Welcome to day one of the 2022 Bank of America Healthcare Conference. Thank you for joining this session with NextCure. My name is Alec Stranahan. I'm Vice President and Senior Biotech Analyst covering NextCure at B of A. It's my pleasure to be joined by Michael Richman, President and CEO of NextCure. I believe Michael's gonna run through some slides up front to get started, and then we'll go into Q&A after that. With that, Michael, over to you. Thanks, Alec. Yeah. Thank you very much, Alec, and it's a real pleasure to be here. I'd like to thank B of A for the opportunity to present NextCure. NextCure is a company in Beltsville, Maryland. We're celebrating a little over six years at really building a fully integrated organization focused on next generation immuno-medicines. This is our forward-looking statement. I always like to start with this slide. This is our three Ps, what really sets the stage for how we're building NextCure. What we'll walk through today quickly is our pipeline and the progress we've made. This is a newsworthy year for us since we have four ongoing clinical trials and a fifth based on an IND we'll be filing later this year. I'll walk you through our two phase 2 studies, both in monotherapy and in combination for NC318. We've got 2 phase 1 studies that will also be updated second half of this year, outlining the safety and clinical effects we've observed, as well as our plans for moving forward into a phase 2. Our fourth program, which will be our fourth IND, pretty much in a six and a half year period, focused on an anti-LAIR-1 antibody, and we'll be entering the clinic later this year in AML. Beyond the pipeline, as I mentioned, we're fully integrated, so we have a platform that really sets the stage for building an IND engine and sustainability and value creation for the organization moving forward. We've also spent a lot of time modifying how we're developing products and how we're differentiating our candidates, which are novel first in class and proprietary in this very competitive immuno-oncology space. This really focuses on patient selection, making sure that we're identifying those subjects that we believe will be most responsive to our therapy. We've invested quite heavily in biomarkers, looking at critical reagents, assays and analytics that really supports the mechanistic studies that we're observing in patients and the correlative effects that we'll see in clinical responses. We're also extensively looking at combination therapies that we think will synergize with our targets moving forward. We have a discovery platform, we call it FIND-IO. It basically walks through the entire human proteome, looking at those proteins that either stimulate or suppress the immune system. Then finally, the third P, people. We have an experienced team. We've been doing this a long time. We've navigated through troubled waters, such as today's economy, and we've really, I feel very confident in the programs that we're advancing. We have a lot of significant momentum, and I'll talk a little bit about some of the milestones that we'll be hitting this year. NC318, NC410, NC762, all of those programs are, the stage has been set for updates on those programs second half of this year. The pipeline continues to build momentum. As I mentioned, we have an experienced team, and as of last quarter, we have about $201 million on the balance sheet, which provides more than enough runway to execute on our plan and to advance these programs forward. This is our pipeline slide. I'll walk quickly through each of the programs, but more importantly, let me kind of just point you to the box on the right. The box on the right really outlines the second half of this year as it relates to providing an update on our lead program, NC318, both in a monotherapy setting and in a combo setting. We'll provide an update on our plans moving forward for NC410, also second half of this year. Similarly, NC762 also will be updated this year. Finally, we'll be providing an IND on our fourth program, fourth quarter this year. I should just point out that we own worldwide rights to all of our programs, so it sets the stage for not only with respect to building a valuable pipeline, but partnership opportunities. Let me tell you a little bit about NC318. This target is Siglec-15. S15s expressed both on tumors and on macrophages. It creates an immunosuppressive environment that allows the tumor to grow. What we've done in the case of NC318 is to develop a novel antibody that strips down that immunosuppression and allows the T-cells to be activated to kill the tumor. Currently, we're in a phase 2 study looking at lung, breast, and head and neck cancer. We've demonstrated important evidence of disease control based on the phase 1 and phase 2 studies we've done to date. Now we're moving forward in selecting patients using a novel CLIA-validated immunohistochemistry test that selects for those patients that are S-15 positive and that we think will be most responsive to therapy. Our second program, NC410, is really kind of a paradigmatic shift. This particular protein focuses on LAIR-2. LAIR-2 is a fusion protein. It acts as a natural decoy to activate the immune system. Mother Nature has already handed us this particular target. What we've done in creating NC410 is create a biomimic of the LAIR-2 fusion, which enables us to activate T-cells and restore immune function. This particular candidate basically binds collagen within the ECM, not your equity capital markets, our extracellular matrix, and by remodeling collagen within the ECM, you're actually changing the architecture of the tumor. Why is that important? By changing the architecture of the tumor, it allows the T-cells to come in, attack the tumor, kill it, to restore immune function. We presented a lot of the initial clinical data at SITC last year, also with respect to a lot of biomarker data. Our third program, NC762, is a humanized monoclonal antibody against B7-H4. This is a coinhibitory molecule overexpressed on many different tumor types. In particular, you see it in gynecological cancers like breast and ovarian cancer. We're working our way through the phase one dose escalation studies, and we'll also be providing an update on this unique mechanism of action of this molecule later this year. Finally, our fourth program, NC525. We've learned a lot about the LAIR pathway in the context of NC410. This is an antibody targeting LAIR-1. This is a diversification away from solid tumors into the hematological malignancy space, and we'll be taking this program forward and looking at AML. Just want to give you that, some of those brief comments and a highlight with respect to the pipeline and the four assets that we're currently pursuing. We have a discovery pipeline supporting that, coming behind that. Finally, I should add, by being fully integrated, we have our own GMP manufacturing facility. We have 2000 liters of S-scale. While many companies are looking to outsource to CDMOs, all the clinical trials that we're pursuing today are being supported by clinical material manufactured at NextCure. Thank you for listening, and Alec, I'll turn it back to you. All right. Thanks for that intro, Michael. We'll jump into the Q&A now. Obviously a lot going on in the pipeline. Maybe we can just start with NC318 since that's been your lead asset. We saw some early responses in the phase 1 unselected population, obviously. I guess the phase 2 is continuing to enroll. Could you maybe talk about the Siglec-15 patient selection? Has this been implemented and is this really your go-forward approach, not only for NC318, but also for your other programs as well. Yeah, great question. We've learned a lot. We've been in this business a long time, and we have to get three things right as a company. We have to get the target right, the candidate, whether it's an antibody or fusion protein. I think just as importantly, the patients, we have to go into the right patients that we think will be most responsive. Yeah, we have developed a CLIA-validated immunohistochemistry test that recognizes Siglec-15 on biopsies from patients. What we've learned from our 49-person phase 1 study and our 47-person phase 2 study was that we seem to be having an effect on looking at disease control. What we're trying to do in the case of this amended phase 2 is kinda act as a tipping point to advance those program or advance those patients into more formal responses. Okay. With the redesigned study now we're selecting patients based on biopsies that they've provided, with consent. They go through a central lab where we do the immunohistochemistry testing, and those that are Siglec-15 positive will now be included in the study and be treated with NC318. To your question, yes, we're taking those learnings. As a young company, we're always learning, so we're taking that information and we're applying it to NC410, where we've also developed a test that's being CLIA-validated. We'll be able to select for those patients that expressing LAIR-1. Then similarly in our third program, NC762, we're also developing a similar immunohistochemistry test. With that said, as we're also developing extensive biomarker tools that will enable us to get a better understanding of how these drugs are functioning in patients. Right. You know, one of the unfortunate downsides, I guess, of being a trailblazer with unique targets is that sometimes you need to make your own assays for detecting those proteins. Could you just sort of walk us through, you know, maybe the challenges of building this out in-house, and are you gonna become a diagnostic company at some point? Yeah, great question. We've invested quite heavily in bioanalytical tools as well as biomarkers. We, by having our own manufacturing, we develop all the critical reagents. We, let's see, generate about 100 different proteins a year. We generate the reagents, we develop the assays, and now we're building all the analytics. The analytics become important 'cause we could cross-fertilize datasets from each of our clinical trials within given tumor types. We're learning a lot. I don't think we'll be going into the diagnostic world, but certainly some of these assays may have applications not only in diagnosing disease but actually monitoring disease. When we start looking at modulating the immune system, we can look at maintenance therapy, and some of these assays that we develop may play into that. We're now in the process. I think it comes on in August, our GLP lab. Usually when samples are taken from patients, they're sent to a central lab. They do the test based on what we've created, and they send us the data. The problem with that is we've already enrolled a lot of patients, so the biomarker data is always trailing. What we're doing now, we're constantly modifying how we're doing product development. Now the samples will come directly from the sites after they come out from the patients. They'll be sent to NextCure. We have the tests available. We'll run the tests, we'll do the analytics, and then they just walk down the hall to the clinical group and provide them that data in real time. Mm-hmm. We're gonna get pharmacokinetic data in real time, pharmacodynamic data in real time, biomarker data in real time, and all that plays into really helping the clinicians adapt their trial into going into the right patients in the right way. Mm-hmm. It's been a real kinda learning curve in a very short period of time. Right. I guess in terms of Siglec-15 expression, you'll be selecting patients based on their baseline expression. Is your expectation that, you know, expression could change? Mm-hmm. Following therapy? I guess how would you know, monitor that and address it? Yeah. I think just looking at expression and gene deregulation, these targets are constantly changing. It is a dynamic process, as we've seen in the case of PD-L1 and PD-1. I'm not sure we have enough data with respect to changes of expression of Siglec-15. Those individuals that have responded no longer express Siglec-15, so, you know, they've been taken out of the equation. I do believe by detecting at least Siglec-15 on the tumor and also the infiltrating macrophages, we could come up with certain understanding of expression levels within a given tumor type. Over time, we'll be able to correlate that hopefully with responses, and we'll also be able to evaluate the dynamic changes, if any. Right. You're, you know, preemptively addressing those through your combos too, right? Exactly, yeah. The NC318, you're right, we're doing a combination study in collaboration with our founding institution at Yale University. This is in lung cancer, where they're combining NC318 with KEYTRUDA. Merck is kindly providing the drug free of charge, which is good for a biotech company. That study is currently enrolling. We're working very closely with them to determine whether or not there are certain synergistic effects with NC318 and KEYTRUDA. While we're looking at the combination, what's important to note is we're not treating at the same time. We're now looking at NC318 weekly, and then every three weeks, the patients will get KEYTRUDA. That provides a real important insight. Mm-hmm. into understanding not just an immune target, but the immune system. It is a sequence of events in the system on what needs to be triggered first and what needs to be triggered second. In our combination studies, we're spending a lot of time not just throwing two things together, we're really understanding the immunological effects of what needs to come first. We're learning a lot through that process. I guess, what sort of resolution in the study do you get in terms of, you know, monitoring the patient? Is it weekly or is it every three weeks when they get KEYTRUDA? Yeah. In this particular case, obviously, these patients are always being monitored based on, you know, samples that we collect. Sometimes it's weekly as we continue to treat, you know, progresses. In the combination, we're taking more samples more frequently because of that separation in dosing. Right. Very exciting. Looking forward to seeing that data as well. Me too. later this year. Exactly. Exactly. Well, maybe we can move on to 410. This is your layer one targeted therapy. You know, could you know, maybe talk about layer one, you know, its involvement in the ECM and, you know, your preclinical observations sort of supporting its activity? Yeah. LAIR-1's a really exciting molecule, and it's expressed on T cells and other myeloid cells, and it binds predominantly collagen within the tumor, which makes it somewhat unique in its profile. What happened somewhere along the way, mother nature duplicated the LAIR-1 gene, called LAIR-2. Mm-hmm. This is only found in higher human primates, so you don't find it in a lot of other animals. It's a very high order of modulating the immune system. What layer two does is acts as a natural decoy to bind collagen and to shut down that immunosuppressive environment. In other words, it's activating the T cells. What we've done at NextCure is just copy what mother nature has already given us. We created a biomimic of layer two. We figured if layer two is good for the system, more layer two would even be better. Mm-hmm. This is exactly what's been played out in our preclinical studies, and now what we're observing clinically. In our preclinical studies, we actually can activate T cells. We can kill tumors. We've been fairly proactive on building biomarker tools to understanding this mechanism of action. I think the most exciting data is the combination data that we've generated with Jeff Schlom's group at NCI, the National Cancer Institute, where they've looked at bintrafusp alfa, which is a PD-L1 TGF-β trap molecule with NC410. They've also looked at it in context of just PD-L1, and you basically flatline the tumor growth in mice. In fact, if you go back and challenge those mice, the tumors don't come back. Mm-hmm. Having been in this business for 15 years, very rarely do you see such an important effect. What does that mean clinically? Well, we started the phase 1 study, and we updated the phase 1 clinical trial, at least through the first five dose cohorts at SITC last year. We've seen some stable disease in a small number of patients, but most importantly was the biomarker evaluations that we did, Alec. We looked at soluble LAIR-1, soluble LAIR-2, T cells, cytokines, chemokines, et cetera. What we saw was exactly what correlates with what we've observed preclinically, where we're seeing a lot of changes in some of these biomarkers that we hope will ultimately correlate with disease. Mm-hmm. I think the most important finding was knowing that it binds collagen. And NC410 remodeling collagen, what happens to all that collagen? Well, it comes into the bloodstream as collagen degradation products we call CDPs, and you could actually measure this in the blood. In some of the early patients that we looked at, you could see this increased level of these collagen degradation products. Mechanistically, the drug is doing what we need it to do. The challenge for moving forward will be, you know, how we design the trial. Do we go in monotherapy? Do we go in combination studies? The combination data has been pretty exquisite. Right. Right. I guess just level setting ahead of the next interim update, you know, should we expect higher doses, maybe a deeper look on the efficacy point as well? Yeah, that's a great question. Well, you know, we're working our way through the dose escalation cohorts. You know, we haven't hit that DLT or IMTD maximum tolerated dose. Mm. We're probably going to be somewhere in the middle, you know, with respect to our dose selection. Mm. Currently we're going every two weeks. We'll probably continue to stay with that. If we do a combination, we'll probably modulate what that regimen looks like. Mm. The purpose of the update later this year will to talk about safety and obviously clinical observations we've made in the phase 1, but most importantly that recommended phase 2 dose, what patients or tumor types we'll be embarking on, and how we design the trial in the context either as either a mono or combo study. Right. I was gonna ask you, does the phase 2 portion already include a combo arm, or is that something you may add post it? Yeah, great question again. We're learning a lot. You know, in the old days we would just do a phase 1 monotherapy, and then we would kind of segue into a combination study. Because of the preclinical data being so strong in the case of NC410 and PD-L1, we may kind of jump the gun a little bit and maybe start with a combo and then add in a mono arm later on. Mm. We're changing our thinking a little bit, and this is being driven first and foremost by the science, second, the clinical, data that we're generating, and then third, probably the balance sheet. You know, where do we wanna basically invest to get the maximum effect, and outcomes for the program and the patients. Right. Your pipeline's expanding as well. You recently added NC525 for AML. Maybe we can transition there since it's another LAIR-targeted therapy. You know, I guess could you just walk us through the mechanism of, you know, NC525? You know, I think one unique aspect is that it can spare the more stem-like cells of the hematopoietic system. You know, is the thought that LAIR-1 is primarily expressed on the LSC and is that, you know, did that go into your design of the molecule? Yeah. This is, again, you know, through our knowledge and the building of know-how of understanding the layer one, layer two pathway. It was quite a surprise when we started looking at hematological malignancies and the expression profile of layer one. Mm. As you mentioned, you see it highly expressed on blast cells and leukemic stem cells. Through a lot of the animal studies, we've looked at certain CDX models, PDX models, and quite surprisingly and promising is we could kill those blast and leukemic stem cells and, like you said, preserve the hematopoietic stem progenitor cells. That's really exciting. That's one of those programs, the data just keeps getting better and better. You know, lots of times, you know, you're doing experiments and you're generating more and more questions and trying to get some understanding of the answers. We're really excited about this program. In fact, it's the candidate's already in the 200-liter bioreactor. I think it's going into the 1,000-liter bioreactor, I think later this week. That sets the stage for producing the clinical material that will support the phase 1 that we start either the end of this year, beginning of next year. You know, I guess what's left for the IND filing? Is it just getting the manufacturing to a good level to support the clinical study, or are there some other preclinical experiments you wanna run? Yeah. What's usually, you know, why does it take so long to get into patients? It's usually the tox studies. You know, the tox studies are pretty straightforward with respect to rodent and non-human primate studies. The challenge comes in is all the report writing. I think toxicologists maybe take a little bit extra time to write these reports, but it takes a long time. The IND is currently being drafted. You know, we've got the clinical section that's being put together. We've got the CMC section that is coming together as we manufacture. Then obviously the tox component, which is always kinda somewhat of the last item to check off on the critical path. Right. So far all is good. Great. We're flying through the pipeline, so let's do NC762 next. Initial data, clinical data back half of this year, right? You know, what can we expect, sort of around the scope of that data? Yeah. NC762 is our anti-B7-H4 program. This is a traditional 3-by-3 phase 1 safety and tolerability design study. We'll be reporting on all the dose cohorts. We may backfill some of the dose cohorts if we wanna generate some additional safety or more, you know, meaningful information. We'll provide an update on the demographics, safety, tolerability, any clinical outcomes that we observe, and then some biomarker studies will probably be included in that data set. And then most importantly, the plans moving forward into phase 2 as we kind of advance into some of the gynecological tumor types. Okay. That was gonna be my next question. You know, in terms of the literature, your preclinical work, you know, B7-H4 as a target, are there any tumors that sort of jump out as maybe being more amenable? Yeah. It's expressed in a lot of different tumor types, but at different levels. If you look at it in the context of ovarian cancer, it's like 90%. It's just really, really high. Breast cancer is high. Fallopian tube cancer is high. Even in looking at prostate cancer. Maybe somewhat hormonal related. We're still learning about that, but it's in lung cancer and all the other tumor types. In the phase one, we're looking at a whole basket of indications, but as we always do, as we advance into phase two, we'll probably pick maybe three or four of those indications, and I think ovarian and lung will probably be at the top of the list. Okay. Just on the balance of, you know, expression and then, you know, addressable market probably, right? Exactly. That's right. Got it. Obviously B7-H4 has been implicated in other disease areas outside of oncology as well. I think, you know, the FIND-IO platform, you know, you've always had sort of a lens to applying your, you know, target discovery to indications outside of oncology. You know, would there be any plan to take seven six two or another asset to, say, autoimmunity or something like that? You know, we do have a discovery program, and we're always looking at the yin yang of modulating the immune system. It's kind of like, you know, anti-CTLA-4 for cancer and CTLA-4 fusion proteins, Orencia for autoimmune disease. For B7-H4, we know it well. Our last company, we actually developed a B7-H4 fusion protein. We actually took it into the clinic in RA, but when the company got sold, unfortunately the program was kind of put on the back burner. B7-H4 fusion protein makes a lot of sense. We're currently not pursuing it, but would love to have the opportunity to. The preclinical data set for B7H4 IG was pretty phenomenal in diabetes, rheumatoid arthritis, MS, lupus, Sjögren's. It does have definitely immune properties. We'll see how that develops in the future. Right. You said in your prepared remarks, you know, the whole pipeline currently is wholly owned, which is great from an economic standpoint. You get all of the upside, if they hit. You have said that you know, would intend to file maybe one IND per year. That's sort of the aspirational goal. I guess at this point, you know, are you sort of satisfied with the scope of your pipeline? You know, obviously there's you know, tons of potential targets that could come out of Find IO that you could pursue. I guess would you know, seek to partner for the development of those targets? We have a pretty extensive business development effort. We can't do everything. We have a lot on our plate right now, and as we advance these programs from a clinical development perspective, obviously the costs go up. With that said, we can still file one IND per year. But I think we're gonna be much more selective in raising the bar. These are novel targets. There's a correlative risk that comes along with novelty. But we're also in the field of looking at combination therapies. Some of our earlier targets were already in discussions with potential partners. A lot of companies out there interested in feeding their own pipeline. They don't wanna look at another feeding one. Yeah. They're looking at things that are different. Yeah, right now we have a lot on our plate. We constantly, you know, we're driven by science. We're fully integrated, so we can do things in a much more capital efficient manner because we have the manufacturing. Right. It's not a constraint like a lot of companies have, you know. As soon as we have a candidate, we're making a master cell bank internally. Now we could freeze it for, you know, budget reasons, or we could partner it, or when we have a slot in our manufacturing schedule, we could just make enough material. We could do some tox work on the side. There's a lot of flexibility. Obviously, if any of our clinical stage programs move forward, as a young company, we're gonna need that global clin reg infrastructure. I think that's going to really set the stage for entering into a partnership that provides those capabilities. Right. I mean, you know, given the current biotech landscape, you know, having a strong cash balance is becoming increasingly important, right? You mentioned that you have just over, I think, $200 million- Mm-hmm. on hand at the end of last year. You know, your OpEx, you know, is below your peers, at least from what we've seen. You know, I guess how do you prioritize investment into the pipeline and driving those forward versus, you know, maybe bringing new assets forward? Yeah. Right now the clinical programs are getting pretty much the majority of the financial support. I think what we've done at NextCure, and I think I wish a lot of other companies did it, is, you know, you hire a lot of smart people, these scientists, these chemical engineers, they can do a lot. You know, they're on the critical path, and the money is going in the direction where we're gonna build value for shareholders and patients alike. There's some downtime every so often, and you can just sit and read, or you can actually move some of these other programs forward. Pretty much NextCure is about 90 employees, and each of them is well focused on the deliverables at hand. Yeah. which we talked about, but a lot of them have, you know, a lot of side programs that are moving along, but at different rates. Right. Yeah. Right. Okay. Well, with that, I think we're up for time. I really wanna thank you and the team for coming out to Vegas and during the conference and for running through your company. Really appreciate it. Well, thank you very much, Alec. I appreciate it. All right. Thanks. Thanks, everybody.