Good morning, everyone. Thanks for being here. My name is James Shin. I'm one of the biotech analysts at Wells Fargo. Today I'm joined up here with the CEO of Sutro Biopharma. Bill, thank you for being here. Thanks, James. It's a pleasure to be here. Thank you so much. For those that aren't familiar with Sutro, do you mind giving us a quick overview? Yeah. Sutro is a very unique company in the way in which we make what we believe are best-in-class cancer therapeutics. Most people make cancer therapeutics using antibodies that are derived from CHO cells. We have a cell-free protein synthesis technology that is unique and differentiated, and I can explain some of the characteristics of that in a minute. Suffice it to say that today we have six different programs in clinical development as a result of the technology platform that we've uniquely got access to. Four of those are cancer therapeutics that are antibody-drug conjugates. One of them, I can now say, is an IL-2 derivative that is working in combination with Keytruda, we hope. The final one is a 20-valent pneumococcal conjugate vaccine. The underpinning technology is the same for all of these different molecules. It's just the way we apply the technology is different depending on what we're trying to achieve with an end product. Got it. You know, when we think of Sutro, we think of ADCs, and you kind of just touched on all these kind of vaccines. You got an IL-2. Like, can we just touch a little bit more on XpressCF? It's cell-free, and other people are not doing this for some reason. Yeah. Well, challenge with cell-free, cell-free was invented about 40 years-50 years ago as a concept, sometimes known as in vitro transcription and translation. Really what you're doing is you're hijacking the ribosomal machinery that a cell uses to produce large molecules, and you're separating it from the cell. Yep. In order to create an antibody, you have to transfect the cell, and it grows up, and then you ultimately purify out to get the large molecule of interest to you. For us, we just take the inner machinery, and we've set it aside, put it in a 96-well plate, if you will. We introduce plasmid DNA that codes for the large molecule of interest. Then without the constraints of a living organism, we're actually able to produce that antibody. Or in our case, for an antibody-drug conjugate, we have an antibody that has, in very site-specific manner, locations in which we have placed a non-natural amino acid that is proprietary to Sutro. That non-natural amino acid is an ideal anchoring moiety to connect a linker and a warhead. Whether it's a cleavable linker or a non-cleavable linker, whether it is a tubulin inhibitor class of warhead or a topoisomerase class of warhead or what have you, we have the ability to create those molecules. Now, a key differentiator for us is also the fact that we can do this very rapidly. The reaction to make a large molecule with a non-natural amino acid in it happens in less than 24 hours. From a discovery paradigm, instead of taking weeks doing transient cell expression to get enough to do some experiments and then having to convert to a stable cell line, we can overnight make many different variants, and we can start to understand structure-activity relationship for very complicated large molecules. It's not only what's the right antibody for an antibody-drug conjugate. That's an important element, but then what is the right type of linker? There are many different ones to choose from. In fact, linker technologies continue to evolve. What is the right warhead? What is the right payload? There are many different technologies that are out there, and those continue to evolve. For us, we've added another dimension in our immunostimulatory antibody-drug conjugate, which is what is the right immune stimulating agent? Could it be a toll-like receptor? Could it be a STING agonist? What's the right one to add in that? You can imagine from a protein engineering standpoint, it's not intuitive, it's not predictable. You actually have to run the experiment, and you have to run the experiment multiple times, and you have to do it rapidly. One of our secret sauce is our ability to make a homogeneous molecule that then allows us to compare what's in well 1 versus well 2 versus well 506, right? Yeah. Then winnow those down so that we identify what we think is a molecule that has the optimal properties to move forward in the clinic. Now, that's true of an antibody-drug conjugate. It's true of an IADC. It's true of the cytokine derivative. We're just making a cytokine and then derivatizing it using our non-natural amino acid. Or in the case of the pneumococcal conjugate vaccine, the protein carrier to which the polysaccharides are conjugated actually has six non-natural amino acids in it in a site-specific way that allows them to really optimize the vaccine and avoid carrier suppression, which is really a limiting factor for existing, I'll call them old school vaccine technologies. In that way, it's a nice application of our platform technology, but one that wasn't core to us. Our spin out Vaxcyte is the one pursuing that for that application. We'll touch on Vaxcyte a little bit later, but you kind of just gone over cell-free's benefits, right? It's homogeneous, it's fast, it's scalable. You also touched upon this non-natural amino acids. You can precision place your linkers, your payloads, everything. You can mix and match and all that. Not everyone is talking about this, but what is the advantage of this, like, precision placement that you can do? Well, you would think, and certainly common knowledge when we started our discovery efforts in antibody-drug conjugates in the 2010, 2011 timeframe. Common knowledge was, you know, you just, when you attach a linker and warhead, you just didn't wanna screw up the antibody because that's your targeting vehicle. That's your drug. You know, as long as you know, had a molecule, and these are heterogeneous molecules because the chemistries are not specific enough to allow you to know precisely, at least back in the day, they weren't, and this is true of almost all approved ADCs today. They're not specific enough to allow you to say it's at position Y304 that the attachment site occurs. It actually can be in multiple locations because they're cysteine or lysines that can get conjugated to, and you can't control which cysteines or lysines are conjugated. Now, over time, the industry is starting to evolve that and to have much more control and much more precision engineering. From the outset, though, in the 2011 timeframe, Sutro has been involved in precise engineering. When we put a non-natural amino acid in, and we can put it anywhere in an antibody structure that we want, it goes uniquely to that position, and it stays there. It doesn't go anyplace else, and that's one of the beauties of the technology that we evolved through the years. It turns out that it matters where you put it. One of the earliest experiments we did was to make trastuzumab and put a non-natural amino acid throughout the entire sequence of trastuzumab. Then we attached a linker and a warhead, the same linker, the same warhead, and the same drug-to-antibody ratio, and we then just profiled them all. Yeah. What we found was that for a number of them, when you put the linker and the warhead in a particular location, the antibody just fell apart. It wasn't a good location. In a large number of locations, the antibody wasn't affected at all. If your rubric is, you know, just don't screw up the functionality of the antibody, we weren't doing that. You thought, okay, any one of those should be okay. Pre-clinically looking at in vitro models, they all looked pretty much identical. When you put them, however, in animal models, they then started to separate, and performance of the molecule in vivo really depended on location. Some would be more potent, some would be less potent. Some would have the desired cell kill ability, others seemed to have lost that cell kill ability. Molecules that looked the same, in fact, weren't, and the only differentiating factor was location. Now, it would have been lovely to say that once you find one location for one antibody drug conjugate, that's the right location for all antibody drug conjugates. The fact of the matter is, and the industry knows this, it's no longer the case that one size fits all. Yeah. You actually have to make each antibody-drug conjugate fit for purpose. That means the right antibody, the right linker, the right warhead, the right placement. The industry is slowly getting there. I think, you know, there are some great examples of success in our industry, but they've been hard won over the last 10-15 years. We're at a really nice point in our inflection as a platform-oriented company with products to be able to consolidate all of the learnings of the industry and apply them for our next generation product candidates as well. When topoisomerase linker warhead started to show promise, lo and behold, Sutro now has in our ROR1 ADC program a topoisomerase exatecan warhead with a drug-to-antibody ratio of eight. There's a lot of learning that can happen and quick consolidation, and I think most companies have access to one technology and one approach, and that's great if you've got the right molecule for that approach. The next molecule, that may not be the right approach for. The next one, probably not either. You have to have a robust technology in order to go after many different types of cancers. That's what we built. With six things in the clinic, I'm excited to see how the clinical data progresses over the course of the next 12 months. You're gonna have some important data coming out soon, relatively soon for STRO-002. Durability is the focus, it seems. Longer is gonna be better, but. Yeah, longer is always better. Could you give us a benchmark of what you hope to see and what you think you need to see? You know, that's a good question. I think as a reminder, we're treating patients who have advanced ovarian cancer. They've been through all of the approved therapies, and frankly, their next therapeutic choice would be chemotherapy, which is relatively ineffective. Right. I think the response rates for chemotherapy are about 12%, and the durability is about three or four months. We all know what the side effect profile of chemotherapy looks like. It's not surprising that for a lot of the women who reach this advanced stage of their cancer, they opt not to have the incremental chemotherapy and just go on some palliative care. It's a very sick patient population that we're going after. I think since standard of care is three and half months of durability for that 12% who respond, from a regulatory standpoint, you have to be meaningfully better than that. You would want to see, you know, probably no less than a 20% response rate. We've obviously got initial data that suggests a much higher response rate in the 40s or 50% rate at this point in time. You know, 20% is probably the low bar for response rate. For durability, if it's three and half months or so, you would like to see durability in the five-month or longer range. Again, that's a meaningful benefit. Ultimately, though, progression-free survival is gonna be an important mark for approval. Because in the cancer space, you have opportunities for accelerated approval, and we can talk about the opportunity that I think Sutro has for STRO-002 in that vein, but the full approval is then based on progression-free survival. That's really the hallmark. You know, for cancer patients, they love to hear that you've got control of the disease and that they have a partial response or there are so few of these complete responses we get in these advanced ovarian cancer patients. They're really pretty fluky, but that sounds great and gives the patient hope. If the response is not durable, then, you know, what have you really achieved? Yeah. For many women, the cancer RECIST criteria suggests that a response is a shrinkage of your tumor by 30% or more. You have to have that response confirmed with a second scan, subsequently. That's great. If you can maintain the patient with a partial or complete response for a good period of time, they're thrilled. Many women still have a benefit but don't have a response. Their disease is under control. How we measure progression-free survival tells you, are you controlling the disease? Sure. How long are you controlling the disease? Duration of response is only for those who respond. Progression-free survival is for the entire patient population that you're studying, and that's really the linchpin to a final full approval for a therapy in this space. Bill, are you saying that we'll get PFS in later this year then, too? I think we will see PFS for the dose expansion phase of our trial later this year. Fantastic. Just going back to the OR real quick, and I'm just trying to get a full picture of how the data packs look like. I think back in November last year, you had 33 out of 43 patients that were evaluable. Fair to assume that maybe we'll have a little less than 10 more patients also to look at? The entire 44 cohort will be read out when we present the data set. Not all of those patients, as you've alluded to, got to a scan. Yeah. From a RECIST criteria standpoint, we'll have everybody who made it to the scan to include in the data set. Can you say whether or not you know whether what the TPS status of these patients are? Are they high folate receptor or low folate? Yeah. One of the interesting things about where we are in the development of the drug was not only are we trying to figure out what's the right dose for these patients, is it 5.2? Is it 4.3? What is the right therapeutic benefit versus tolerability decision trade-off to be made here? What is the right expression profile that maximizes the probability of success? Now, when we presented our interim data, we saw that fully 40%, there was a 40% response rate for women who had a tumor proportion score above 25%. What that means is on a slide, a biopsy slide, you take a look at the cells and see what percentage of those cells stain positive for folate receptor alpha. If you're above 25%, then that was associated with a 40% response rate. If you were 25% or lower, the response rate was less than 20%. It's a pretty clear demarcation point for us based on 33 of 44 patients. We have data on all 44 patients, and that will inform our selection of the tumor proportion score on a going-forward basis. We'll update that when we release our data later this year as well. Perfect. It sounds like you've already met with FDA. We have. You kind of have discussed registrational study design. You've also mentioned PF, PFS could get you potentially a full approval. Is it just fair to assume that accelerated approval is on the table? You've got that single-arm accelerated approval. Is that on the table? It is on the table. I think what we wanted to do with FDA, and we didn't have a full data set, but we had enough that we felt like it was complete enough to have the regulatory conversation. We wanted to ask the question, there's a lot of therapies that are undergoing clinical development. Is platinum-resistant ovarian cancer still a significant unmet medical need such that an accelerated approval could be allowable? Now, one of the things that we did share with FDA was the opportunity for a broader patient population than other agents are studying. That was a meaningful differentiating point because when they look at standard of care, we expect that if we use a TPS cutoff point of greater than 25%, we could potentially be benefiting 70%-80% of the women with platinum-resistant ovarian cancer. Other drugs that are in clinical development benefit somewhere between 20% and 40% of the patient population. Standard of care for the overall patient population is not what it is for that subset. It's still chemotherapy in the main for the vast majority of platinum-resistant ovarian cancer patients. We wanted to understand from FDA how their thinking was relative to opportunities for accelerated approval, in part because of the other therapies that are in development, but also in part because of some regulatory chatter in Washington about whether or not accelerated approval is really the right way to be thinking about drug development. Right. Fortunately, the current commissioner of the FDA, Dr. Califf, is very bullish on accelerated approval. Now, you have to have, you know, a meaningfully better response rate. Yes. and durability than standard of care, and you also have to be clear that you're committing to a confirmatory trial so that you can establish the full benefit. Yeah. Some of the regulatory speak has resulted from some folks perhaps not being able to fully pursue their confirmatory trial in a prompt and timely manner. I don't see that as being an issue in ovarian cancer. I think there are lots of different strategies that other companies are using and that we will employ to ensure that we can have a robust confirmatory trial in a reasonable period of time that it would allow you to go from an accelerated approval label to full approval. When you talked to FDA, did they have any qualms or questions about your approach using a starting dose and then tapering upon seeing grade 4? Was that okay? Was it like, "The data's fine, you can do this." Was there any qualms about that or? We did have an extensive discussion with them about our dosing, results and what our plans were on a going forward basis. I'm gonna be really excited to talk to you later this year about what the conclusions were from those conversations. We'll get the final dose for STRO-002 at that time too? We will tell you what the trial design fully looks like. Fantastic. Okay. It's a competitive space. There's another drug. They've had some tox issues. You had some neutropenia issues, but that seems pretty common in the gyn-onc world, I would say, right? I think oncologists kind of go through this. You know, do you think there's a sense of relief that there was no ocular tox, no ILD from clinicians? Like, do they kind of make the converse, like, "Data was great. Thank you. You don't have the tox. I don't have to worry about this." Like what can you share from your- Yeah. You know, that's an interesting question. I think the reality is that no company wants to have an ocular side effect for their cancer therapy. These are advanced cancer patients who know that their remaining life is limited by their cancer. They would like to be able to enjoy as good a quality of life as they can. That's why chemotherapy. Quality of life is agreed. Isn't always used. Yeah. Yeah ... because of the quality of life issue. For ocular disorders, blurred vision in particular, you know, you can diagnose keratopathy or other ocular disorders. Blurred vision is a patient-reported outcome. Yes. They understand that they are not having the same quality of life that they had, and the only way to get rid of the blurred vision is to hold off the therapy or go down to a dose that probably doesn't have the same efficacy potential. Nobody wants ocular toxicity. I think for the way we design our molecules, we really haven't seen ocular toxicity to date, in any of the molecules that we've made that we can talk publicly about. No meaningful ocular toxicity signal for our O one molecule. It's a different target. Sure a different disease. It's a blood cancer, but none there and so forth, none here. You mentioned interstitial lung disease. That is also something that is concerning to physicians, even at as low a level as grade two. Yeah. Because it's something that while they can be on surveillance for, it can rapidly progress, and be much more dangerous. For neutropenia, the physicians who treat these women use a variety of agents before they get to STRO-002 that cause neutropenia. What they would be concerned about is if we add high levels of febrile neutropenia. In fact, we have almost anecdotal cases of febrile neutropenia. In the main, it's something that is asymptomatic. It goes away about a week after it's first detected. If you're on a once every three-week dosing regimen, which is our standard dosing regimen to date, you measure the lab values before you give the next dose. If the patient is neutropenic, you have to wait until they recover. Turns out they recover a week later. You're either on a every three-week or every four-week dosing cycle, and the patient is asymptomatic. It's really something that they know how to manage, and they're not really that fussed about it as a practicing oncologist. Whereas for an ocular disorder, it has to be referred out. They have to coordinate for ILD. There are other issues that they need to take precautions for. We think from a commercial standpoint, assuming that we have the right efficacy and durability and PFS scores, it's gonna be a drug that physicians will use and have a preference for, particularly given the larger market opportunity. Commercial. This is something of a debate at this point, but a lot of people would say, you know, a competitor's product is coming pretty soon at the end of November. Like, I think you alluded to it, they're going after a smaller market. You know, their assay only gives them maybe access to 20, a little bit more than 20 patients. Can you make up that ground? Like, I mean, there's obviously some meat on the bone for you guys to go after, even if they come first. Like, even if they're first to market, there's a lot of patients that can still be addressed with your drug. Is that correct? That's correct. They will have a label that will restrict them to patients who have this high expression level, based on the assay that we use. If you're not there, then y ou're not eligible for treatment. I think that leaves an unencumbered segment for us. The question that you have to ask yourself, assuming that we're able to enter the market with that large of a patient opportunity, is if you're a practicing physician, if I test the individual, and I've got a 70% or 80% chance of being able to treat them as soon as those test results come back with STRO-002, and I only have a 20%-35% chance of them, which drug am I gonna prefer? You know- Yeah The testing we like to think is exact, but for TPS 2+, there's a subjective quality of determining the intensity of the staining. Maybe one person sees something as a 2, another person sees it as a 1. You know, you know, maybe the person isn't really the right one to get benefit. In our case, because it's just what% stained positive. It's more objective. It's more empirical. Yeah. It is. It's very easy for them to do. We think that when we get to a commercial head-to-head position, even for the broader patients, we should have the edge, in terms of being not first to market, but being best in class opportunity. I'm gonna jump to STRO-003. Sure. It's your new toy. Yep. What's the next steps? When are you gonna get the IND filed, and when do we get the trial started? You know, I ask my team that all the time. We wanted to ensure that we were incorporating the best technology that we have available for STRO-003, and that's why you see a new linker in the beta-glucuronidase linker. You see a new warhead in the exatecan warhead, and you see a DAR of 8, which is more than we have previously evolved before. One of the great things about our platform is that we are able to do all of these things robustly from a research standpoint. The next steps are, and this is started before, but to make certain that you have a robust CMC process that can sustain that, not only for the GLP tox work that you need to do, but actually so that you have a process that is ready for prime time for clinical development, and you see a path to commercial development. We are pursuing the last phases of the preclinical work, including the GLP tox work, and we are working on the CMC strategy for those component parts. You know, they're new to us in a sense that we haven't scaled them up the way we've scaled up the component parts for STRO-001 and STRO-002. Sure. That process is ongoing. When we announced STRO-003 in the summer, we said, usually for molecules at this stage, you can say it's gonna be about 18 months from where we are to the clinic. That's just a rule of thumb. That's what I'm sticking with at this point in time. I expect as we get into 2023, I will have much more granularity and be able to give a more specific response to that. Right now, you know, order of magnitude is about 18 months from when we disclosed STRO-003's existence. There's other ROR1 ADCs out there VLS-101. Yep. There's another one, CS5001. They seem to be going after a wide variety of indications from lymphoma, leukemia, triple negative breast, solids like non-small cell, really big indications. Is it fair to assume that your ROR1 could go through a similar basket, kind of take that large approach as well? The answer is yes. Let me tell you why. One of the things we were excited about was that preclinically we saw a lot of robust activity, even in animal models that are low expression level of the target. Yeah. That was very encouraging to us because there is such a wide array of solid and liquid tumors that express ROR1 that it makes sense to really think about a basket trial approach, particularly if you can hit tumor types that are lower in expression. That's the working model that we have in mind, a broad basket study as the first one to make certain that we're seeing the right signal. Again, like we did with STRO-002 or with STRO-001, you know, is there a right threshold that enriches for a patient population and maximizes the probability of therapeutic benefit? That's gonna be something that we look at very carefully with respect to STRO-001. We're excited that others are pioneering the broad applicability of this target, and we expect to be learning from them as they present their data. That will perhaps inform maybe some patient numbers where we bias a little more to one particular than another, even though there's a basket trial. Okay. I wanna get to the pipeline. There's a lot of stuff in the pipeline we gotta get to. Okay. We're running short on time. You still showed tissue factor in your slides. Is that still on the table? Tissue factor is still on the table. We were more excited about ROR1 as the next molecule up, and so we prioritized that. Tissue factor has some very interesting activity. There are others, as you know, who are pursuing that as an ADC. Yeah. Again, I think we're bringing to bear our best thinking about how to actually make that molecule sing as a best in class molecule. I really wanted to touch on this, is the iADC Astellas collaboration. You guys got a nice check from them. There's three targets. I know it's still early discovery phase. Any timelines on when we will see these targets be unveiled? Yes, I have them in my mind. I had to try. Okay. Last one, your vaccine, VAX-24, is coming out later this year. Yeah. You guys hold about 1.6 million shares. Yes. What's the company's ultimate plan for Vaxcyte? Well, you know, when we thought about the evolution of our company and understood the power of our technology for creation of novel vaccines, we really didn't see a path forward to be both an oncology company and a vaccine company. We spun them out, we retained ownership, and now that's 1.6 million shares and a 4% royalty. I always thought we are a manufacturing partner of theirs. We supply extract and reagents, and we make a little bit of money in that. I always thought that Vaxcyte represented an opportunity for us to have an alternative revenue stream that would fund our company. The 1.6 million shares will provide additional capital to our company. You know, I think there's a major inflection point for them in the October, November timeframe when their phase 1/2 data get revealed. We're gonna be opportunistic about making certain that those shares do provide additional capital to fund the continuing development of STRO-002, STRO-003, STRO-001, and other things that we've got ongoing. I'm gonna do one more if I can. Yep. First patient for M1231. This is the EGFR MUC1 specific. You guys dosed them in the middle of the year. Any timelines for when we can have data? I can't speak for EMD Serono, but I would sure hope we would see some data from them next year. Next year. Bill, that's all my questions. Thanks, James. Thank you so much. Appreciate it. Everyone, thank you. Thank you. I appreciate the opportunity to be here. Thank you.