Welcome back, everyone, to the 2024 RBC Global Healthcare Conference. My name is Greg Renza, one of the Biotechnology Equity Research Analysts here at RBC, and we're pleased to have Xencor with us today. Joining us from the company is the Senior Vice President of Corporate Strategy, Dane Leone. Dane, it's great to see you. Thanks for joining us. Great to see you, Greg, and thank you to yourself and the RBC team for hosting us at your conference. Very excited to be here and look forward to having a discussion. Yeah, I know there's certainly a lot to cover. Maybe one place to start is, I think, maybe you're more accustomed to being on this side of the table, so to speak. I think it might be helpful to hear about your transition, your entrance to Xencor, and joining the management team, maybe hearing that in your voice before we get into sort of the company and what you're working on. Yeah, great. No, definitely a fair question and definitely a little different to be in the hot seat versus the one asking the question. So I appreciate you taking the chance on me. No, it's a good question. So I joined the company at the beginning of the year, 2nd January. And as you know and probably some others on the webcast know, I joined from investment banking and biotech. So a bit change of objective for me, for sure, going from the outside to the inside now. When I made the decision to join Xencor, it was multifactorial. So one, obviously, I've always loved the biotech industry and drug development, and the chance to work with a great team on a great platform with a proven track record of developing drugs from scientific concept through clinical development was a great opportunity. But really, when I think about why now, not a year ago, two years ago, or into the future, it really came down to having conviction that we're at a nexus of the technology with bispecific antibodies and being able to be a part of thinking about how that technology can be applied across oncology, other serious diseases, and really, hopefully, affect clinical advancements for the patients and the clinical community. So that's what we're really focused on, transitioning this year into what will be a tier one clinical development organization. And it takes a lot of work, as I'm finding out. Yeah, absolutely. And Xencor is traditionally all about clinical execution, as you've noticed. And there's just a vast array of programs going on, certainly maybe starting with the XMAB portfolio. Maybe just walk us through how you're viewing that. There's several programs. Maybe just break those down for us as far as the prioritization areas of focus for 2024. Yeah, no, great question. So we do have a number of programs. Going into the year, we had more programs, and we refocused the priority of the portfolio to really be core to where we think we have a differentiated approach to clinical development and what we can do for those specific tumor types, since we're focused at the moment on oncology. As we've thought about the portfolio and what we hope to deliver to the clinical portfolio, clinical community, and also investors over the next 12-18 months, we would generally put the T-cell engager platform as kind of front and center with XmAb819, which is our ENPP3 x CD3, as the lead program from that group, followed by XmAb808, which is our B7-H3 x CD28 bispecific. And new to clinic is the Claudin -6 x CD3 just this year. So our hope is to take some learnings from those programs and apply it to the dose escalation pace that we can deliver on XmAb541, which is the Claudin-6. Not to forget about vudalimab, which is our PD-1 CTLA-4. So a little bit different concept and from an earlier era of Xencor development. But we're moving along there in both the monotherapy prostate cancer cohort and in combination with docetaxel. So on our fourth quarter call, we promised to the street that we would hopefully get to target enrollment of both those cohorts of about 30 patients by year-end and hopefully have some decision points that we can make heading into next year on where that program sits. A little bit earlier, but we are running a frontline non-small cell lung study there, which is still in part A, and that will be probably enrolling into next year as well. Okay, all right, great. So maybe let's go in order here with 819 ENPP3. Just update us on the clear cell renal cell carcinoma program and what the latest is there. Yeah, so ENPP3 CD3, we think, is a great tumor-associated antigen target for a T-cell engager. The protein expression level is great, and renal cell should not require preselection of patients. Could it be broader than that? Yes, there's ENPP3 expression, and other tumor types, lung would be one of those. Could require preselection, we don't know yet. But the dose escalation has been very focused on clear cell renal cell carcinoma. No change to guidance, so we're hoping to get to the target dose levels by year-end. We're happy with how the dose escalation is going. Still very excited about how the program could shape up. And renal cell is kind of an open book at the moment, so there's not really a clear standard of care across different lines of therapy. We've seen some recent drug approvals in the later line, and that's not been a huge advancement over standard of care or what's usually used as in the control, which is Everolimus. So I think we have a really rational drug that we're excited to see get to those higher dose levels and then make some decision points. It's going to be a competitive space, but we're way ahead of the competition, and we'll keep on pushing forward. With some of that initial data that could be forthcoming, what clinical significance should we frame up from such findings from a phase I and as it relates to the treatment landscape that you're alluding to? Yeah, no, great question. So the late-line renal cell landscape does not have a lot of great treatment options. Like I mentioned, everolimus is a single-digit response rate and kind of mid-single-digit PFS. The general expectation for a novel agent to be exciting in that space, and this isn't per us, this is per our investigators, would be probably around a 20%-30% response rate. You'd be looking for a hurdle as a monotherapy and hopefully with some decent durability on MDOR that would translate into a better PFS. And the T-cell engager mechanism is getting a lot of validation, right? So Xaluritamib, which does use our 2+1 format, it is an Amgen program that we licensed out years back, really had a nice response rate, 40% response rate in late-line prostate, as we saw at ESMO late last year. And that was heartening to us to see what can be done when you get to those target dose levels for a T-cell engager in solid tumors. And that's really, I think, what the field has been waiting for since the successes we've seen with T-cell engagers in heme malignancy. So we're really excited to keep on pushing forward here and look forward to eventually sharing some exciting results with you in the clinical community. You mentioned sort of the landscape and perhaps you being ahead. I think J&J may have their own ENPP3 program, I think, showcased at AACR. Just curious if you've seen that preclinical data and any thoughts on putting that into context. Yeah, no, great question. Admittedly, I have seen the poster. It's out there. I think part of my job, probably. There was not a lot to discern from the disclosures of that poster, but I think a couple of points that we thought were interesting was the highlight of the protein expression in other tumor types out of renal. That's concordant with our view. I think probably goes back to a question that a lot of investors have asked us about the 819 program is how expansive can it be? So really, that's the goal of pushing as hard as we can to find the right dose levels and dose optimization in renal cell and then start thinking about how we can broaden out the program from there. In terms of design format, we've obviously disclosed we use our 2+1 format, which is the same format that's used with Xaluritamib. I think we went with that design for some fairly specific reasons around targeting ENPP3. We know ENPP3 as a target works well. There were prior studies of now failed ADCs that targeted ENPP3, had clinical response, but also had toxicity associated with warhead. And so we know it's a good target, and seeing someone like J&J validate that is great. I think the question is, once we know more about their bispecific format, did they choose the right format to go with? And like I said, there were some fairly specific design and engineering tactics that we used that it's not apparent from their poster they went in the same direction. Yeah, great. Let's turn to 808 then, B7-H3. Just curious of the status of this dose escalation. When are we going to get that more substantial update? But how is Xencor tackling with CD28 those traditional toxicity risks that we've seen across trials? Yeah, no, CD28 is a long-storied development endeavor, right? Going back to the original data of a super agonist approach that, unfortunately, did not prove safe. And then for over a decade, two decades later, a next generation approach from us and some of our peers. What can we learn from these newer programs? I think within the public realm now, yeah, you get activity, right? You can get activity. So now the question is, can you separate clinical activity from clinical toxicity and create a therapeutic index that makes this mechanism useful? We chose B7-H3 to be almost a Swiss Army knife of a tumor-associated antigen. It's expressed across a lot of tumor types. I think there's probably a slight misconception of our dose escalation. A lot of people have associated us with prostate only. We actually have a basket of different tumor types in this dose escalation and hope to get to those target doses by year-end, or we can do an evaluation point and figure out how to broaden out the program. Similar to our peers, we do use a design with Pembrolizumab as a combination agent after a run-in period of 808 monotherapy. That's helpful to kind of understand what exactly is going on from each component. That's where I think a lot of the focus on prostate has been, because obviously, if we see a signal in a subset of prostate cancer patients, that's kind of indicative, given that Pembrolizumab doesn't really work there. So it's an exciting space broadly. I think, to be fair, we've characterized that space as earlier than the T-cell engager CD3 space, but with a lot of potential. The debate that a lot of people are having and asking us about is, do you go with a PD-1? Do you go with a CD3 in combination? I think off the cuff, we'll see differences in what the right fit is, depending on the tumor type, depending on the tumor-associated antigen. Obviously, our peers are seemingly having success in one area and saying there wasn't success in another area in combination with a PD-1. That's probably situational and specific, but very exciting that we're going to continue to generate more data for the field in this area. Right now, it's kind of Xencor and a couple of large peers at the forefront. We're pushing along and keeping pace with our large peers and hopefully can keep expanding these programs as we continue. You've been there before in that respect. Let's turn to 541 and Claudin-6. Patient enrollment is ongoing. What levels of Claudin-6 expression do you think are required for therapeutic efficacy here? Yeah, so there's two concepts of whether a patient is technically Claudin-6 positive or what level of positivity is relevant. I would say at the moment, the level of positivity that's relevant is a little unclear. But positivity in something like ovarian is going to be odds on the patient that you're going to enroll. So preselection in ovarian is maybe when you get to optimization of the patient pool that you really are taking in on, could be something to be explored, but right now is a little less necessary. Outside of ovarian, I think the field generally agrees you're going to want to use some preselection. But generally, as a target, I mean, I would feel comfortable saying Claudin-6 could definitely be equivalent, if not better, than folate receptor alpha. Okay, all right. And certainly just reminded of Xencor as oncology, but also autoimmune potential as well. Just in thinking about 564, for example, what are the critical data points required to determine whether or not to advance or halt an asset like this in autoimmune diseases? And certainly appreciating Xencor's history of really moving fast and also failing fast, which actually is a rather prudent approach for development. Yeah, one side of that is obviously being diligent with capital. And the other side hopefully creates high-class problems. So yeah, with what we've said about our IL-2 and IL-12 programs, the cytokine programs that we still have in clinic, we're hoping to wrap up the phase 1 data packages of both those programs in the first half of this year. And being transparent about it, these would be programs that I think would be open to other ideas from third parties around their continued development. Both are pretty exciting in terms of how we designed the molecules. I think as we reprioritized our portfolio, realized at least our internal view of what would take to develop those molecules wasn't high up enough on the list. And so we'll have full data packages there in the first half of this year, and we'll see what happens with them. But right now, that's not something we're going to take for ourselves. Makes sense. Let's talk vudalimab. Sure. Recent data disclosed on prostate. How are you viewing this efficacy and safety in relation to other emerging therapies? Yeah, great question. It's a field that continues to have volatility and shift rapidly, as we saw last week. In terms of our view on vudalimab, it really hasn't shifted much. If you're thinking about a late-line prostate cancer patient population, especially those that we require right now for the monotherapy cohort to have measurable disease at baseline, these patients are really sick. I mean, they're at the end of the line. There's no other available options. And generally speaking, within that patient population, if you have an IO agent that's delivering 25%-30% response rate defined as RECIST, hopefully, in conjunction with or something deep like a PSA 90, that's something, right? That's more than what you're going to get with re-challenge of chemo, certainly better than what you would get with an AR switch. And that's helpful. I think the question for the PD-1 CD3 for bispecific class broadly with ours and our peers is, how does the toxicity stack up in relation to the efficacy? We feel reasonably confident the dose levels we're using in the monotherapy and the combination cohort are good in the tolerability aspect to allow us to maintain adequate drug coverage, to have the clinical effect that we're looking for. But that's why we've also set very stringent criteria on what we need to see from the clinic towards the end of our enrollment into these "expansion cohorts" for both monotherapy in combination with Docetaxel to say, okay, this is clearly something we need to develop. And those hurdles were defined in part for us by our investigators. We had an investigator meeting at ASCO GU this year, and that was very helpful. That's kind of where we were pushed to get close to an n of 30 in the monotherapy and the combination cohorts to really do some sort of analysis with a reasonable confidence interval that we're on the right path there. Then also on the non-small cell landscape, how competitive can vudalimab be here? How can it differentiate itself among these IO doublets and the IO ADC combos? Yeah, great question. So we've started a frontline lung cancer study of vudalimab plus chemo. And we're in part A enrollment of that study. Part A, we would hope to kind of either confirm or deny what some of our peers have seen in their early cohorts that supported that moving into the larger non-small cell lung cancer cohorts. I think the honest answer here is there's a good biological rationale of why targeting double-positive cells, PD-1 and CTLA-4-positive T cells, can have a better effect than what you could ever get with different combinations or dosing algorithms of Ipi/Nivo. Having that play out into survival curves, that's obviously a question that the field needs to answer. But we view that study as a rational study to run and have in process and have put in the cut points, especially with part A of the study, to have an evaluation of, A, tolerability with chemo, which will probably be necessary. And then two, is the efficacy looking differentiated enough with what you would expect with pembrochemo to warrant a larger study? Okay. And then as far as additional indications potentially for vudalimab, such as cervical, head and neck, how sensible is it to follow some cues from the competition and expand beyond? Yeah, great question. I think that's kind of the plan, right? We have a peer that has put out many trials of their drug to explore how they could develop around the current PD1 class and the approvals of that PD1 class across many different tumor types and indications. If those cards flip and they're positive, that becomes validating to the space. And obviously, they have capital to do kind of this broader approach. And that becomes very interesting, right? And then we would make the decision points of what we could prosecute as an organization or what would make more sense in partnership with someone else. So, complex algorithm that we need to run, but hopefully having the lung study in tandem with the prostate cohorts we're running will keep us in the game. Okay. Maybe last question, just to put a bow around it, maybe Dane, just kind of summarize for us the areas of focus that we should be looking towards when it comes to the most important points and developments, the catalyst for Xencor over 2024. Yeah. So we really oriented this year around clinical execution and going back to where we started the conversation on emerging as a credible clinical development organization. So this year, I think in priority is really making sure we get to those target dose levels of 819, 808, where we have information on the next steps of those programs, staying ahead of our competition, and then getting towards those evaluation points with vudalimab that we can then share externally at some point in the future and let people know the critical path forward for that program. Claudin-6, our hope there, we haven't really set a defined target. But again, like I said earlier, using some of the learnings of what we've had to push that program forward is really the goal. All right. Any questions from the audience before we break? Just on the ENPP3 bispecifics, or maybe even the CD28 bispecifics, do you anticipate the data from the dose escalation in just ranging portion to kind of be in the relevant ballpark for people to kind of gauge on its clinical potential? Or do you anticipate the data would be more meaningful to look at the more optimal doses that you are planning to expand into the nearest cohorts? Yeah, good question. So I think when we gave the guidance of getting to target doses, that doesn't imply dose optimization as well to a large degree. So I think when we get to those target dose levels, they'll start to put the puzzle pieces together on what the clinical profile is. And that then kind of unlocks the decision-making of dose expansion. What does dose expansion cohorts look like? Do you broaden out the program to other indications as well? And how aggressive do you get with the program? So I think they will be informative of when we get there. Great. Well, Dane, great to see you. Thanks for joining us. Yeah, thank you for having us. This has been great. All right. Thanks, everybody.