Everyone, welcome to the second day of Cantor Global Healthcare Conference. I am delighted to be joined today by Paul Peter Tak, the CEO of Candel Therapeutics. Welcome. So, Paul Peter Tak, kick us off by a quick overview of Candel. Yeah, well, thanks for having us. It's great to be here. Hi all. Candel Therapeutics develops viral immunotherapies for very difficult-to-treat solid tumors, and we've shown consistently positive data in early localized non-metastatic prostate cancer, area of huge unmet need, where the field is wide open, pancreatic cancer, non-small cell lung cancer, and for our second investigational medicine, also in recurrent high-grade glioma. Great, so CAN-2409, let's go through some of the basics. This is a fairly unique mechanism. Can you tell us how it works and why this is different to other oncolytic viruses or other viral approaches? Yeah, it's a first treatment actually using a whole different approach. It's viral immunotherapy that leads to in situ immunization against the patient's own tumor. So basically, we use CAN-2409 to educate the patient's own immune system how to recognize and eliminate their tumor cells at the site of the injection, but also at the uninjected, distant metastases. T he beauty from a patient perspective is that you only administer it twice or three times in a patient's life to get durable anti-tumor immunity, which is systemic. So it's unlike oncolytic viruses. It's actually not an oncolytic virus, but it leads to a vaccination effect and immunization effect, while it's at the same time not a vaccine. So some people find it difficult to get their head around it because they've never seen it before. But we've done very deep research showing the mechanism of action. It's really about teaching the immune system how to recognize the patient's tumor. It does get a really robust immune response. What is it about this type of cell death or the activity of CAN-2409 that drives such a strong immune response and abscopal effect, et cetera? Yeah, there are two important components. One is that based on the mechanism, you induce massive cell death in the tumor cells in the tumor microenvironment that you choose to educate the patient's own T cells how to recognize the tumor. Y ou get all these cancer antigens and cancer neoantigens released in the tumor microenvironment. T hen at the second time, at second place, because you're using adenovirus, this has a very strong pro-inflammatory effect. T he adenoviral capsid proteins are known to be very strong inducers of pro-inflammatory cytokines, chemokines, adhesion molecules, what have you. I n short, mediators of inflammation. T hat's why adenoviruses have been used very successfully in many vaccines to prevent infectious diseases. T hat combination leads to a very strong, durable, systemic anti-tumor immune response. Great. T here were a lot of indications you could have chosen, and you decided for localized prostate cancer as the primary indication for 2409. Why did you pick localized prostate cancer first? Yeah, it's true that this is a pan-solid tumor therapy, and we have data beyond what we have presented in our corporate deck. We have data in children with glioblastoma. We have data in adults with glioblastoma, all with very encouraging effects. We've injected it into the eye of children with retinoblastoma, cancer of the eye complicated by tumor microenvironment. We've published all of that, but we went through a rigorous prioritization when I joined this company five years ago and asked the following questions. What is the medical unmet need? What is the scientific reason to believe? What is the regulatory path forward? What is the commercial opportunity? O ther filters that we applied, so we went through rigorous prioritization, and we only focused on potential blockbuster indications, and of these, prostate cancer is the biggest one. Why? Because everybody else is focused on later stages of the disease. That's also why it's important to educate the community about what do you try to achieve in early, localized, newly diagnosed prostate cancer, because no medicine has been approved for that indication. We always say in the last 20 years, but actually the answer is ever. These patients can choose radical prostatectomy, major surgery, or radiotherapy, and the goal is to eliminate the tumor. There's curative intent, and so second, this is a very common cause of cancer in men. It's the second most common cause of cancer in men after all the skin cancers grouped together, and this problem has not been solved. First, this is still the most common cause of mortality, death due to cancer in men, although it takes a long time before you start to see that, 10, 15 years. It's a slowly growing tumor in most patients. But then there's this morbidity associated with local recurrence of the disease, local progression of the disease, local regional progression of the disease, all leading to signs and symptoms, development of metastases after more than 10 years, and then ultimately also mortality related to prostate cancer after 10, 15 years. H uge unmet need. This field is wide open because there's basically no competition. Why is there no competition? It took us 12 years to do this clinical trial. Which biotech company or pharma company would choose to do this? Actually, we did it. It's behind us. We achieved the primary endpoint, supported by secondary endpoint. N ow this field is wide open. T he short answer is incredible unmet need, big commercial opportunity. L et's just slightly dig into the unmet need a bit more. Tell us about the standard of care. How many patients elect for radical prostatectomy versus radiotherapy? T hen what's the role of androgen deprivation therapy in these patients? W hat are the outcomes or the adverse effects? Yeah, so we focus on the patients with newly diagnosed intermediate or high-risk prostate cancer who choose to get rid of that tumor. This is not about active surveillance in low-risk prostate cancer. This is about patients with more aggressive disease who want to eradicate that tumor. T hen they have two choices: surgery or radiotherapy. C urrently, the risk of recurrence, the chance of recurrence is about 30%. T hese patients are willing. In both cases. In both cases, kind of comparable, and these patients are willing to accept the risk of long-term complications of current standard of care, so think of urinary incontinence, erectile dysfunction, loss of quality of life, depression, which are all extremely common, more immediate after surgery, but they may also kick in over time after radiotherapy, and then although they have all these complications that they accept because they want to get rid of that tumor, there's still the chance of recurrence of 30%. That's why we explore a third therapeutic option, which is radiotherapy combined with CAN-2409, and we've shown that we can actually improve Disease-Free Survival, the absence of any evidence of cancer by 30%, and if you focus on prostate cancer-specific Disease-Free Survival, it's actually better measured. It's even 38% improvement, so what are the patient numbers we are talking about? Yeah. Currently, 65,000 patients per year in the U.S. alone will choose to undergo radiotherapy in the context of radical therapy. We believe this number may even go up. W ith 65,000 and a similar number in Europe, this is a huge market. This is very, very big. But what we heard based on the market research, and we may come back on that, we heard actually that this third option is expected to have better outcomes than the first surgery or the second radiotherapy only. T his may lead to a shift towards more patients choosing radiotherapy, but then combined with CAN2-409. One more, and that's the decision of a patient for which avenue they would choose. What makes a patient choose radical prostatectomy versus radiotherapy today? Yeah, one factor is the immediate impact of surgery on erectile dysfunction, which basically kicks in in all patients immediately. T hen there may be recovery, which may take years actually, over time. The same is true for urinary incontinence. There's this immediate effect. But then over time, things may improve. But then there's a psychological element. Some patients like it to just get rid of that tumor, right? J ust take it out. T ypically, patients are slightly younger who choose surgery over radiotherapy. Then other factors are comorbidity. Some patients are not able to undergo major surgery. T hen another point is that after failed surgery, if there's recurrence, you could still get radiotherapy, but it's more difficult to do this the other way around. T his is based on shared decision-making between the patient and the physician. A bout 50% will choose currently radiotherapy versus the other 50% will choose radical prostatectomy. Yeah. Okay, great. Very helpful context. C ongratulations on the positive Phase 3 of a very, very long 12-year study. Can you remind us of your study design and why you decided to combine with radiotherapy? Yeah, so we combined with radiotherapy based on preclinical experiments that we've done, where we could show that there is synergy in animal models of prostate cancer, so local radiotherapy may work. CAN-2409 alone works, but when you combine it, there's clear synergy. I t is related to the mechanism of action because ultimately we use CAN-2409 combined with a tablet that people will take for two weeks, which is called Valacyclovir, actually developed by my previous employer, GSK. U ltimately, that combination leads to the formation of a toxic metabolite, a nucleotide analog that will be incorporated in cells that exhibit DNA damage. T hey are damaged. R adiotherapy will actually induce DNA damage. T here's a very clear rationale that there's synergy. I t's also very easy and feasible from a practical point of view. These patients come to the clinic to get their radiotherapy for the second and the third administration of CAN-2409. We combine it. They have to go to the hospital anyway, and it's done in an outpatient clinic setting, so it's a very patient-friendly approach, and it's also like a one-off approach, although consisting of three administrations, but that's it, leading to durable anti-tumor immunity. I guess on the patient research there, can you just share with us what you found was the patient experience of going through the injection, maybe relative to biopsy? I know that you looked at that as well. Yeah, exactly. I'm a big fan of doing very extensive and very professional market research. W e ask, of course, radiation oncologists and urologists. They are the physicians who treat these patients. But to your point, I'm also a big fan of what I call patient in partnership. Let's ask the patients how they think about this. W e did this. We sent out surveys in a systematic way to the patients in our trials and basically asked the question, how did the study procedure that we inject CAN-2409 into the prostate, which is a minor procedure that takes about 20 minutes in an outpatient clinic, how does that compare to the previous biopsy that you underwent? Because that's how the diagnosis was established. M ost patients indicate it's the same as a routine standard of care biopsy or better tolerated. W hy better tolerated? It's a thinner needle, only 22 gauge needle, which is a very thin needle, and it's a very minor procedure, so you don't need anesthesia, basically, and patients can walk out of the clinic and off they go. Great. Y ou've shared with us some of the highlights from that trial. T he 30% risk reduction for DFS. Tell us about your conversations with the FDA. T here has been discussion of moving towards OS endpoints in cancer, but this is a very different situation where these patients do take a very long time to progress. W hy do you think DFS is acceptable? W hat have you learned from the FDA? It's a great point. F irst, I'm very happy with the strong emphasis by the FDA on Overall Survival in indications like pancreatic cancer and non-small cell lung cancer, rather than overall response rates where you look at CT scans or Progression-Free Survival, which can be quite meaningless, especially for the evaluation of immunotherapies. We have always said this, actually. That's why we chose Overall Survival in both pancreatic cancer and in non-small cell lung cancer as the gold standard endpoint. I always said this is what matters to the patients because they want to live longer with a good quality of life rather than seeing an improvement on the scan, and this is also important for the regulators. However, we have a higher hurdle in newly diagnosed prostate cancer. We do not want patients to live longer with cancer. We want them to live without cancer. There's curative intent. We want to prevent the fear of recurrence, cancer-related anxiety, the signs and symptoms due to recurrence of disease, as I discussed, the side effects in most patients due to surgery therapies like androgen deprivation therapy that have this chemical castration has a very negative impact in the majority of the patients. T hat's why we agreed with the FDA, repeatedly indicating that the primary endpoint would be Disease-Free Survival. Obviously, if a patient is cured of prostate cancer, they will not die because of prostate cancer 10, 50 years later. From a feasibility perspective, it's also impossible to design such a study. I mentioned already this took us 12 years. It would take a study of 15-20 years to show that you can improve Overall Survival. But again, this is not our primary goal. Our goal is to get rid of the tumor. That's the goal of the patient who chooses radical therapy. T his has not been based on just conversations with the FDA. This has been repeatedly agreed with the FDA under the SPA, the Special Protocol Assessment. T his has been reinforced by the new FDA, as I call it, with the data in hand. We went to the new FDA, and we were rewarded with an Regenerative Medicine Advanced Therapy (RMAT) designation, Regenerative Medicine Advanced Therapy designation. That's basically a breakthrough designation for gene therapy. T his has been reinforced. We have very regular contact with the FDA, which is a beautiful benefit of all the designations that we have, Fast Track designation, RMAT designation. Very helpful. You said that it would take maybe 15 to 20 years to see Overall Survival. You're already 12 or 13 years in. Will we see Overall Survival at some point in the future for the Phase 3 study? Yeah, we will continue to follow these patients because that's just the right thing to do. W e have a median follow-up in our trial of just a little bit more than 50 months, 50, right? T his is close to five years. It would take, we know that very well from the literature, at least 10 years to show a benefit in terms of mortality, Overall Survival. W e'll continue to follow these patients, but we don't expect to see any separation for Overall Survival curves in the next five years. A gain, that's also not what we expect that this is required. The goal is to show that there are no tumor cells anymore. W e've shown this convincingly and clearly, very statistically significantly at a microscopic level based on biopsies that we were requested by the FDA to take. That's the gold standard to detect cancer cells. L et's talk about the commercial opportunity here in localized prostate cancer. You mentioned there might be a shift from EBRT, sorry, from radical prostatectomy towards EBRT plus CAN-2409. What else are you hearing and what does your market research tell you is the appetite for a therapy like this? Yeah, so we've always been very active in terms of market research. W e've done this throughout the years. But now we could do it with the data in hand. W e did this very recently in May of this year. Very extensive market research. We're one of the best companies in the field, which is Globe Life Sciences, right? Market research is not just calling a medical oncologist, for example. Actually, medical oncologists typically do not see these patients because they're seen by urologists and radiation oncologists, right? You refer to a medical oncologist when there's advanced disease, when there's metastatic disease, when they need ADT and chemotherapy, et cetera. F irst, you need to choose the right people who actually treat these patients and who see them. U rologist and radiation oncologist. W e did very extensive market research. We interviewed, well, not we. Globe Life Sciences, an independent company, interviewed 30 key experts in the field, 20 in the U.S., 10 in Europe, in the U.S., half of them in academia, half of them in community centers, half of them urologists, half of them radiation oncologists. After having introduced the concept that we do not, like everybody else in advanced disease, try to improve Overall Survival, but that the hurdle is higher, that we try to actually achieve that goal of eradicating the tumor, 100% of the respondents said that they would actually use this approach. This was overwhelmingly positive market research. Very interestingly, recently we were contacted by a financial institution that was doing due diligence on Candel Therapeutics. Without us knowing this, they did their own external market research. They did it in a very professional way. They also reached out to urologists, radiation oncologists, and they called us to share their findings. It was identical. It was an extremely positive response in terms of market research. We believe that this will be implemented in all candidates for radiotherapy who choose to get their tumor eradicated. Y ou told us a little bit about the logistics and the patient experience, but just tell us a bit more about who performs the injection. Is it guided? Any other things to be aware of there about implementation? Yeah, so the key physician here is a urologist, right? These are the physicians who will typically establish the diagnosis of newly diagnosed localized prostate cancer. T hey are surgeons. W hat do they do for a living? They put needles into prostates every day, right? Including prostate biopsies. F or them, this is super straightforward and simple, done in the outpatient clinic. No special expertise or equipment needed. Actually, most of our patients in the clinical trial, which was a very large trial, 745 patients, were actually involved in community centers, right? But sometimes it was more difficult to do a venipuncture than an intraprostate injection. I'm not kidding. It's serious. T his is a very simple procedure in their hands. Takes 15-20 minutes. The other physicians who do this are radiation oncologists. They are also used to manipulate the prostate in the context of normal clinical care because they have an approach that they sometimes use for radiotherapy called brachytherapy, where they insert needles for local radiation. This is not done in our clinical trial, but for them, it's also completely straightforward. T hese are the two types of physicians that will use this approach, and it's typically ultrasound-guided. Okay, great. A ny thoughts on pricing here? Yeah, of course, it's difficult to comment on pricing, but I will say the following. We have included in our slide deck, in our corporate deck that people can find on the website, a kind of illustrative range of prices for medicines that have been approved for more advanced disease. Globe Life Sciences that I just referred to had done market research in the past. Based on that, we have our commercial forecast. We're talking about multi-billion opportunity per year, right? It's a very large opportunity. But now we've done very recently additional work, really pressure testing the assumptions with payers. I was very pleased to see that the price is probably going to be significantly higher than we anticipated in our models. T his really seemed to resonate actually with payers. A gain, we've been quite conservative in our estimates. L et's talk about the timeline here. Tell us sort of the current status, the plans to file, and what's happening between the Phase 3, end of the Phase 3 and filing. Yeah, we've done a lot of work in the past with our external partner in manufacturing, which is SAFC. This is Merck Millipore in California, one of the largest manufacturers of adenoviral gene constructs in the world. They're absolutely fantastic. We had already locked the whole process, et cetera, before the data readout. But then in December, when we knew that we hit the primary endpoint supported by secondary endpoint, one day later, we could press all the buttons. We brought in the top team from Novartis to oversee it from a Candel perspective. W e've really started to scale up manufacturing. That just takes time. You need to produce commercial batches. You need to put it on stability. That is just standard work in the industry. W e've made very good progress. T here's no slipping timelines whatsoever. I don't think any pharma company could go faster than this collaboration between these experts at SAFC combined with the Candel team. W hat have we done recently? We have actually successfully completed three commercial scale runs. W e're very happy with the outcome there. We're doing a lot of work in terms of analytical assay qualification and validation. Then because there's always new methods and modernization of the process, we need to show the comparability of the new product compared to the old product that was used in the Phase 3 trial. W e've been working on a new product for several years now, right? But you will still need to show that. W e are working on a comparability study. Again, this is standard practice. We're working with the FDA. What is it exactly that they want to see? Maybe it's good to point out that an analytical comparability study is not done in patients, but actually in the lab, right? I t's relatively straightforward. You don't need to do a trial for that. W e're going to show things like what is the purity, right? What are the characteristics of the molecule, et cetera. W e are in regular contact with the FDA to discuss our ideas about what these experiments look like. T hen finally, we have prepared a so-called biodistribution study and shedding study because it's a viral gene construct. Y ou always need to show that also for the new product. That's not a big study, and that's not going to take a long time. That's a study in probably 20–25 patients. You're not looking at clinical outcomes. You're looking at can you detect the virus in which body compartment. I t's very straightforward. We will use that opportunity actually to also add some very interesting deep immunological biomarker research because that's very important. Not only to ultimately sell the medicine because physicians want to know exactly what the state of the art science is, how does it exactly work? but it's also very important from a strategic perspective. If you talk to big pharma companies, they want to see what happens to the T-cell receptor repertoire, et cetera, after administration. It's important from a commercial perspective because it will give the salesforce a great story to tell. It will also give us actually new catalysts. There will be multiple catalysts during the next year that we have not announced yet. T his study is not going to take a lot of time because basically it's all based on analysis of blood and tissue samples from these patients. V ery good progress, regular contact with the FDA about this. W e will know exactly what they want to see, and we'll deliver this in a timely manner, and we're still on track. Remind us when you're planning to file? Yeah, we've always said I'm always very boring, and I try to do exactly what we promise or more, that we are still on track for Q4 2026. W e're sort of halfway now, right? V ery soon I will be able to say next year we plan for BLA submission, and by working very closely with the FDA in this whole process and generating additional data, we believe we will be in a very strong position. Let's talk about lung cancer. T ell us about the role of CAN-2409 in non-small cell lung cancer. What have we seen, and what are we going to see? We're very excited also about the non-small cell lung cancer program. Actually, that's where we are exactly at the other spectrum of the treatment paradigm because we focus on patients who are failed standard of care. Most of these patients have progressive metastatic disease. Despite treatment with immune checkpoint inhibitors, most of them have failed platinum-based chemotherapy. They will get in standard of care docetaxel second line chemotherapy, which is associated with high toxicity, second, a median Overall Survival of less than one year, so these patients have a very, very poor prognosis. What we've done, we kept these patients on the immune checkpoint inhibitor that they failed on, and we just gave them two administrations of CAN-2409 delivered into the tumor, and we're talking about metastatic disease. We learned from this study that it doesn't seem to matter whether you inject this into the primary tumor in the lung or, for example, into a lymph node with metastasis. W e kept that open in the study. W e learned from that. Y ou just choose one or two of these tumors that are easy to reach, to access, to teach, again, the immune cells throughout the body how to recognize and kill these tumor cells. T his is done because we've shown in previous experiments, both in mice and in men, that we are able to convert non-responders to immune checkpoint inhibitors into responders. T hat's exactly what we've seen. We spoke about Overall Survival. This should be the primary endpoint in non-small cell lung cancer. We have shown that where you expected median Overall Survival of less than a year, we've observed it of more than 25 months. I think this is unheard of. This is in a population with very poor baseline prognostic factors. It's all supported by very deep immunological biomarker research. We are writing it up now for a top journal. W e are preparing without any delay the start of a pivotal Phase 3 clinical trial. W e have had a very successful meeting, end of Phase 2 meeting with the FDA recently, where we are aligned what it's going to look like, right? This needs to be a randomized clinical trial where we will select patients with progressive metastatic non-squamous non-small cell lung cancer. W e keep them on pembrolizumab. We will focus on pembrolizumab, Keytruda. W e will just give them two administrations of CAN-2409. That's one arm, and the other will discontinue pembrolizumab as you would do in normal standard of care and will start docetaxel. Primary endpoint is Overall Survival, so we've done the scientific advisory boards. We have had the FDA engagement. We're finalizing the protocol without any delay. All of this is what I call enabling work that's in the current budget. I've always said we will start the enrollment of the first patient after successful completion of some form of non-dilutive funding, and we don't expect that this will lead to any delay, so everything is on track. We will believe that we will do this trial. R emind us on the subject of funding how much cash you have. T hen we haven't even touched on GBM. J ust other milestones for us to be aware of in the next year or so. Yeah, so we've announced recently that we have a little bit more than $100 million in the bank. I t's not too bad at all. We have a runway into Q1 2027, and we will make sure that we don't shorten that runway. Recently, we needed to do some extra commercial activities. That's why we did a very small round with heavy insider participation, including myself, also to vote with our feet that we really believe in these programs. This will create value is our strong belief. A ll of this work is in the runway, right? We'll get to BLA submission and beyond. We do the enabling work in pancreatic cancer and in lung cancer. We will advance the Phase 1b trial in glioblastoma, which is externally funded by the Break Through Cancer Foundation. Meanwhile, we have quite a lot of different options at this time point, including forms of non-dilutive funding. W e will. I call that trigger spend. We start these studies when we have secured that funding. We believe we will be able to do that. Great. Fantastic. Thank you, Paul Peter Tak. This was. Great pleasure. Thank you so much. Thank you so much.