000 $95,000,000 dollars but we expect the revenues will come in, in the bottom half of that range. We continue to anticipate our operating expenses will remain in the range of between $115,000,000 $120,000,000 for the full year 2024, which is consistent with our prior guidance. And we expect our cash investment for the full year of 2024 to remain in the range of between $15,000,000 $20,000,000 which is consistent with our prior guidance. With a strong balance sheet and a focused strategy, we believe Ymabs is well positioned to execute on our strategic missions and priorities and to support the delivery of multiple anticipated near term milestones.

Speaker 5

This concludes the financial update and I will turn the call back over to Mike.

Speaker 2

Thank you for that overview, Pete. Now let's open the line for questions. Operator?

Operator

Thank you. We will now be conducting a question and answer The first question is from Etzerodharu from BMO Capital Markets. Please go ahead.

Speaker 6

Great. Thanks for taking the questions. One on Daniela and another on the GD2 SADA. So for Daniela, if you could talk a little bit more about the pricemix dynamic in the quarter? And is this something you expect to continue moving forward?

Speaker 6

And what are the potential offsets in the Q4? And then on GD2 SADA, you have no dose limiting tox, dose correlating to preclinical data. If you could talk through maybe the key criteria for dose selection for sort of the Part D of the study? Thanks. For the antibody specifically, the dose for the antibody specifically.

Speaker 6

Thanks.

Speaker 2

Sure, Esther. Thank you very much for that. I'll pass the first question on regarding the price mix to Sue and then bring it back for the protein. Sue?

Speaker 3

Thanks Mike. Thanks for the question. So we took an approximate $1,500,000 charge in Q3 for Medicaid related claims, for both period and out of the period. And so, due to that price mix, we saw a 5% decline in net revenues even in spite of having 5% increase in vials. And so with the adjustment, the sales would have been up 4% for both year over year and quarter over quarter.

Speaker 2

Thank you, Sue. So the second question you had was around the protein, the optimal protein dose on our GD2 SADA. So what we've done so far through the first six cohorts is we started at the 0.3 milligram per kilogram, escalated up to 3 milligram per kilogram and have since back that down to 1 milligram per kilogram shortening the window and looking at an optimized window. So to move that into Part B, for us it was nearing more of the preclinical PK data that we saw looking at the blood levels, understanding we want to dose near the nadir. And what we've seen so far with that is allowing us to then focus on the 1 milligram per kilogram and feel very confident that we're narrowing that down.

Speaker 2

So Vinesh, anything additional to that?

Speaker 4

Just to build on that. Obviously, we need to evaluate the dosimetry in the tumor as well as the normal tissues. And of course, the safety and all of this will contribute to the evaluation of the optimal dose and the dose interval.

Speaker 6

Great. Thank you.

Speaker 2

Thank you, Arthur.

Operator

The next question is from Lee Watsack from Cantor. Please go ahead.

Speaker 3

Hey, good morning. Thanks for taking our questions. I guess if you can comment on some of the swing factors for Q4 revenues as we're heading into the holidays, your confidence level of hitting that the lower end of the guide. And the second question is just for GD2 seluda. You're looking at a number of histology.

Speaker 3

So wondering if you can comment on the radio sensitivity of these tumor types?

Speaker 2

All right. Thank you, Lee. For the Q4 guidance, I'll pass you to Pete and allow Pete to expand on that.

Speaker 5

Lee, thanks for the question. With regards to the guidance, we feel very confident that we should land within the range of $87,000,000 to $95,000,000 We did highlight for you as part of the earnings call that we should most probably land in the lower half of that range. If you look at the Q3 results, although they were $18,500,000 as reported, we did highlight for you that the cyclone sales did land in the 4th quarter. So with the cyclone sales adjustment, with the Medicaid adjustment and then also the Noble or the timing of the Noble licensing deal, we most probably would have landed actually based upon the consensus numbers just about where the consensus numbers were for the Q3. So for the Q4, we still anticipate a very strong quarter and we anticipate to land somewhere in the lower half of basically the guidance range as we laid out for you guys between $87,000,000 $95,000,000 Hopefully that helps you, Lee.

Speaker 2

And Lee, your second question around the GD2 SADA and the radiosensitivity, I'll pass that on to Vinesh.

Speaker 4

Thank you. So just to remind everybody, the cancer that we have included in the 1,000 1 study include osteosarcoma, melanoma, soft tissue sarcoma, small cell lung cancer and in the latest cohort we added adult neuroblastoma. It's too soon to say what we've seen in terms of early indicators of sensitivity to radiation. As you know, the GD2 expression levels is quite heterogeneous in the solid tumors, variations within the tumor as well as antigen density. Hence, the rationale to include also had on neuroblastoma patients.

Speaker 4

So as we get more data on the evaluation of dosimetry and responses, we'll update the group here in terms of what we've seen in terms of radiation sensitivity.

Operator

The next question is from Alex Stranahan from Bank of America. Please go ahead.

Speaker 7

Hey, guys. Thanks for taking our questions. Just 2 from us. First, with moving your headquarters early next year, curious to hear the latest on your approach to manufacturing and whether you'll be making additional investments here as your SADA assets progress through the clinic? And then on the new deal in Japan, maybe outline how you see the commercial rollout going there and sort of the incremental TAM that TAM represents for Daniela?

Speaker 7

Thank you.

Speaker 2

Sure. Thanks, Alex. Our philosophy on manufacturing hasn't changed. We're in a unique position with both Daniela and our SADA platform that the way our current structure is, we're able to use contract manufacturing for our proteins, which allow us to rather than invest in brick and mortar, allows us to invest in the drugs themselves. And similar on the SADA platform, we're able to use the same network that we have for our SADA protein constructs and contract directly with isotope manufacturers for the production and caging of isotopes.

Speaker 2

So we're doing additional work with our proprietary chelators as we're looking to expand within the alpha and beta space as well as the PET that allow us then rather than again investing in manufacturing really invest in drug development. The second point, as we look at Japan, we've got a small clinical trial to do within Japan and that'll be limited to 6 patients to confirm, similar to what we've done in the U. S. In order to get that rolled out. So we expect to kick that off rather shortly and increase the overall ability to launch that product hopefully in the second half of twenty twenty five to early twenty twenty six.

Speaker 2

So as we move forward on that, as we look at the total addressable market, Japan is a significant healthcare market.

Speaker 5

But overall,

Speaker 2

it is a much smaller market than the U. S. And we'd expect to see incremental from that, but not necessarily a very large expansion of our total addressable market. Got it. Thanks.

Speaker 2

Thanks, Alex.

Operator

The next question is from Justin Walsh from Jones Trading. Please go ahead.

Speaker 7

Hi, thanks for taking the question. I'm curious what your thoughts are on the increasing numbers of players testing pre targeting approaches. And I'm specifically thinking about some preclinical data on another approach being tested by Roche and Aranomed that was at EANM, adding to the groups that we're already following. So do you think that this like provides additional validation for or confidence in what you're already trying to accomplish with SADA?

Speaker 2

Yes, it's a good question, Justin. I think as we look at this, any time you see more and more companies coming into it, it does validate what the theory is around providing maximum dose to the tumor, minimum off target and more importantly providing better logistics to get into shorter lived isotopes. So we welcome this from an intellectual point of view as well. The more smart people and smart companies you have working on this, the more likelihood you'll get more and more pre targeting products out to the patients and into the clinic. And again, what's extremely important about that as well is leveraging the existing infrastructure to get more patients treated without having to go to specific diagnostic suites.

Speaker 2

So we welcome that opportunity. I think there's a variety of methods in which to do this and time will tell which is optimal, which is right and there are always more than one right answer. So we wish the others much success as they move forward and it really allows us then to focus on what we can do well and what we will do well for the patients and practitioners.

Speaker 7

Great. Thanks for taking the question.

Speaker 4

Thanks, Justin.

Operator

The next question is from Mike Ilts from Morgan Stanley. Please go ahead.

Speaker 8

Hi, good morning. This is Rohit on for Mike. Thanks for taking our questions. Just going back to 3Q Danielle's sales, how much of the decline would you contribute to seasonality, competitors and the ongoing clinical trials? And I think you mentioned something on a change in estimate for Medicaid claims for the quarter.

Speaker 8

Can you just elaborate on that? Thank you.

Speaker 2

Sure. Thank you. Thank you very much. I guess we'll start backwards on this and I'll push pass it over to Pete to talk a little bit about what the Medicare looks like and what the changes are there and then we'll move over to Sue to talk a little bit about the volume and what we see as impacting that as well as potentially what the good news is in the way of volume.

Speaker 5

So good question. With regards to the Medicaid element of the sales mix for the U. S, the reality is the number of sites that we're selling into that have Medicaid 340 ks is continuing to increase a bit more relative to sites that have less of that presence in those sites. And so as we got into the Q3, we had an adjustment that was associated with both in quarter as well as previous quarter coming into this. And so to that note, there was about a $1,500,000 push down that we had to take in the quarter relative to that.

Speaker 5

So overall, we did report about $15,300,000 I think still alluded to this earlier. With the $1,500,000 we're at about $16,800,000 One thing that we did not really get into was there was also some timing related issues, specifically in shipments also within quarter that slipped into the Q4. That was about another $700,000 And so when you actually compare kind of where we were a year ago, Q3 at 16.1 with those adjustments, we would have landed somewhere around 17.5. And so actually our sales overall is kind of up. And that kind of correlates as you saw, we did have volume increases for the quarter.

Speaker 5

So again, there were some timing related things that fell in quarter that impacted us. But for the most part, it continues to reinforce our confidence with regards to kind of where the markets are, where Daniela is. So then I'll pass it over to Sue for a little bit more color here.

Speaker 3

Okay. Thanks, Pete. Thanks, Mike, for the question. Yes, I think, obviously, our mix continues to be about eighty-twenty with U. S.

Speaker 3

Being about 80% of our volume. And we have on all indicators, key performance indicators, grown quarter over quarter in terms of the number of physicians treating, the number of patients starts, number of physicians with 2 or more patients. And notably, the majority of our sales is coming from high volume centers, where our market share is higher than if you look at all centers together. And that we believe is really coming because of our new competitive campaign, which is enabling us to really talk about differentiating our core value in being able to still attain a complete response even in heavily pre treated patients and even in patients who are no longer responding to or have developed antibodies to prior anti GD2 therapy. So that is certainly how we're going after market share of unituxan.

Speaker 3

And we also, as we've mentioned, see volume in the Q4 coming from China due to the timing of that large shipment that Pete talked about.

Speaker 2

Great. Thanks, Sue. Thanks, Pete.

Operator

The next question is pardon me. The next question is from Jeff Jones from Oppenheimer. Please go ahead.

Speaker 8

Good morning, guys, and thanks for taking the question. 2 from us, 1 on Danielson and 1 on SADA. With respect to cash runway, which you projected into 2027, can you highlight what studies and work is included in there amongst, Daniela and SADA? And then for the SADA platform specifically, when might we hear more detail around future plans, targets, target selection and indication? Thanks.

Speaker 2

Thank you, Jeff. I'll pass the first part of your question on to Pete for cash runway and what we have planned and kind of how we're looking at that.

Speaker 5

Yes, Jeff. Good question. So previous quarters, we communicated that we have runway into 2027. We reiterated that as part of this quarter as well. Again, I would first start with our cash investment or burn for this year on a net basis relative to kind of what we where we set out guidance.

Speaker 5

So our guidance is $15,000,000 to $20,000,000 of investment this year over and above the proceeds cash inflows from Daniela. What we're seeing to date and we issued that as part of this earnings release is we're slightly over $10,000,000 year to date on that number. We do have some favorable things coming in now as part of the Q4. We mentioned the Noble licensing deal that $2,000,000 is coming in alongside some other things. So we're well on track to the lower end of that $15,000,000 to $20,000,000 range is kind of what we're anticipating for this year.

Speaker 5

That should land us kind of in the low 60s, most probably somewhere $60,000,000 to $65,000,000 I would skew more to the $65,000,000 number. And then kind of as we go forward, what our anticipated views around both investment and return on Daniela was that Daniela would continue to see some mild growth, call it single digits to maybe a low double digit number. In other view, we get good cash flows off of Daniela's moving forward over the next number of years. And then on the investment side of the equation, we anticipated that we would be investing in new SATA programs at least 1 to 2 every year. So that was kind of the thought process as we laid it out.

Speaker 5

As is the case, Jeff, most companies are going through kind of a revised operating plan cycle at this time of

Speaker 9

the

Speaker 5

year. When we issue our 10 ks in March, we'll issue new guidance for not only 2025, but also give you guys an update as to your thoughts around investment moving forward. So hopefully that helps you. Yes.

Speaker 2

And Jeff, as a follow-up to the second part of the question, we're actually right now in that process of evaluating a multitude of targets and narrowing them down to targets that really fit what we're doing here at Ymabs. So we're in that process and I would say in the early part of 2025, most likely Q1, you'll see a revised priority list, as well as specific timelines and what exactly we are going to be targeting moving forward. And as Pete discussed, we have plans invest in several targets and bring several programs per year into the clinic. So stay tuned for that, but that will happen in early 2025.

Speaker 5

Great. Appreciate that. Thanks guys.

Speaker 2

Absolutely. Thanks guys.

Operator

The next question is from David Nierengarten from Wedbush Securities. Please go ahead.

Speaker 9

Hey, thanks for taking my question. I was just wondering if you could tell us on your dose escalation and kind of push or pull back, I'm going to call it back to 1 milligram. Is there any, for SADA, sorry. Is there any differences in tumor types that drove that or tumor burden? Or was it just timing and PK?

Speaker 9

Like, I don't know if you could walk us through without giving us the data too early on, kind of what was what you were seeing that drove you to decide or look at the dose level? Thanks.

Speaker 2

Yes, David, that was a great question. We'll give you much more of that detail once we release it, but I'll give you the top line on this. So we've talked about this in the past. What we need to do with the radiopharmaceuticals in a pre targeting is paint the tumor and to cover those receptors without putting so much in the blood that we're taking a long time to clear it out. So we know the disassembly of SADA is concentration dependent.

Speaker 2

So when we model the preclinical data based on the mouse model, 1 milligram was the target based on that. We had the flexibility to go up to 10 times higher than that and started at 1 third of that. But the reality was we started at 1 third looking at it from a safety perspective, brought it through the 1 milligram and then 3x that at the 3 milligrams. And the PK was modeling what we saw in the preclinical. So it made sense for us to bring it back to that target level rather than go higher and extend the time in which we would wait for the isotope.

Speaker 2

So now it's just fine tuning that back in. It had nothing to do with tumor types. It had nothing to do with uptake. It had nothing to do with any of that. It was more of we felt that the being that the PK levels were modeling that of the preclinical data, that we narrow that down as a variable and bring it back into that range and start shortening the window, again, changing one variable at a time.

Speaker 2

So we feel very good about where that is. And again, it had nothing to do with any toxicity or anything else. It was really feeling that we had enough protein to paint the tumor and clear quickly enough from the bloodstream. Got it. Thanks.

Speaker 2

Thanks, David.

Operator

The next question is from Nicole Garmino from Truist Securities. Please go ahead.

Speaker 10

Good morning. Thanks for taking my question. I have 2 on SADA. First one, can you just talk

Operator

a little bit more about

Speaker 10

the dosimetry in which organs do you expect the drug to accumulate and more and what are the acceptable lutetium levels in kidney and liver?

Speaker 2

Yes, Nicole, that's a great question. I think when we look at this and understanding that both the SADA as well as the lutetium dota are renally eliminated, we would expect to see as far as off tumor for the kidneys and the bladder to be the highest the organ the highest impact to any organ. The second would be any kind of liver uptake or bone marrow. We're evaluating all of that as part of the clinical trial since again, this is the first in human. But I'm not right now, don't have any data to share on those and what they look like.

Speaker 2

And Vinesh, I don't know if there's anything from your side that you want to discuss as what are limits we're looking at as far as what we're trying to maintain below.

Speaker 4

Yes. In addition to what you just said, what we're expecting, dosimetry absorbed dose in tumor and of course off tumor tissues, one thing we can and we've already shared this with you in terms of the safety margins. So far, we've not seen any early indications of any safety issues, no dose limiting toxicities or treatment related serious adverse events. But further evaluation will go and we'll share with you more results as we get through soon.

Speaker 10

Okay, great. And then one quick question on your targets. Can you elaborate more on your target selection strategy and what are the parameters for how you're choosing your target priorities?

Speaker 2

Yes. We're working through that right now. We'll lay that out as part of the total strategy. It's not something we're ready to disclose at this point as we're walking through the list. But we are looking at many receptor modulated diseases.

Speaker 2

We're looking at unmet need as well as commercial potential. So there is a significant amount of criteria we're putting into this and this will be a living document for us. As we move forward and bring targets into the clinic, we'll be looking at the next 5 to 10 targets, how they are positioned both clinically and commercially at that point in time and can reprioritize as we move forward. So there are several criteria and we'll outline that as we bring this entire strategy forward.

Speaker 1

Great. Thank you.

Speaker 2

Thank you.

Operator

This concludes the question and answer session. I would like to turn the floor back over to Mike Rossi for closing

Speaker 2

comments. Great. Thank you everyone for joining us today to discuss our Q3 results and continued progress. We have a strong financial foundation and continue to believe we are uniquely positioned for future growth while advancing the clinical development of our differentiated radio immune therapy platform, sotaprit, to potentially deliver better and safer therapeutic options in the treatment of a number of serious diseases with unmet needs. We look forward to seeing many of you at upcoming investor meetings and medical meetings throughout the winter.

Speaker 2

If we didn't get to your question, you have additional questions, we're happy to schedule time with individual investors and answer those questions at that point in time. Thank you and have a great day.

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Earnings Conference Call
Y-mAbs Therapeutics Q3 2024
00:00 / 00:00