Recombinant human anti-LAG-3 monoclonal antibody(Guangzhou Yuheng Biotechnology/Wuxi Biologics (Cayman))

Conference Call with Slides Begins at 4:30 p.m. Eastern Time Today EMERYVILLE, Calif.--(BUSINESS WIRE)-- OmniAb, Inc. (NASDAQ: OABI) today reported financial results for the three and six months ended June 30, 2023, and provided operating and partner program updates. “Our business continued to grow and perform well during the second quarter with advancements in business development and progress across partner programs. The addition of four new partners during the quarter, including Merck & Co. and Neurocrine Biosciences, highlights the relevance and robustness of our technology platform. Existing partners made progress with two new programs entering the clinic and the total number of active programs increased to 305,” said Matt Foehr, Chief Executive Officer of OmniAb, Inc. “Our ion channel business continues to identify and explore high-value targets and one of the GSK programs achieved a key milestone in its discovery process. We look forward to providing updates related to our current partners as well as to securing additional partnerships,” he added. Second Quarter 2023 Financial Results Revenue for the second quarter of 2023 was $6.9 million, compared with $7.2 million for the same period in 2022. Milestone revenue was higher due to progress with the batoclimab program. Service revenue was lower primarily related to the completion of work on certain ion channel programs and a one-time adjustment related to the extension of one of our programs with GSK, partially offset by the recognition of a portion of a research progression milestone achieved in the quarter. Research and development expense was $14.1 million for the second quarter of 2023, compared with $11.5 million for the same period in 2022, with the increase primarily due to higher personnel and facility costs. General and administrative expense was $8.7 million for the second quarter of 2023, compared with $5.0 million for the same period in 2022, with the increase primarily due to higher personnel costs and expenses related to being an independent publicly traded company. Net loss for the second quarter of 2023 was $14.7 million, or $0.15 per share, compared with a net loss of $10.3 million, or $0.12 per share, for the same period in 2022. Year-to-Date Financial Results Revenue for the six months ended June 30, 2023 was $23.9 million, compared with $16.8 million for the same period in 2022. Milestone revenue was higher, primarily due to the recognition of a $10.0 million milestone payment related to the first commercial sale of TECVAYLI® (teclistamab) in the European Union and progress with the batoclimab program. Service revenue was lower primarily related to the completion of work on certain ion channel programs and a one-time adjustment related to the extension of one of our programs with GSK, partially offset by the recognition of a portion of a research progression milestone achieved in the quarter. Research and development expense was $27.9 million for the six months ended June 30, 2023, compared with $22.3 million for the same period in 2022, with the increase primarily due to higher personnel and facility costs. General and administrative expense was $16.9 million for the six months ended June 30, 2023, compared with $9.1 million for the same period in 2022, with the increase primarily due to higher personnel costs and expenses related to being an independent publicly traded company. Net loss for the six months ended June 30, 2023 was $20.8 million, or $0.21 per share, compared with a net loss of $16.6 million, or $0.20 per share, for the same period in 2022. As of June 30, 2023, OmniAb had cash, cash equivalents and short-term investments of $103.1 million. The Company continues to expect its cash, cash equivalents and short-term investments balance at year-end 2023 to be slightly higher than year-end 2022. Current cash, cash equivalents and short-term investments, along with the cash OmniAb generates from operations, are expected to be sufficient to fund operations for the foreseeable future. On November 1, 2022, OmniAb completed a spin-off from Ligand Pharmaceuticals Incorporated (NASDAQ: LGND), resulting in OmniAb becoming an independent publicly traded company. Financial results prior to November 1, 2022, are presented on a carve-out basis derived from Ligand’s historical accounting records, as if OmniAb were an independent company. Second Quarter 2023 and Recent Business Highlights During the second quarter of 2023, OmniAb entered into four new license agreements including with Merck & Co., Inc., Neurocrine Biosciences Inc., Stanford University and Seattle Children’s Hospital. These additions bring the total active partner count to 74. Programs by OmniAb’s partners continued to progress during the quarter, including two entering the clinic. Immunovant’s IMVT-1402, a next-generation FcRn antagonist, and Gloria’s GLS-012 (anti-LAG-3), initiated Phase 1 clinical trials in China. In addition, the Biologics License Application for batoclimab was accepted by the National Medical Products Administration of China (NMPA). Batoclimab continues to progress in clinical trials in other geographies. As of June 30, 2023, the Company’s partners had a total of 305 active programs. There are 29 active programs that have advanced into the clinical stage or later, including three approved drugs, one under regulatory review and 25 in various stages of clinical development. Second quarter 2023 and recent partner highlights include the following: Batoclimab OmniAb earned milestone revenue related to the advancement of batoclimab into pivotal studies in two additional indications: thyroid eye disease and chronic inflammatory demyelinating polyneuropathy. These indications are in addition to the ongoing Phase 3 study in generalized myasthenia gravis (gMG). Harbour BioMed announced the NMPA accepted the Biologics License Application of batoclimab for the treatment of gMG. HanAll Biopharma announced it is progressing toward initiation of a Phase 3 clinical study in Japan later this year with batoclimab in gMG. IMVT-1402 Immunovant announced it received Investigational New Drug clearance from the U.S. Food and Drug Administration (FDA) for IMVT-1402, a subcutaneously-administered FcRn inhibitor, and initiated a Phase 1 clinical trial in healthy volunteers. This trial will evaluate the safety, tolerability and pharmacodynamics of IMVT-1402. Initial data are expected later this year. GLS-012 Gloria Pharmaceuticals initiated a Phase 1/2 study in China to investigate the safety, tolerability and preliminary efficacy of GLS-012 (anti-LAG-3) monotherapy and in combination with GLS-010 in subjects with advanced solid tumors after progression on standard treatment. CSX-1004 Cessation Therapeutics announced that the FDA has authorized the company to initiate a clinical trial in the U.S. for CSX-1004, a monoclonal antibody designed specifically to prevent fentanyl overdose. Cessation announced plans to begin trials with the first cohort of subjects in August of 2023. APVO436 Aptevo Therapeutics announced that its bispecific acute myeloid leukemia (AML) drug candidate APVO436, in combination with emerging standard-of-care venetoclax and azacitidine, achieved positive duration of remission results in its Phase 1b dose-escalation trial. Aptevo intends to conduct two Phase 2 clinical trials to include relapsed/refractory AML patients beginning in the second half of 2023 and frontline patients beginning in the first half of 2024. GSK Program-1 (Ion Channels and Transporters) OmniAb achieved a research progression milestone for small molecule inhibitors of a genetically-validated target relevant to neurological diseases in collaboration with GSK. Upon this achievement, OmniAb was entitled to a progression milestone payment of $2.0 million. In May 2023, OmniAb highlighted some of its new technology at the 19th Annual PEGS Boston Conference and Expo, including a presentation on its OmniDeep™ platform. OmniDeep is a suite of in silico tools for therapeutic discovery and optimization that are woven throughout OmniAb’s various technologies and capabilities. OmniDeep facilitates rapid identification of candidates with the right affinity, specificity and developability profiles to make drug development more effective and efficient. Conference Call and Webcast OmniAb management will host a conference call with slides today beginning at 4:30 p.m. Eastern time to discuss this announcement and answer questions. To participate via telephone, please dial (888) 396-8049 using the conference ID 10758721. Slides, as well as the live and replay webcast of the call, are available at . About OmniAb® OmniAb’s discovery platform provides pharmaceutical industry partners access to diverse antibody repertoires and high-throughput screening technologies to enable discovery of next-generation therapeutics. At the heart of the OmniAb platform is the Biological Intelligence™ (BI) of our proprietary transgenic animals, including OmniRat®, OmniChicken® and OmniMouse® that have been genetically modified to generate antibodies with human sequences to facilitate development of human therapeutic candidates. OmniFlic® (transgenic rat) and OmniClic® (transgenic chicken) address industry needs for bispecific antibody applications though a common light chain approach, and OmniTaur™ features unique structural attributes of cow antibodies for complex targets. We believe the OmniAb animals comprise the most diverse host systems available in the industry and they are optimally leveraged through computational antigen design and immunization methods, paired with high-throughput single B cell phenotypic screening and mining of next-generation sequencing datasets with custom algorithms to identify fully human antibodies with superior performance and developability characteristics. These proprietary technologies are joined with and leverage OmniDeep™, which is a suite of in silico tools for therapeutic discovery and optimization that are woven throughout OmniAb’s various technologies and capabilities. Additionally, an established core competency focused on ion channels and transporters further differentiates OmniAb’s technology and creates opportunities in many emerging target classes. OmniAb antibodies have been leveraged across modalities, including bispecific antibodies, antibody-drug conjugates and others. The OmniAb suite of technologies span from BI-powered repertoire generation to cutting-edge antibody discovery and optimization offering a highly efficient and customizable end-to-end solution for the growing discovery needs of the global pharmaceutical industry. For more information, please visit . Forward-Looking Statements OmniAb cautions you that statements contained in this press release regarding matters that are not historical facts are forward-looking statements. Words such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or continue” and similar expressions, are intended to identify forward-looking statements. The forward-looking statements are based on our current beliefs and expectations and include, but are not limited to: the growth prospects of our business and the discovery needs of the pharmaceutical industry; the expected performance of, our technologies and the opportunities they may create; the ability to add new partners and programs; scientific presentations and clinical and regulatory events of our partners and the timing thereof; expected cash runway; and the future balance of cash, cash equivalents and short-term investments. Actual results may differ from those set forth in this press release due to the risks and uncertainties inherent in our business, including, without limitation: our future success is dependent on acceptance of our technology platform by new and existing partners, as well as on the eventual development, approval and commercialization of products developed by our partners for which we have no control over the development plan, regulatory strategy or commercialization efforts; biopharmaceutical development is inherently uncertain; risks arising from changes in technology; the competitive environment in the life sciences and biotechnology platform market; our failure to maintain, protect and defend our intellectual property rights; difficulties with performance of third parties we will rely on for our business; regulatory developments in the United States and foreign countries; unstable market and economic conditions, including adverse developments with respect to financial institutions and associated liquidity risk, may have serious adverse consequences on our business, financial condition and stock price; we may use our capital resources sooner than we expect; and other risks described in our prior press releases and filings with the SEC, including under the heading “Risk Factors” in the our annual report on Form 10-K and any subsequent filings with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and we undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Partner Information The information in this press release regarding partnered products and programs comes from information publicly released by our partners. [Tables Follow] OMNIAB, INC. CONDENSED CONSOLIDATED AND COMBINED BALANCE SHEETS (in thousands, except share and per share data) June 30, 2023 (Unaudited) December 31, 2022 ASSETS Current assets: Cash and cash equivalents $ 20,988 $ 33,390 Short-term investments 82,161 54,875 Accounts receivable, net 8,611 30,290 Prepaid expenses and other current assets 4,180 6,395 Total current assets 115,940 124,950 Intangible assets, net 161,921 167,242 Goodwill 83,979 83,979 Property and equipment, net 19,226 19,979 Operating lease right-of-use assets 20,827 21,483 Other long-term assets 3,346 3,579 Total assets $ 405,239 $ 421,212 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 2,359 $ 2,971 Accrued expenses and other current liabilities 4,929 5,557 Income tax payable 3,455 3,485 Current contingent liabilities 2,810 4,022 Current deferred revenue 7,271 8,207 Current operating lease liabilities 3,417 1,780 Total current liabilities 24,241 26,022 Long-term contingent liabilities 3,384 4,089 Deferred income taxes, net 17,189 21,341 Long-term operating lease liabilities 23,100 24,016 Long-term deferred revenue 3,479 4,325 Other long-term liabilities 40 46 Total liabilities 71,433 79,839 Stockholders' equity: Preferred stock, $0.0001 par value; 100,000,000 shares authorized at June 30, 2023 and December 31, 2022; no shares issued and outstanding at June 30, 2023 and December 31, 2022 — — Common stock, $0.0001 par value; 1,000,000,000 shares authorized at June 30, 2023 and December 31, 2022; 115,584,520 and 115,218,229 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively 12 12 Additional paid-in capital 343,419 330,100 Accumulated other comprehensive income (49 ) 9 (Accumulated deficit) Retained earnings (9,576 ) 11,252 Total stockholders’ equity 333,806 341,373 Total liabilities and stockholders’ equity $ 405,239 $ 421,212 OMNIAB, INC. CONDENSED CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except per share data) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Revenues: License and milestone revenue $ 4,330 $ 2,325 $ 16,976 $ 6,426 Service revenue 2,451 4,735 6,409 9,994 Royalty revenue 165 139 480 402 Total revenues 6,946 7,199 23,865 16,822 Operating expenses: Research and development 14,133 11,484 27,892 22,256 General and administrative 8,738 5,003 16,933 9,115 Amortization of intangibles 3,380 3,113 6,749 6,518 Other operating expense (income), net 140 165 189 (278 ) Total operating expenses 26,391 19,765 51,763 37,611 Loss from operations (19,445 ) (12,566 ) (27,898 ) (20,789 ) Other income: Interest income 1,285 — 2,609 — Other expense (4 ) — (4 ) — Total other income, net 1,281 — 2,605 — Loss before income taxes (18,164 ) (12,566 ) (25,293 ) (20,789 ) Income tax benefit 3,436 2,290 4,465 4,231 Net loss $ (14,728 ) $ (10,276 ) $ (20,828 ) $ (16,558 ) Net loss per share, basic and diluted $ (0.15 ) $ (0.12 ) $ (0.21 ) $ (0.20 ) Weighted-average shares outstanding, basic and diluted 99,493 82,612 99,326 82,612

Even among hard-to-treat solid tumors, pancreatic cancer is in a league of its own when it comes to survival mechanisms. Criminal profiling can be the key to catching a killer. The same could be said for immune system profiling, which appears to have helped scientists crack the code on one of oncology’s most notorious villains: pancreatic cancer. In a study published Dec. 30 in Nature Cancer, scientists at the University of Texas MD Anderson Cancer Center described how they systematically went about profiling the way pancreatic tumors keep a patient’s immune system from fighting their cancer. The researchers’ sleuthing led them to three proteins, which they then targeted in mouse models with a trio of immunotherapies. Their results showed an overall survival rate of up to 90% through the end of the year-and-a-half-long study—more than half the mice’s life span. The same cancer in people has a five-year survival rate of 11%.   “As a human immunologist who has been involved in a lot of clinical trials, you’d be surprised that I was surprised that it worked so well, but I really was,” John Connolly, Ph.D., who is not involved in the research but is chief scientific officer at the San Francisco-based Parker Institute for Cancer Immunotherapy, told Fierce Biotech Research. Suppressing immune suppression   Even among hard-to-treat solid tumors, pancreatic cancer is in a league of its own when it comes to survival mechanisms. Under normal conditions, the immune system regulates itself with checkpoints, suppression pathways that hold down the “off” switch on T cells that would otherwise attack a person’s own tissue. Pancreatic cancer is especially good at exploiting these pathways by keeping the suppression mechanisms turned on, ultimately “exhausting” the T cells in the area surrounding the tumors, also known as the tumor immune microenvironment. T-cell exhaustion is just what it sounds like: The cells no longer respond to foreign invaders, allowing cancer cells to proliferate undetected. Pancreatic tumors’ unparalleled ability to suppress T cells makes them highly resistant to immunotherapies. That includes checkpoint-inhibiting drugs like Merck’s PD-1 inhibitor Keytruda and Bristol Myers Squibb's Yervoy, a CTLA-4 inhibitor, on their own or in combination. “Over the last 20 years, the field has tried many, many different agents to enhance the therapeutic strategies for this disease,” Ronald DePinho, M.D., senior author of the study, said. The statistically significant survival benefits seen in both mice studies and human trials thus far aren’t enough to make a meaningful difference in the clinic, he added.   But perhaps it was a matter of hunting down and neutralizing the right combination of the right checkpoints, DePinho’s lab reasoned. That would require a clear profile of how pancreatic cancer was impacting the immune system—in other words, its immune “fingerprint,” as Connolly described it. To find that fingerprint, Pat Gulhati, M.D., Ph.D.—a postdoc in DePinho’s lab—set about cataloguing all the immune checkpoint proteins that were expressed in exhausted T cells found in the tumor immune microenvironment of mice with pancreatic cancer. The researchers also took stock of the ones in both treated and untreated samples from  patients to make sure their findings were clinically relevant, with particular attention to the ones that showed up in highly resistant disease. In both samples, the researchers found that in addition to PD-1 and CTLA-4, the checkpoint proteins TIM3, 41BB and LAG were also expressed. They then enlisted their mouse models in multiarm studies with antibodies designed to target these proteins along with others they found in their search. Similar to what had been seen in humans, neither PD-1, TIM3 or CTLA-4 inhibition improved survival. But anti-LAG3 and agonistic 41BB antibodies individually extended the mice’s survival time by about 20% to 30% compared to controls. “And—as expected because mechanistically they worked quite differently—the combination of the two had additive effects,” DePinho explained. The dual therapy more than doubled their survival time. Third drug's the charm   But despite living twice as long as untreated models, the two drugs weren’t enough to keep the mice from succumbing to the disease. The researchers wondered whether they could improve the numbers with a third agent. For that, they turned to CXCR2, a protein that recruits myeloid-derived suppressor cells, or MDSCs, to the tumor immune microenvironment. Summoning MDSCs is another nifty trick up cancer’s sleeve. While normal myeloid cells—which include neutrophils and monocytes—act against foreign invaders, MDSCs have suppressive activity. Cancerous tumors activate them so they turn off T cells. And because they aren’t susceptible to immune checkpoint inhibitors, they’re a common route of treatment resistance. Like the two-drug combo, treating the mice with a CXCR2 inhibitor called SX-682 once again boosted their survival time by about 30% to 40%. Encouraged, the researchers then tried the three agents together. After 540 days, all but one of the 10 mice in a group with a highly virulent pancreatic cancer were still alive. Other groups with tumors grown from different cell lines had overall survival rates of around 70%. In models with multifocal, spontaneously arising tumor—a particularly aggressive form—the survival rate was 20%. None of the animals alive at the study’s end had any signs of cancer. “These were unprecedented cures seen in a very virulent mouse model of this disease,” DePinho said. Cell sequencing and immune profiling confirmed that drugs had indeed induced a potent immune response, overcoming suppression by the tumors. The study’s models were especially strong because the researchers made an effort to ensure that the immunosuppression patterns they saw in mice were the same as those in samples from human patients, Connolly said. “They created a nice resistance model that accurately reflected how resistance works in a human,” he explained. “Then they used advanced immunophenotyping and analytical techniques to really dive in and come up with a fingerprint of how resistance is working.” Speeding to the clinic   All three of the drugs used by the researchers are being studied separately in early-stage clinical trials. Bristol Myers Squibb’s LAG3 inhibitor relatlimab, which is already FDA approved as part of a combination treatment for metastatic melanoma, is one of the drugs being studied in the National Cancer Institute’s MATCH screening trial for solid tumors. Pfizer’s utomilumab, a 41BB agonistic antibody, showed a favorable safety profile in a phase 1 pancreatic cancer trial. And the CXCR2 inhibitor SX-682, developed by Syntrix, is in a phase 1 trial for pancreatic cancer with Bristol Myers Squibb’s Opdivo.     Combined with the results of their study, the work already being done with the agents warrants speeding along the process to trying them together in humans, DePinho said. “I think there’s as much preclinical proof-of-concept one could glean from looking at human specimens, which showed that the targets are there and that they correlate with clinical outcomes,” he said. “And the mouse model, which is a very faithful mouse model of the human disease, shows rather striking and encouraging results.” Connolly agreed. “There’s a lot of good mouse studies out there, but you really want to translate this to the clinic for it to be meaningful to patients,” Connolly said. “We really want to see that clinical trial get out there.” Combos galore Given that only 20 percent of the most aggressive tumors were cured with the triple combination, there’s also potential to try the combo with different agents that work against different suppression mechanisms. DePinho is particularly intrigued by the possibility of testing them with KRAS inhibitors, which have shown signals of efficacy both preclinically and in early stage clinical trials.   “With the advent of KRAS inhibitors, there is now going to be an opportunity to combine KRAS inhibitors with immune modulatory agents,” he said. “Based on our work, I would put at the top of the list anti-LAG3 and agonist 41BB or the CXCR2 inhibitor.” Connolly again agreed, noting that the concept makes sense for outsmarting drug resistance. “You want to try to add therapeutics that don’t share a mechanism of resistance,” he said. “The tumor may be able to escape the immune system, but it’s very difficult to escape the immune system and KRAS suppressors.” In general, the researchers’ approach is ideal for designing multidrug therapies, Connolly said. “Ron’s lab gives you a roadmap on how to make a combination therapy,” Connolly said. “Find the fingerprint of suppression, find the mechanism of resistance and attack that mechanism.”