BCAB - NASDAQ

Good day, everyone, and welcome to the BioAtla Second Quarter 2025 Earnings Call. [Operator Instructions] And it is my pleasure to turn today's conference over to Kristy Grabowski with Life Science Advisors. Please go ahead.

With me today on the phone from BioAtla are Dr. Jay Short, Chairman, CEO and Co-Founder; and Richard Waldron, Chief Financial Officer. Following today's call, Dr. Eric Sievers, Chief Medical Officer; and Sheri Lydick, Chief Commercial Officer, will join Jay and Rick in a short Q&A. Earlier this afternoon, BioAtla released financial results and a business update for the second quarter ended June 30, 2025. A copy of the press release and corporate presentation are available on the company's website. Before we begin, I'd like to remind everyone that statements made during this conference call will include forward-looking statements, including, but not limited to, statements regarding BioAtla's business plans and prospects and whether its clinical trials will support registration, timing of and ability to form collaborations and other strategic partnerships for selected assets, results, conduct, progress and timing of its research and development programs and clinical trials, expectations with respect to enrollment and dosing in its clinical trials, plans and expectations regarding future data updates, clinical trials, regulatory meetings and regulatory submissions, the potential regulatory approval path for its product candidates; expectations about the sufficiency of its cash and cash equivalents to fund operations and expected R&D expenses and cash burn. These statements are subject to various risks, assumptions and uncertainties that can cause actual results to differ materially and are described in the filings made with the SEC, including the most recent annual report on Form 10-K and subsequent quarterly reports on Form 10-Q. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today, August 7, 2025, and BioAtla disclaims any obligation to update such statements to reflect future information, events or circumstances, except as required by law. With that, I'd like to turn the call over to Dr. Jay Short. Jay?

Thank you, Kristy, and thanks to everyone for joining us for our second quarter 2025 BioAtla earnings call. Details related to what we will share today are available in today's press release and our updated company presentation, both of which are available on our website. Also, the posters and oral presentations, which were recently presented at various conferences are available on our website. I will begin today's update with our dual conditionally binding EpCAM CD3 T cell engager, BA3182. We are encouraged with the progress of our Phase I dose escalation study and recently presented interim data at the ESMO GI and ESMO Targeted Anticancer Therapies Congresses. Based on preliminary data, BA3182 continues to be acceptably tolerated using a priming dose of 0.1 milligrams followed with higher treatment doses, a strategy successfully employed with marketed T cell engagers. BA3182 has demonstrated evidence of objective tumor reductions in 7 heavily pretreated adenocarcinoma patients across multiple solid tumors, including advanced widely metastatic cancers of the colon, breast, bile ducts, lung and pancreas. Notably, in the most recent cohort receiving weekly subcutaneous doses of 0.6 milligrams, all 5 evaluable patients have achieved stable disease and continue on treatment. We are currently dosing the 1.2 milligram cohort and remain on track for a Phase I data readout expected in the second half of this year with a further dose expansion data readout anticipated in the first half of 2026. We continue to believe that our dual CAB EpCAM CD3 bispecific T cell engager could be at the forefront of a novel approach to harnessing the body's immune system to target and destroy cancer cells. Because EpCAM is widely expressed, BA3182 has the potential to serve over 1 million patients spanning a wide range of metastatic solid tumors, including cancers of the colon, lung, breast, pancreas and prostate, among others. Next, regarding our CAB-ROR2-ADC Oz-V, last quarter, we reported compelling antitumor activity in patients with metastatic HPV- positive head and neck cancer. This is a large and growing patient population that is poorly served by the current standard of care and largely resistant to existing and emerging EGFR-related therapies. In our cross-trial comparison, Oz-V demonstrated a resounding ORR of 45% compared to only 3.4% for the standard of care using methotrexate, docetaxel or cetuximab. Oz-V also showed median overall survival of 11.6 months, which is still ongoing compared to the standard of care of only 4.4 months. We previously received actionable FDA guidance on a pivotal trial in the second-line plus setting in head and neck cancer, whereby the agency conveyed support of a proposed pivotal randomized controlled trial of Oz-V monotherapy versus investigator's choice. This study would use the dual primary endpoints of ORR and OS. We now have a scheduled meeting with the FDA in the third quarter of this year for guidance on a proposed Phase III study in treatment refractory metastatic HPV-positive oropharyngeal squamous cell carcinoma. We believe with our compelling ORR and OS data, we have an opportunity for accelerated approval followed by full approval. Regarding our pipeline assets, Mec-V and evalstotug, we have compelling and differentiated emerging clinical profiles. Mec-V, our CAB-AXL-ADC has demonstrated exceptional overall survival among heavily pretreated patients with mKRAS non-small cell lung cancer across multiple mKRAS variants with 1-year and 2-year landmark survival of 67% and 59%, respectively, to date. AXL expression is a fundamental driver of tumor resistance leading to poor patient outcomes and survival. Mec-V offers the potential opportunity to address the tumor resistance associated with IO or mKRAS inhibitor therapies and has an efficacy and safety profile that may allow it to work as either a monotherapy or as a combination therapy in refractory patients. In addition, evalstotug, our CAB-CTLA-4 antibody, has demonstrated potent antitumor activity with reduced immune-mediated adverse events in a metastatic melanoma population who have experienced progression after adjuvant and neoadjuvant therapy regimens that include PD-1 LAG-3 and/or CTLA-4. Now with respect to our corporate updates, BioAtla intends to present its plan to NASDAQ to regain and sustain compliance with listing requirements. As for our clinical communications, I am pleased to report our progress with the medical and scientific communities as acknowledged by our ongoing abstract acceptances at medical conferences. Additionally, we have an abstract accepted for poster presentation at the upcoming ESMO Annual Meeting in October, where we will present updated Phase I data on BA3182. We are progressing partnering discussions across our CAB portfolio given the strength and translatability of our technology and the advanced Phase II and Phase III-ready clinical stage of our assets. Notably, diligence has been successfully completed for one of these assets, and we are now at the term sheet stage. As a result, we believe that we are on track to close the transaction this year. With that, I would now like to turn the call over to Rick to review the second quarter 2025 financials. Rick?

Thank you, Jay. Research and development or R&D expenses were $13.7 million for the quarter ended June 30, 2025, compared to $16.2 million for the same quarter in 2024. The decrease of $2.5 million was primarily due to a $1.2 million decrease in headcount- related expenses, including the impact of our workforce reduction announced in March 2025, a $0.6 million decrease in program development expenses in 2025 due to program prioritization efforts implemented previously and our ongoing work on completing Phase II trials in several indications and a $0.6 million decrease in noncash stock-based compensation expense. We expect our R&D expenses to continue to decrease for the remainder of 2025 as we complete the Phase II trials for several indications and focus our ongoing development on our prioritized programs. General and administrative or G&A expenses were $5 million for the quarter ended June 30, 2025, compared to $5.8 million for the same quarter in 2024. The $0.8 million decrease was primarily due to lower stock-based compensation and lower headcount-related expenses related to our workforce reduction. Net loss for the quarter ended June 30, 2025, was $18.7 million compared to a net loss of $21.1 million for the same quarter in 2024. Net cash used in operating activities for the 6 months ended June 30, 2025, was $30.4 million compared to net cash used in operating activities of $50 million for the same period in 2024. Cash used for the quarter ended June 30, 2025, was $14.1 million, including $0.6 million in costs related to our workforce reduction. We expect our quarterly cash burn to decrease as we continue to close out Phase II clinical trials for several indications. Cash and cash equivalents as of June 30, 2025, were $18.2 million compared to $49 million as of December 31, 2024. The company is primarily pursuing nondilutive funding through partnering in the development and commercialization of certain CAB programs. The company continues to take additional cash preservation measures by controlling expenses and monitoring encouraging progress for near-term milestone payments while progressing partnership discussions that support key clinical activities and readouts. These activities, along with upcoming data readouts from our EpCAM Phase I trial have the potential to lead to transformational value creation for the company and its stockholders. Now back to Jay.

Thank you, Rick. BioAtla continues to progress our clinical trials as well as partnering discussions across our CAB platform. We are positioning our ROR2 asset, Oz-V for a planned Phase III study, and we'll garner additional guidance during our scheduled meeting with the FDA later this quarter. We are also encouraged with our Phase I dose escalation study evaluating our dual conditionally binding EpCAM and CD3 bispecific T cell engager and look forward to our Phase I data readout expected later this year. Finally, we continue to carefully manage our cash resources and remain confident that we will close one or more partnering transactions this year. Thank you for your time today. With that, we will turn it back to the operator to take your questions.

[Operator Instructions] We'll take our first question from Arthur He with H.C.

So just a couple of questions on the EpCAM program. So regarding the expansion cohort study, have you guys decided which indication to go after? Or in other way, what kind of criteria or we are thinking about how to choose the indication wise?

Eric, you should grab that one.

Arthur, thank you for your question. We're looking at a variety of indications, but colorectal cancer is particularly attractive given the very high EpCAM expression across those tumors, and it's also a very high expression HER tumor with 3-plus staining. And there's a marked unmet need for patients with advanced metastatic colorectal cancer. And so while we've not formally made a decision, we are leaning in that direction. And I do want to also point out that cholangiocarcinoma is an attractive indication with very few available therapies, no approved therapies in the second-line setting, and we provided scans and showing a patient with 13% reduction and now 21 weeks without progression on study. So that's another attractive indication.

Got you. And second question, speak of the colorectal cancer. I noticed so you have 2 patients has tumor reduction level. Just curious, have you guys disclosed which dose cohort those 2 patients are in?

I'm happy to also take that, Arthur. On Slide 24 of our corporate deck, we've updated that to now have 3 patients with colorectal cancer with disease reduction of minus 6%, minus 8% and minus 10%. Some of those occurred with the IV dosing before we shifted to subcutaneous dosing. And we've also added another patient with pancreas cancer, minus 5% to make a total of 7 individuals that have had objective tumor size reductions.

I see. How about the corresponding dosing cohort for the...

We will be updating that possibly -- we'll be updating it later this year. We also are presenting at ESMO in October, but I don't know whether we'll do it there or a little bit later in the year, but it will be sometime in the second half here.

[Operator Instructions] And there are no further questions on the line at this time. I'll turn the program back to our presenters for any additional or closing remarks.

I'd like to say that I'm looking forward to the feedback from the FDA on the Oz-V asset. Also looking forward to [ EpCAM ] readouts. And I'm very pleased that we've been able to agree with a partner on the major terms for -- term sheet for partnership with one of our Phase II assets. And so we appreciate you taking the time today, and we look forward to continuing to our next call.