Great. Good afternoon. Welcome to Barclays Healthcare Global Conference. Of course, you can email me and my associates if you have questions. My name is Pete Lawson. I'm one of the biotech analysts at Barclays covering mid-cap oncology, and really delighted to have with us the CEO from Xencor, Bassil Dahiyat. I guess the first thing really for me is always like fantastic breadth of development over the years. Like the way you kind of view your technology in that antibody space and kind of how it differentiates. I know, you know, now it's kind of changed to a certain degree because you're thinking, you know, bispecifics, et cetera. Just kind of what's the differentiation within that core that pharma companies want to partner with you? The issue of differentiation with biologics technology and antibody technology in particular is the competitive intensity is so high that the cutting edge is always running away from you. You have to sprint to keep up with it or even better, to be at the forefront of it. You know, about 16, 17 years ago, we pioneered the engineering of the bottom half of antibodies, the Fc domains, to control half-life, to control effector functions. Beyond that, a few years later, we started investing in developing a robust and very modular platform for bispecific antibodies, which now is in, I don't know, there may be seven or eight programs in the clinic between Xencor and our partners, maybe even more by today. Again, the field moves on. Competitors emerge, copycats emerge. The subsequent wave of innovation that we've been pushing and pioneering that really gives us our differentiation now is identifying the biology and the immune system that we can now target with these bispecific tools and coming up with the antibody tools to engage them. In particular, our CD28 technology and our new format for CD3 bispecifics. These are both T-cell engagers, but in a different way. Our 2+1 format and our CD28s are what offer, I think, a cutting-edge capability that's beyond what other companies have that has attracted a lot of pharma interest. We've done a couple of transactions with Janssen on our CD28 toolkit. We've got our own first program in the clinic. That's how you stay differentiated. You always have to push your research engine harder and harder. Perfect. Thank you. I guess thinking about the bispecific, so your PD-1/CTLA-4, you know, interesting combination, kind of where you are for the prostate study that's in phase II, kind of how's that going for enrollment, and when should we expect to see data? I would put that in the context of, you know, what are we doing with our pipeline and what are the key drivers and priorities for this year. I would say Vudalimab, our PD-1/CTLA-4 bispecific that we engineered to be more selective for engagement of just double checkpoint positive cells, is one of our priorities. I would say that is about enrolling our phase II studies ongoing now in castrate-resistant prostate cancer, the first of which is in combination with chemotherapy or PARP inhibitor. Last year, we did our safety run in, zeroed in now on our chemo regimen, a de-intensified chemo regimen that we now are using, and we've been enrolling well. A second phase II study is a monotherapy study in clinically defined high-risk mCRPC. A key goal for that program is to enroll those studies, and we'll guide on data timing a little bit later on in the year as we get closer. The other big priority for us is enrollment in our IL-2 program for regulatory T- cells in autoimmune disease. Not an IL-2 for cancer like we're used to hearing about a lot, but an autoimmune disease, and that's establishing a dosing regimen that we hope can be a longer interval dosing regimen for autoimmune disease than the competitive molecules in the class. It's advancing our other newer bispecifics, these T-cell engagers, our CD28 and our renal cell carcinoma CD3 program. That's the context. I would say now going back to Vudalimab, the enrollment's going well. We've zeroed in on our chemotherapy combination dose. These agents are very active. Vudalimab is active, and we did demonstrate as a monotherapy in phase 1 that it seems to have a differentiated tolerability profile, an improved tolerability profile over combination of PD-1 and CTLA-4 antibodies used together. We had fewer of the sort of characteristic CTLA-4 blockade, AEs that often cause discontinuations like colitis. That's allowing us to combine with chemo, and now figuring out the right balance there. I think we've got it. That's enrolling well, and the monotherapy is enrolling well. The next stop for that program is efficacy data, right? We'll guide on timing for that soon. That's really the go, no go, for the program. Perfect. You changed the intensity of the chemotherapy, kind of how does that impact efficacy? How does that change how we should be looking at readouts as well? Well, when we initially started this study, we kind of went with a maximal chemo approach across the range of metastatic prostate cancer, mCRPC. We used the doublet of a platinum agent, carboplatin, with a taxane, cabazitaxel, across all chemo-eligible patients. Those would be people who have aggressive variant mutations that are known and identified, people that don't have targetable mutations, and people who've progressed after a PARP therapy. We used maximal doublet platinum taxane chemo for everybody, even though the NCCN guidelines are only to offer that really high-intensity toxic chemo to the aggressive variant people. We wanted maximal efficacy. What we did was we backed off to match the standard practice, which is aggressive variant, you get the platinum taxane doublet, but just the taxane for the other folks, right? Now that we're matching that, we're hopeful that it all, you know, the tolerability profile improves enough that we don't have to worry about discontinuations from too intense a chemo regimen. I would say that we're now moving into where the standard is, whereas we've been super aggressive on pushing for efficacy earlier. I feel pretty good that we can still think of the benchmarks where the maybe the most important benchmark is cabazitaxel alone, right? Where you typically see a pretty poor durability, less than six months of PFS and about a 30% response rate. Durability is, I think, really key, but initially we'll just have OR data to guide us. We need to hit that bar in the chemo combo. Gotcha. Okay. That's a nice bar setting for us about what we need to see in that data set. That's kind of like your internal go forward bar. Right. Right. Okay. Kind of, I guess, thoughts beyond prostate cancer? You know, checkpoints are very widely usable, and PD-1 and CTLA-4 blockade can have a lot of use and a lot of indications. You've got to think of the competitive intensity and the potential differentiation. Recently we noted data from a competitor program at AstraZeneca with a pretty similarly designed PD-1/ CTLA-4 bispecific, really the sort of the closest similarity to Vudalimab. That was in front line lung cancer, which definitely made us take note. Very big opportunity dominated by PD-1 plus chemo, pembro plus chemo, and they showed better durability in a small, albeit very small, phase I study. I think that opens the door in our thinking to examine that avenue for Vudalimab. We haven't committed to any plans yet. We're still assessing feasibility and what exploration of that indication might be. We know that AZ is pushing with multiple phase III now they're gonna try to start this year. I think given the scale of the opportunity and the size of the space, there's a, you know, there's certainly opportunity. We just have to figure out exactly best how to attack it. I'll note that the similarity between frontline lung and prostate cancer is the need for combining with chemotherapy to sort of position yourself against what you're competing against. These bispecifics offer the promise of that, though we have to prove it, that these bispecifics can de-intensify the toxicity that you get with combination therapy, say PD-1/CTLA-4 antibody, to allow the chemo combos. Also, they're both in checkpoint- therapy-naive patients, whether it's in the front line setting for lung or in the prostate cancer setting where checkpoints aren't used front line, right? I think that's an important scientific point, that how you use a checkpoint, they're probably best used in a setting that is naive to prior checkpoint therapy. Gotcha. Okay. I guess with Astra in the space and the strategy, how does that evolve? Do you go after areas where Astra is not touching, or do you think you can run faster than Astra? I think that we wanna use the validation that another company has found here and decide whether we wanna pursue it in the same indication based on the scope, the size of the opportunity space. I think in lung cancer, it's enormous, and there's, I think, room for multiple agents, right? This is such early days, we have to see. Having a large company ahead of us doesn't necessarily preclude in an indication of that scale, pursuit. Gotcha. Do you think you can differentiate on the molecule itself? Is there elements there, safety, efficacy? We know that the molecules are similar with one significant difference, which is our affinity and potency is about 10-fold less, which we purposely designed to try to approach Vudalimab as a way to make dual checkpoint blockade safer. How that plays out clinically, currently the data sets that we can compare is too early and too small. We'll find out as we go forward. We don't know how that's gonna play out. It's certainly something we're keeping our eye on. Gotcha. Okay. I'd love to talk through your RCC program, so your T-cell engager, your ENPP3, kind of how enrollment's going and kind of when we could see initial data. Yeah. That's a CD3 bispecific against a target expressed, really brightly on nearly all patients with clear cell renal cell carcinoma, ENPP3. I would say that the enrollment's going really well. There's an unmet need, and I think investigator community recognizes this, for agents that do something different than the checkpoint inhibitor or a VEGF receptor, tyrosine kinase inhibitor, which dominates front line, they're used in combination. After that, patients really don't have many options other than retrying a VEGF TKI or salvage chemo. A cytotoxic antibody approach like a CD3 against a tumor-associated target, there's really not a lot there. There's an absolute need there, and given that the CR rate in front line, even with the best therapies, is around 12%, there's a lot of patients that will progress. It's a big opportunity with a lot of unmet need. That molecule was designed based on the really clean expression pattern of ENPP3, giving you a large magnitude of difference between tumor tissue and healthy tissue. We now have the CD3 engineering tools to dial that in and to get to just the heavily expressing tissue and avoid the low expressing healthy tissue. At least we've demonstrated that really nicely pre-clinically, and we hope it plays out clinically. By using this new 2+1 format, where we bind avidly to the high expressing cells, but on low expressing cells, each arm of the two that bind the tumor antigen individually, they don't work great. You need to have a lot of antigen present to get both to grab on. We bring in the CD3 with a modest potency. All of these design tools that we've learned from the last half decade of you making CD3s and using them in the clinic are coming to bear. You know, there's clinical experience with the ENPP3, but at the moment, no competition. Antibody drug conjugate was tried about five or six years ago, saw good responses, but had ocular toxicity that stopped the program that was very likely a class effect of the payload. It's really a great opportunity to bring CD3s and cytotoxic antibodies into a therapeutic area that needs it. It's going well. It's early. We just started dosing in Q3, and the goal this year is to try to build it, get our doses up higher where we start seeing activity. Gotcha. What are the other learnings from the ADCs in the, in that ENPP3 space? I would say that it really is that this target, if you can hit it with a cytotoxic antibody, you can create responses in advanced RCC. They saw multiple responses. That's a beautiful validation that this target has potential. And it validated the basic science that initially drove us to the target, which is the beautiful expression pattern of healthy here and tumor tissue way up here, for ENPP3. Gotcha. I know I get this question from time to time, kind of what's the best approach there? Is it like a better ADC or is it... What's better? You know, yeah, that's a great question. I think that our control of CD3 bispecifics has improved a lot since the early days of the BiTE technology. Now I think they offer the potential for really very little off target toxicity if used properly. Whereas ADCs, I think that's always gonna be a challenge with the systemic tox that you have to manage. On- target tox is a different thing. If you're engineered your molecule so that it's killing a lot of the target cells and they're on healthy tissue, that can be a challenge. I think these new CD3 tools, this 2+1 format are gonna help us avoid that too. The hope is that by using the immune system in the right way, you can have a less toxic therapy with a lot of avoiding the long-term toxicities that you get from chemo, which is ultimately what's dangling on an ADC. Gotcha. I've gotta ask about your CD28 franchise, and it's immensely interesting. Kind of for you, what's the real interest for using that as a bispecific to engage T- cells if that signals-? That's about turning on cold tumors, right? Which has been the holy grail for immunotherapy since the first PD-1 data came out about a decade ago, a little more than a decade ago. There's certain tumors that respond really well to checkpoint inhibitor therapy because the immune system is primed to kill those tumors, and you just have to release a break, and there's others that nothing happens. Prostate cancer, triple-negative breast cancer, gosh, many of the gynecologic tumors, right? More tumors than not, pancreatic, colorectal, don't respond to checkpoint therapy. How can you turn those on? Because the immune system is always in your body and it's present. CD28 is a way to try to do that, and a potential way to do that broadly. The challenge of targeting CD28 on T- cells is like, you know, in the old days when you just hit it with an antibody, it was like lighting a fire, right? You can't control it. Bispecifics allow you to engineer a molecule that engages CD28 but only engages it productively when you've got that antibody decorating a tumor cell, providing a lot of anchor points for the T- cell CD28 to see. You can do that with bispecifics, designing the right affinities, the right valencies. That's the promise, is how can you turn on cold tumors generally, but in that tumor-specific way. With recent data from Regeneron with their PSMA CD28 showing that in a pretty notoriously cold tumor, prostate cancer, it seems like from early data you can turn it on. That was a really important validation of the approach. We're in the clinic with our B7-H3 CD28, which we think is a terrific target for CD28, expressed on numerous different tumors, really pretty clean in its expression. It's only on a handful of healthy tissues and at a much lower level than on its typical tumor expression. We wanted to have a sort of Swiss Army knife of CD28 to apply for our first molecule to a bunch of different tumor types. That's in dose escalation right now. We are building numerous others now that we've seen this initial validation. There's a great opportunity to try to take this initial leadership position we haven't really cemented, and we're making a lot of different molecules and targeting cold tumors to see if we can flip that switch. Gotcha. I guess when can we see the initial data there? Really exciting program. Yeah. I don't think we're gonna see data this year. We just started our phase I study last quarter. You have to start pretty low with these immunotherapy agents, so I wouldn't say our phase I design is overly onerous. The FDA's understanding these immunotherapies better. It is in combination with Pembro. I would say that in 2024 we should hopefully have data. We're looking at a variety of cold tumors in our phase I, and the design is such that we hope we can go fast and see that effect in combination with a checkpoint inhibitor. We dose for one month. Every patient gets this. At your given dose level in your given cohort, you get XmAb808 or our CD28 bispecific at that dose for one month, two doses. At the end of that month, if you have passed that safety window, they add Pembro on top of the additional CD28 doses. You can sort of get your monotherapy dose escalation as well as your combo therapy dose escalation done with the same set of patients in one cohort. That should hopefully move us along much faster. Gotcha. It's such an interesting program 'cause you got B7-H3. That would kinda give you a really clear shot, right? Of like taking something through to development. Right. -through to commercialization. Very little competition in a sense. Yes. Very broad. I would say both our XmAb819 ENPP3 program in renal cell as well as XmAb808, the molecules were designed to get us into indications and settings where if they show promising activity, you could design a program that a small company could take all the way. We wanna have those kinds of programs that we can grow our company around. Maybe as an easier and more simply, clearly defined development path than you have with, say, a cytokine in combination in, with different oncology therapies. That was conscious decision. We are really excited. It is early days, but, you know, we've maintained a strong balance sheet at Xencor so we can dig into these early programs and keep reinvesting in that early phase, so we can try to stay at that bleeding edge. Gotcha. I'll pivot back to the pipeline, but I definitely have to ask you a question around Silicon Valley Bank kind of exposure. Mm-hmm. Not only to Silicon Valley, but I guess, regional banks. Oh. non-bank lenders, if there's anything you had already thought. We maintain our cash accounts, which, you know, are all triple A-rated government paper, at JP Morgan. We didn't have any exposure to Silicon Valley Bank. Gotcha. Okay. And I, I- Continue. I think what the Fed did was great for the sector and great for the entire U.S. economy to stabilize things. Crazy last weekend, I'm quite hopeful it's been in the rear view mirror now for the whole sector. Yeah. Just back to your B7-H3 CD8, CD28, sorry. Kind of what's the bar for success, and is prostate the most obvious first? I think for initial proof of concept, any one of the cold tumors is a way to use bar for success, where by targeting those, really any response is more than one hits the bar, right? That's what the point of using cold tumors is. Pembro alone, you have a lot of documented evidence, and in places like prostate cancer, triple-negative breast, there's not a lot of activity. Those are the ones you need to focus on to get your look at activity. I think for a continued development, prostate cancer is a very exciting area. We could honestly consider combining it with Vudalimab as we advance and have our XmAb808 dose, right? An all internal immunotherapy regimen. We can also imagine combining it in RCC, where B7-H3 is expressed with XmAb819, because CD28s can productively combine with CD3 bispecifics to boost that Signal One CD3 signal with the Signal Two of CD28, but in a way that lets you have that T-cell activation be more specific to the tumor, and your CD3 is getting a boost without maybe having too much CD3 dose and causing some of that CRS. You can maybe have a safer CD3. There's a lot of ways to productively combine it, and I think it's way too early to pick a development path. Let's get the data in a few cold tumors and see where we stand. Gotcha. Do you think we'd get to recommended phase 2 dose this year, or is it trying to work out which route to take? Yeah. I suspect, given how low in dose we've had to start, that this year would be pretty optimistic for an RP2D. Perfect. Thank you. I guess finally, just kind of thinking about the combination strategies as well. I mean, that's where things open up in a really interesting way. CD28s provide that Signal Two T-cell boost, releasing the brake and giving you that longer term activation, maintenance of activation. Therefore, they productively combine with checkpoint inhibitors, which release the brake on an ongoing Signal One, a T-cell receptor-driven Signal One, where you're recognizing some neoantigen. They combine beautifully with CD3s, and there's all this preclinical data that we and others have shown this. CD3 is directly engaged with T-cell receptors through the CD3 subunit and turn on the T-cell. We look at the different agents that we have just in our own, our own repertoire. Vudalimab, a PD-1/ CTLA-4 is a really interesting combination with a CD28. You sort of get a double whammy on Signal Two because CD28 fights to turn on a Signal Two, CTLA-4 fights to turn it off, right? You could get that double whammy, and it would be a wholly owned Xencor combo. Like I mentioned, our XmAb819 program. There's other CD3s out there that we've certainly, you know, got our eye on and we've discussed, you know, as we go forward, potentially collaborating with other companies. There's a suite of them. Each, I would imagine each tumor type is gonna have its best combination agent, mostly based on what the leading agents are and then somewhat on the biology. Gotcha. I guess finally, with like a minute left on the time, just business development strategies. Are you accelerating that, decelerating? How should we think about it? As a company, we're focused on our internal pipeline and think about business development as a way to advance a program that we simply look at our own resources and time frames and think a partner could greatly help the value of it. A great case of that is our Plamotamab program, our CD20/CD3 program in lymphoma. We partnered that with Janssen a little over a year ago. Saw really promising phase I data, a competitive landscape intensity that was very high and an indication that I would call, you know, medium-sized lymphoma, not vast size like frontline lung cancer. We think of partnerships as ways to supplement our own internal development or sometimes just license out something we're not gonna do. Given the high interest in CD28, we are considering the idea of partnering to expand the early pipeline moving forward. We certainly wanna control the bulk of it, but I could see entertaining ideas there. Perfect. Thank you. With that, thank you so much, Bassil. Thank you, Peter. Pleasure.