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Edited Transcript of GNCA earnings conference call or presentation 30-Apr-19 1:00pm GMT

Q1 2019 Genocea Biosciences Inc Earnings Call

Cambridge May 23, 2019 (Thomson StreetEvents) -- Edited Transcript of Genocea Biosciences Inc earnings conference call or presentation Tuesday, April 30, 2019 at 1:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Diantha Duvall

Genocea Biosciences, Inc. - CFO

* Jessica Baker Flechtner

Genocea Biosciences, Inc. - Chief Scientific Officer

* Thomas A. Davis

Genocea Biosciences, Inc. - Chief Medical Officer

* William D. Clark

Genocea Biosciences, Inc. - President, CEO & Director

* Daniel Ferry

LifeSci Advisors, LLC - MD & Relationship Manager

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Conference Call Participants

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* Chad Jason Messer

Needham & Company, LLC, Research Division - Senior Analyst

* Gil Joseph Blum

Needham & Company, LLC, Research Division - Analyst

* Joseph Pantginis

H.C. Wainwright & Co, LLC, Research Division - MD of Equity Research & Senior Healthcare Analyst

* Michael Eric Ulz

Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst

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Presentation

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Operator [1]

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Good day, ladies and gentlemen. Thank you for standing by, and welcome to the Genocea First Quarter 2019 Financial Results Conference Call. (Operator Instructions) As a reminder, this conference may be recorded.

At this time, I would like to turn the conference call over to Dan Ferry from LifeSci Advisors.

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Daniel Ferry, LifeSci Advisors, LLC - MD & Relationship Manager [2]

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Thank you, operator, and good morning, everyone. Earlier today, we issued a press release that outlines the topics we plan to discuss today. This release is available at genocea.com, under the Investors tab. During the call today, Chip Clark, President and CEO, will provide a brief corporate update. And the company's Chief Financial Officer, Diantha Duvall, will review the financial results. After the prepared remarks, we will open up the call for Q&A. And Chip; Diantha; and Tom Davis, Genocea's Chief Medical Officer, will then be available to answer your questions.

Before we begin, I would like to remind everyone that statements made during this conference call relating to Genocea's expected future performance, future business prospects or future events or plans may include forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. All such forward-looking statements are intended to be subject to the safe harbor protection provided by the Reform Act.

Actual outcomes and results could differ materially from those forecasts due to the impact of many factors beyond the control of Genocea. Genocea expressly disclaims any duty to provide updates to its forward-looking statements whether as a result of new information, future events or otherwise. Participants are directed to the risk factors set forth in Genocea's 2018 annual report on Form 10-K and other periodic reports filed with the Securities and Exchange Commission.

It is now my pleasure to pass the call over to Chip.

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William D. Clark, Genocea Biosciences, Inc. - President, CEO & Director [3]

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Thanks, Dan, and good morning, everyone. Thanks for joining us today. We continue to advance our vaccine and cell therapy programs, highlighted by GEN-009, our neoantigen vaccine candidate; and GEN-011, our neoantigen adoptive cell therapy candidate.

As we say here at Genocea, targets matter, and we continue to believe that target or antigen selection plays a large and underappreciated role in driving immunotherapy efficacy. The body of work we've amassed over the past 18 months demonstrates 2 things: first, that our antigen selection platform, ATLAS, works differently than the first-generation machine-based approaches of our peers; second and more importantly, ATLAS-identified neoantigens overlap very little with those prioritized by first-generation tools.

We believe we are on the cusp of being able to prove prospectively that these differences matter. As we've announced this morning, we plan to report the first immunogenicity data from our ongoing Phase I/IIa clinical trial at ASCO. With positive data, we would expand the Phase I/IIa clinical trial to treat cancer patients with a combination of GEN-009 plus the standard-of-care checkpoint inhibitor approved for that patient's tumor type.

Let me now briefly summarize other activities and events since our last update. In March, we welcomed Diantha Duvall as our new CFO. You'll hear from Diantha in just a moment. We presented some new ATLAS data at the meeting of the American Association for Cancer Research, or AACR, earlier this month. These data showcased a potential application for ATLAS beyond neoantigen identification.

As you know, ATLAS identifies both antigens of antitumor responses and also what we're calling inhibitory antigens. We believe only we can systematically identify these, and we've recently begun sharing data suggesting a broad immunosuppressive effect of such antigens. The AACR presentation suggested that a patient's ratio of stimulatory to inhibitory antigens may predict the advanced melanoma patients that could benefit from checkpoint inhibitor therapy.

Finally, our investment in GEN-011, our neoantigen adoptive cell therapy, continues, and we're aiming to file an IND for the program in the first half of 2020. I am now going to pass the call over to Diantha to summarize our financials for the quarter before opening the call up to questions.

Diantha?

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Diantha Duvall, Genocea Biosciences, Inc. - CFO [4]

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Thanks, Chip, and good morning, everyone. It's really a pleasure to be here and be part of the Genocea team. Our operating results for the first quarter ended March 31, 2019, are as follows. R&D expenses were $6.5 million compared to $7.3 million for the same period in 2018. G&A expenses were $3 million compared to $3.1 million for the same period in 2018. And our net loss was $15.6 million compared to a net loss of $15.9 million for the quarter ended March 31, 2018.

Also, prior to my joining, we completed a $15 million equity financing and ended the first quarter with $29 million in cash and cash equivalents. Our cash guidance remains unchanged. We continue to expect our cash to fund operations into the first quarter of 2020.

With that, let's now open up the call for questions. Operator?

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Questions and Answers

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Operator [1]

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(Operator Instructions) And our first question, coming from the line of Chad Messer with Needham.

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Chad Jason Messer, Needham & Company, LLC, Research Division - Senior Analyst [2]

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Obviously, very anxiously awaiting the data at ASCO but wanted to check in on the time lines for the next part of that study, the checkpoint inhibitor combination. When's that getting underway? And any idea when that data might be available?

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William D. Clark, Genocea Biosciences, Inc. - President, CEO & Director [3]

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Yes, Chad, thanks for the question. And let's, obviously, assume that we're reporting positive data at ASCO. In such a case, we would proceed into the rest of the trial. And I'll have Tom, our Chief Medical Officer, field the question specifically.

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Thomas A. Davis, Genocea Biosciences, Inc. - Chief Medical Officer [4]

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Sure. By current plans, we, of course, are eager to start Part B of the study as quickly as we can. We're currently predicting that we will start accrual in the middle of this year and should have preliminary data available the middle of next year. It is a fairly large effort on our part. But I think the team's doing a great job, and we should be able to meet those time lines.

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Operator [5]

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And our next question, coming from the line of Gil Blum from Needham.

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Gil Joseph Blum, Needham & Company, LLC, Research Division - Analyst [6]

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So this is a little bit about the data coming out at AACR. Is using ATLAS as a diagnostic tool commercially feasible in any way?

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William D. Clark, Genocea Biosciences, Inc. - President, CEO & Director [7]

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Gil, thanks for your question. I would first say that the data that we presented at AACR is of a different nature than the data we'll be reporting at ASCO. ASCO is about ATLAS potentially identifying the right neoantigens and also potentially excluding the wrong, the inhibitory neoantigens from a vaccine in order to make a vaccine that is more immunogenic.

I think the question that we raised and the data that we presented at AACR also in a complementary way suggests that understanding this ratio of stimulatory to inhibitory antigens could play a diagnostic role, but it would take more investment in order to convert this into an actual sort of in-practice diagnostic. Is that your question, Gil?

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Gil Joseph Blum, Needham & Company, LLC, Research Division - Analyst [8]

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Yes, my question was more about whether this is an interesting avenue to pursue further.

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William D. Clark, Genocea Biosciences, Inc. - President, CEO & Director [9]

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I'm going to have Tom field that.

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Thomas A. Davis, Genocea Biosciences, Inc. - Chief Medical Officer [10]

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Well, as I'm sure you're aware, many people have been trying to find a way to predict responses in patients, which is very useful from a clinical perspective. But more importantly, it can tell us why patients are responding and give us a whole new realm of possibilities for future therapeutics.

So from my perspective, I think ATLAS is critically important in understanding antigens and how to select them. And along the way, we'll be learning a great deal about potential correlative markers that could both predict response and could be much easier to use as a diagnostic, so I think the potential here is huge. And we will be learning much more within this next stage of the study. That said, we're obviously looking for a therapeutic for these patients, and we'll use ATLAS to focus there for the most part.

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William D. Clark, Genocea Biosciences, Inc. - President, CEO & Director [11]

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And I think what's intriguing about your question, Gil, is that it, in a way, acknowledges the difference between our platform and that of everybody else. There's a real biological answer that we are coming up with by profiling the immune responses patients make to their own tumor. That's fundamentally different than some prediction-based approach. And so there is, as you're rightly speculating, a wide range of applications for our platform.

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Operator [12]

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And our next question, coming from the line of Mike Ulz with Baird.

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Michael Eric Ulz, Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst [13]

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Just a quick question for me. And with the data coming up at the ASCO meeting, just curious if you can comment what type of data we should expect in the abstract. Our understanding is it was probably submitted earlier this year, so we may not have a -- much data in the abstract, but just wanted to get your thoughts there.

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William D. Clark, Genocea Biosciences, Inc. - President, CEO & Director [14]

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Yes, the abstract is, as you have rightly characterized, not likely to have -- it will not have postvaccination data. Tom can speak to what we put in there.

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Thomas A. Davis, Genocea Biosciences, Inc. - Chief Medical Officer [15]

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So certainly, Michael, you're aware that there is a delay between when patients are put on study and when we initiate the vaccination. And due to that, we did not have any immunogenicity data at the time the abstract was submitted. And you can assume that, that may well reflect on the positioning of the abstract at ASCO.

However, we do intend to have preliminary immunoresponsive -- immuno response data on patients from the trial at the presentation, at the poster. And just for the record, those of you who don't know, the poster is going to be hung at 8 a.m. on Saturday, June 1, and should be available for viewing then. And of course, we'll be able to talk about the data at that time.

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Michael Eric Ulz, Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst [16]

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Can I just ask a quick follow-up? At the presentation at ASCO, should we assume that you'll have immunogenicity data across all 9 patients? Or will it be a subset?

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Thomas A. Davis, Genocea Biosciences, Inc. - Chief Medical Officer [17]

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It will be subset. We won't have complete data here, but there are other opportunities to present a more complete dataset further on in the year. So we are planning to make the data available as soon as possible.

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Operator [18]

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Our next question, coming from the line of Joe Pantginis with H.C. Wainwright.

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Joseph Pantginis, H.C. Wainwright & Co, LLC, Research Division - MD of Equity Research & Senior Healthcare Analyst [19]

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While all the focus is currently on the GEN-009 immunogenicity data, and you certainly touched upon this, can you share some additional details, even if it's just broad strokes, about the work going on in the background on the science front even to further leverage your ability to identify these inhibitory antigens and show differentiation versus other technologies? And of course and related to that, can you potentially apply these inhibitory antigens therapeutically in the future?

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William D. Clark, Genocea Biosciences, Inc. - President, CEO & Director [20]

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Thanks, Joe. I will hand this question over to Jessica Flechtner, our CSO.

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Jessica Baker Flechtner, Genocea Biosciences, Inc. - Chief Scientific Officer [21]

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Joe, thanks for your question. We are really carefully examining what the mechanism of these inhibitory antigens are. As we have reported previously, we had developed a mouse model where we have shown that they are tumor promoting. And we continue to work to develop the mechanism in our research laboratories.

Whether or not these can be deployed as a therapeutic would require more time and study, so I really can't comment on that now. But what we know is that they are existing in both humans and mice that we -- that by driving cells that are responsive to these inhibitory antigens, that the mice at least get worse. And in our human subjects, we find, as you know, the proportion of inhibitory to stimulatory peptide seems to predict outcome after checkpoint blockade.

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Operator [22]

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(Operator Instructions) And at this time, I'm showing no further questions. I would like to turn the call back over to Chip Clark for closing remarks.

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William D. Clark, Genocea Biosciences, Inc. - President, CEO & Director [23]

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Thank you, Olivia.

We expect the next few months will be very exciting here at Genocea. And we remain optimistic that our efforts over the past 1.5 years especially will have positioned us to bring potentially life-saving therapies to patients. We look forward to updating you further in the coming weeks. And thanks again for joining us today.

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Operator [24]

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Ladies and gentlemen, thank you for your participation in today's conference. This concludes the program, and you may now disconnect. Good day.