CLDN4

Protein-making AI models have fueled the launch of a $1 billion startup and a Nobel Prize win in 2024, but are they ready to actually make drugs? Leaders of some of the largest startups working on that question say the technology is promising but not yet ready. But a tiny startup called Nabla Bio is far more bullish, posting a preprint Thursday highlighting its progress in creating antibodies from scratch that look therapeutically viable against some hard-to-drug targets in what it’s calling a first for the field. This isn’t the holy grail of having fully optimized drug candidates at the push of a button. But Nabla’s research is a step forward. The biotech’s leaders say their antibodies showed strong binding affinities and, in general, looked and behaved more like drug candidates than previous de novo efforts. Nabla said these are the first computer-generated antibodies against the family of proteins called GPCRs, which are notoriously hard to drug. The research includes eight examples of de novo antibodies against a range of targets, including proteins found in the membrane of cells like Claudin-4 and CXCR7. “The antibodies are developable, and they could potentially be real drugs,” said Frances Anastassacos, co-founder and president of Nabla. “They will have to go through lead optimization, but unlocking target space is a very exciting space to be. That’s the real promise of de novo design.” Other startups appear to be close behind, if not in lockstep, with Nabla, and that makes its first-ever claims hard to judge. For instance, a California startup called Abalone Bio told Endpoints News it has also generated de novo antibodies targeting GPCRs, the same hard-to-hit protein family cited in Nabla’s preprint. Abalone has not published those results, but presented some of its findings at an antibody engineering conference earlier this month and also framed them as a first for the field. “To our knowledge, these are the first designed GPCR antibody sequences that are functionally active,” its research poster stated. Protein design has arguably become the hottest space when applying AI to biology in 2024. David Baker, a pioneer in the field, won a share of the Nobel Prize in Chemistry last month. He also co-founded Xaira Therapeutics, which launched earlier this year with $1 billion to bring AI into drug R&D, specifically designing antibodies. A year ago, Flagship Pioneering’s Generate:Biomedicines published its own de novo model , called Chroma, and has raised nearly $750 million to build an extensive pipeline of antibody drugs. The leaders of those startups have also acknowledged the limitations of their recent work. Xaira CEO Marc Tessier-Lavigne recently told Endpoints News the AI models can generate initial hit candidates, but those still need to be improved by “old-school methods.” Generate R&D head Alexandra Snyder said earlier this year that designing from scratch isn’t yet ready for prime time, echoing what Baker has acknowledged in his own lab’s research. Despite having a fraction of the resources of Xaira or Generate, Nabla hopes to lead the field. It recently closed a $26 million Series A round and employs 16 people in its 4,500-square-foot lab in Cambridge, MA. CEO Surge Biswas, who co-founded Nabla in 2020 based on his PhD work in Harvard University geneticist George Church’s lab, said technology, rather than capital, is the key limit to progress. “Developing a system like we developed, the scarce commodity is not that you have $100 million to solve this problem,” Biswas said in an interview. “It’s not cheap, but you don’t need to raise giant amounts of capital to unlock some of these technologies.” In an interview, Church called Nabla’s preprint one of “relatively few actual success stories” in applying de novo work for so-called undruggable targets. “My hat is off to them for choosing targets well and not settling for a bunch of academic papers that settle five-decade-old challenges,” Church said. Nabla’s preprint details an AI system called JAM, or Joint Atomic Modeling, in which scientists provide the sequence and structure of a desired drug target. The system then generates antibodies that may fit that target. The most promising creations showed strong binding affinities and looked developable in lab testing, according to the preprint. There are still limitations to Nabla’s findings. They mainly made nanobodies rather than full-sized monoclonal antibodies that are commonplace in the drug industry. The paper included one example of a de novo monoclonal antibody, but that larger size also contributed to a lower binding success rate of 0.0017% for that project. Nabla doesn’t plan to advance these antibodies itself, as the company is focused on partnering with pharma, with ongoing deals with AstraZeneca, Bristol Myers Squibb and Takeda.

The floodgates for AI-enabled protein design burst open in 2024, with the Institute for Protein Design's David Baker claiming a Nobel Prize in chemistry for his foundational work, and DeepMind's unveiling of AlphaFold 3 to predict protein structures and interactions with  "unprecedented accuracy" (see – ViewPoints: Madrona's Chris Picardo on the AI-biotech convergence and ViewPoints: Expert expounds on potential for AlphaFold 3 to revolutionise research, democratise drug discovery).The year has also seen a slew of startups launch with aspirations to leverage computational technologies for drug design — and now Nabla Bio claims to have accomplished just that. The biotech, which emerged from stealth with a $26-million series A in May, pulled back the curtain on its Joint Atomic Modeling (JAM) platform on Friday. The technology, based on work out of George Church's laboratory at Harvard Medical School, can design lead-quality antibodies based on a target protein sequence or structure, the company said. Announcing the release of its technical paper detailing JAM's capabilities, the Nabla team noted that substantial progress has been made to predict protein structure and design proteins de novo — but noted that in regards to therapeutics, computational protein design tools have made relatively little progress to develop viable drugs. "Antibodies, as the most established drug format, are a great first real-world test for de novo drug design," Nabla said. "However, so far no AI systems have shown they are able to produce high quality lead antibodies from scratch in a way that is robust and generalises across protein targets and antibody formats."According to the company, JAM can design de novo proteins that closely resemble chimeric or humanised antibodies with good affinity, epitope-specificity and function — with no optimisation. With the technology, Nabla theorised that it's possible to replace traditional discovery methods with de novo design, thereby accelerating the development process while also cutting costs. Specificity against intractable targetsTo challenge its JAM platform, Nabla set out to design antibodies that can target several challenging or intractable classes of proteins, including multipass membrane proteins like GPCRs, tight junction proteins, disorder proteins and transiently stable complexes.The company successfully designed de novo, therapeutic-range antibodies against one undisclosed protein target and seven disclosed proteins: SARS-CoV-2 RDB, HER2, IL-13, PD-1, TrkA, CLDN4, CXCR7. Nabla said that its antibodies against the latter two targets, which are multipass membrane proteins, are the first computational designed binders of any kind to engage with CLDN4 and CXCR7.While the generated antibodies are more representative of lead molecules than fully optimised drugs, Nabla said they serve as "a robust starting point… to reach therapeutic-grade performance." The company highlighted that the AI-designed antibodies had high epitope-specificity, as they rarely bound another target. "This boost in specificity increases the likelihood of discovering functional leads and cuts down on wasted effort," Nabla said. Additionally, the firm said the antibodies had expression levels, monomericity and polyreactivity at or better than leading monoclonal products, suggesting they are well suited for manufacturing and formulation.

-- Royalty Transaction Generates $215 Million Upfront -- -- Management to Host Conference Call at 4:30 p.m. ET Today -- PASADENA, Calif.--(BUSINESS WIRE)-- Xencor Inc. (NASDAQ:XNCR), a clinical-stage biopharmaceutical company developing engineered antibodies and cytokines for the treatment of patients with cancer and autoimmune diseases, today reported financial results for the third quarter ended September 30, 2023 and provided a review of recent business and clinical highlights. “Today we are announcing measures to strengthen our balance sheet and maximize our focus on the most promising programs created with XmAb® technologies. First, we have sold a portion of our Ultomiris® and Monjuvi® royalties to OMERS Life Sciences for an upfront payment of $215 million. Importantly, we retain potential economic upside from the sales performance of these medicines,” said Bassil Dahiyat, Ph.D., president and chief executive officer at Xencor. “In addition, a core piece of Xencor’s strategy remains stringent decision making across our clinical pipeline based on emerging data from our programs, the evolving competitive landscape, and prudent management of our resources. We have decided to stop development of XmAb104, our PD-1 x ICOS bispecific antibody, narrow the enrollment for an ongoing study of vudalimab, and opt out of cost sharing with Genentech for our co-developed IL-15 program. Taken altogether, we believe our cash runway now extends into 2027. “These pipeline decisions highlight an enhanced focus on targeted T cell-engaging bispecifics, which hold great potential for the treatment of patients with solid tumors, as recently shown at the ESMO conference by our partner Amgen. Our ENPP3 x CD3 and B7-H3 x CD28 bispecifics lead our internal clinical pipeline for this modality, and we expect to add our CLDN6 x CD3 program in 2024.” Xencor Receives $215 Million Through Royalty Transaction with OMERS Life Sciences Xencor has sold portions of financial interests from Alexion Pharmaceuticals, Inc., on sales of Ultomiris® (ravulizumab-cwvz) and from MorphoSys AG on sales of Monjuvi® (U.S.)/Minjuvi® (ex-U.S.) (tafasitamab-cxix) to OMERS, one of Canada’s largest defined benefit pension plans. Under the agreements, Xencor has received a $215 million payment from OMERS. OMERS has acquired royalties due to Xencor on global Ultomiris sales from July 1, 2023 onward, with annual caps beginning in 2026, and the majority of a milestone payment earned this year. Xencor will also be eligible for a new Ultomiris sales-based milestone payment from OMERS. OMERS has also acquired royalties on global Monjuvi sales from July 1, 2023 until OMERS has received 1.3 times the value of the Monjuvi purchase price. Pipeline Updates Vudalimab (PD-1 x CTLA-4): As previously disclosed, Xencor anticipates initiating a Phase 1b/2 study to evaluate vudalimab, a T-cell selective checkpoint inhibitor, in combination with chemotherapy, as a first-line treatment in patients with advanced non-small cell lung cancer, by the end of 2023. Part 1 of the study will evaluate the safety and preliminary activity of two dose levels of vudalimab, enrolling up to 20 patients in each dose group, in order to recommend a dose level for Part 2 of the study. Xencor has been evaluating vudalimab in ongoing studies, as a monotherapy in patients with high-risk metastatic castration-resistant prostate cancer (mCRPC) and in gynecologic tumors, and in combination with chemotherapy or a PARP inhibitor in patients with mCRPC. Due to the rapidly changing competitive environment in these indications, the Company has closed the gynecologic tumor cohorts in the monotherapy study. Prostate cancer clinical data are anticipated to be presented at a medical conference in early 2024. XmAb104 (PD-1 x ICOS): Xencor will stop internal development of XmAb104 due to emerging data from Phase 1 expansion cohorts not meeting efficacy criteria for advancing the program. The study expansion enrolled patients with microsatellite stable colorectal cancer with or without liver metastases. The Company will continue to support patients currently enrolled and being treated. Efbalropendekin alfa (XmAb306, IL15/IL15Rα-Fc Cytokine): Xencor exercised its right under the Genentech agreement to convert its co-development and sharing of profits and losses on efbalropendekin alfa into a milestone and royalty arrangement without cost-sharing. The Company expects to finalize contract changes before year end. XmAb541 (CLDN6 x CD3): XmAb541 is a bispecific antibody that targets Claudin-6 (CLDN6), a tumor-associated antigen in ovarian cancer and other solid tumor types, and the CD3 receptor on T cells. The XmAb 2+1 multivalent format used in XmAb541 enables greater selectivity for CLDN6 over similar Claudin family members, such as CLDN9, CLDN3 and CLDN4. Xencor plans to submit an investigational new drug (IND) application by year end. Progress Across Partnerships Amgen Inc.: Encouraging interim results from a Phase 1 study of xaluritamig, a STEAP1 x CD3 XmAb 2+1 bispecific antibody, were presented at the European Society for Medical Oncology (ESMO) Congress in October 2023. Janssen Biotech, Inc.: Xencor received $15 million in development milestone payments under its two agreements with Janssen that are focused on the development of CD28 bispecific antibodies. Janssen submitted an IND application for a CD28 bispecific antibody targeted to an undisclosed prostate tumor target. Janssen also submitted a clinical trial application (CTA) for a bispecific candidate targeted against a B cell tumor target. Gilead Sciences, Inc.: Xencor received a $6 million development milestone payment from Gilead Sciences, which initiated a Phase 2 study evaluating two broadly neutralizing anti-HIV antibodies that incorporate XmAb Fc technologies. Omeros Corporation: Xencor received a $5 million development milestone payment from Omeros, which initiated a Phase 2 study evaluating a candidate that incorporates XmAb Fc technologies. Additional Corporate Updates In September, Xencor appointed Barbara J. Klencke, M.D., to its board of directors. Dr. Klencke is a world-class, patient-focused research and development expert, who has a successful track record in development and early commercialization of several medicines approved for the treatment of patients with cancer. She most recently served as chief medical officer and chief development officer at Sierra Oncology through mid-2023. John Kuch, senior vice president and chief financial officer, plans to retire in March 2024, after a successful 23-year career with Xencor. The Company is initiating a search for a new chief financial officer. Monjuvi® and Minjuvi® are registered trademarks of MorphoSys AG. Ultomiris® is a registered trademark of Alexion Pharmaceuticals, Inc. Financial Results for the Third Quarter and Nine Months Ended September 30, 2023 Cash, cash equivalents, receivables and marketable debt securities totaled $541.4 million as of September 30, 2023, compared to $613.5 million as of December 31, 2022. Net proceeds from the OMERS transaction are not included in this figure. Total revenue for the third quarter ended September 30, 2023 was $59.2 million, compared to $27.3 million for the same period in 2022. Revenues earned in the third quarter of 2023 were primarily from milestone revenue from Alexion, Gilead, Janssen and Omeros, and royalty revenue from Alexion compared to the same period in 2022, which were primarily royalties from Alexion and Vir Biotechnology. Revenues for the nine months ended September 30, 2023 were $123.6 million, compared to $143.0 million for the same period in 2022. Revenue for the nine-month period in 2023 were primarily from research revenue from our second Janssen collaboration, royalty revenue from Alexion and milestone revenue from Alexion, Gilead, Janssen, Omeros and Zenas, compared to the same period in 2022, which were earned primarily from milestone revenue from Astellas and royalty revenue from Alexion, MorphoSys and Vir. Research and development (R&D) expenses for the third quarter ended September 30, 2023 were $64.9 million, compared to $53.3 million for the same period in 2022. Increased R&D spending for the third quarter of 2023 compared to 2022 is primarily due to increased spending on development programs including vudalimab, XmAb541, and other research and early-stage programs. R&D expenses for the nine months ended September 30, 2023 were $189.4 million, compared to $148.1 million for the same period in 2022. Increased R&D spending for the first nine months of 2023 compared to 2022 is primarily due to an increase in spending on our new development programs including XmAb541, as well as spending on our vudalimab, XmAb819, XmAb564, and other research and early-stage programs. General and administrative (G&A) expenses for the third quarter ended September 30, 2023 were $12.5 million, compared to $12.4 million for the same period in 2022. G&A expenses for the nine months ended September 30, 2023 were $37.9 million, compared to $34.7 million for the same period in 2022. Increased G&A spending for the first nine months of 2023 compared to the same periods in 2022 reflects increased spending on professional services and additional facility costs. Other income (expense) for the third quarter ended September 30, 2023 was $(6.0) million and is comprised of unrealized loss on equity investments over interest income for the period, compared to $6.7 million for the same period in 2022 which is primarily unrealized gain on equity investments. Other income (expense) for the nine months ended September 30, 2023 was $(3.4) million, compared to $(2.2) million for the same period in 2022. The increase in other expense for the nine months ended September 30, 2023 over other expense for the same periods in 2022 is due to a higher unrealized loss from equity investments, partially offset by additional interest income earned. Non-cash, stock-based compensation expense for the nine months ended September 30, 2023 was $39.1 million, compared to $36.2 million for the same period in 2022. Net loss for the third quarter ended September 30, 2023 was $24.3 million, or $(0.40) on a fully diluted per share basis, compared to net loss of $32.8 million, or $(0.55) on a fully diluted per share basis, for the same period in 2022. Decreased net loss in the third quarter of 2023 compared to 2022 is primarily due to additional income earned. For the nine months ended September 30, 2023, net loss was $107.0 million, or $(1.77) on a fully diluted per share basis, compared to net loss of $43.1 million, or $(0.72) on a fully diluted per share basis, for the same period in 2022. Increased net loss in the first nine months of 2023 compared to 2022 is primarily due to decreased royalties from Vir and increased R&D expenses. The total shares outstanding were 60,665,900 as of September 30, 2023, compared to 59,773,337 as of September 30, 2022. Financial Guidance Based on current operating plans and considering the net proceeds from the royalty sale transactions, Xencor expects to have cash to fund research and development programs and operations into 2027. The Company expects to end 2023 with between $615 million and $665 million in cash, cash equivalents and marketable debt securities. Conference Call and Webcast Xencor will host a conference call and webcast today at 4:30 p.m. ET (1:30 p.m. PT) to discuss the third quarter 2023 financial results and provide a corporate update. The live webcast may be accessed through “Events & Presentations” in the Investors section of the Company’s website, located at investors.xencor.com. Telephone participants may register to receive a dial-in number and unique passcode that can be used to access the call. A recording will be available for at least 30 days. About Xencor, Inc. Xencor is a clinical-stage biopharmaceutical company developing engineered antibodies and cytokines for the treatment of patients with cancer and autoimmune diseases. More than 20 candidates engineered with Xencor's XmAb® technology are in clinical development, and three XmAb medicines are marketed by partners. Xencor's XmAb engineering technology enables small changes to a protein's structure that result in new mechanisms of therapeutic action. For more information, please visit . Forward-Looking Statements Certain statements contained in this press release may constitute forward-looking statements within the meaning of applicable securities laws. Forward-looking statements include statements that are not purely statements of historical fact, and can generally be identified by the use of words such as “potential,” “can,” “will,” “plan,” “may,” “could,” “would,” “expect,” “anticipate,” “seek,” “look forward,” “believe,” “committed,” “investigational,” and similar terms, or by express or implied discussions relating to Xencor’s business, including, but not limited to, statements regarding planned clinical trials, the quotations from Xencor's president and chief executive officer, contract negotiations, planned regulatory submissions, projected amounts of cash, cash equivalents and marketable debt securities and other statements that are not purely statements of historical fact. Such statements are made on the basis of the current beliefs, expectations, and assumptions of the management of Xencor and are subject to significant known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements and the timing of events to be materially different from those implied by such statements, and therefore these statements should not be read as guarantees of future performance or results. Such risks include, without limitation, the risks associated with the process of discovering, developing, manufacturing and commercializing drugs that are safe and effective for use as human therapeutics and other risks, including the ability of publicly disclosed preliminary clinical trial data to support continued clinical development and regulatory approval for specific treatments, in each case as described in Xencor's public securities filings. For a discussion of these and other factors, please refer to Xencor's annual report on Form 10-K for the year ended December 31, 2022 as well as Xencor's subsequent filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. This caution is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended to date. All forward-looking statements are qualified in their entirety by this cautionary statement and Xencor undertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof, except as required by law. Xencor, Inc. Condensed Balance Sheets (in thousands) September 30, December 31, 2023 2022 (unaudited) Assets Current assets Cash and cash equivalents $ 52,733 $ 53,942 Marketable debt securities 412,827 526,689 Marketable equity securities 28,972 42,431 Accounts receivable 55,000 28,997 Prepaid expenses and other current assets 21,644 23,283 Total current assets 571,176 675,342 Property and equipment, net 68,035 59,183 Intangible assets, net 18,744 18,500 Restricted cash 378 - Marketable debt securities - long term 20,420 3,826 Marketable equity securities - long term 64,210 54,383 Right of use asset 34,807 34,419 Other assets 660 613 Total assets $ 778,430 $ 846,266 Liabilities and stockholders’ equity Current liabilities Accounts payable and accrued liabilities $ 39,439 $ 28,816 Deferred revenue 9,222 30,320 Lease liabilities 4,380 4,708 Total current liabilities 53,041 63,844 Lease liabilities, net of current portion 56,379 54,926 Total liabilities 109,420 118,770 Stockholders’ equity 669,010 727,496 Total liabilities and stockholders’ equity $ 778,430 $ 846,266 The 2022 balance sheet was derived from the 2022 annual financial statements included in the Form 10-K that was filed on February 24, 2023 Xencor Inc. Condensed Statements of Comprehensive Income (Loss) (in thousands, except share and per share data) Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022 (unaudited) Revenues $ 59,164 $ 27,299 $ 123,649 $ 142,969 Operating expenses: Research and development 64,939 53,273 189,378 148,111 General and administrative 12,493 12,374 37,901 34,738 Total operating expenses 77,432 65,647 227,279 182,849 Loss from operations (18,268 ) (38,348 ) (103,630 ) (39,880 ) Other income (expense), net (6,000 ) 6,677 (3,357 ) (2,171 ) Loss before income taxes (24,268 ) (31,671 ) (106,987 ) (42,051 ) Income tax expense — 1,088 — 1,088 Net loss (24,268 ) (32,759 ) (106,987 ) (43,139 ) Other comprehensive gain (loss) Net unrealized gain (loss) on marketable debt securities 1,151 (931 ) 6,244 (8,366 ) Comprehensive loss $ (23,117 ) $ (33,690 ) $ (100,743 ) $ (51,505 ) Net loss per share: Basic and diluted net loss per share $ (0.40 ) $ (0.55 ) $ (1.77 ) $ (0.72 ) Weighted-average number of common shares used in net loss per share applicable to common stockholders - basic and diluted 60,621,534 59,716,594 60,387,163 59,564,985