WHWK - NASDAQ

Ladies and gentlemen, thank you for standing by. Welcome to Whitehawk Therapeutics Fourth Quarter and Full Year 2024 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. I would like now to turn the conference over to Audrey Gross, Head of Corporate Communications for Whitehawk Therapeutics. Ms. Gross, please go ahead.

Thank you. Good morning, and welcome to the Whitehawk Therapeutics conference call. We will be presenting slides as part of the live webcast of this call. Such slides will be posted on the Investor News page of the Whitehawk Therapeutics website at whitehawktx.com following the conference call. A reminder that statements made on the call today will include forward-looking statements. Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties and other factors, including those set forth in the Risk Factors section of our annual and quarterly filings with the Securities and Exchange Commission, which can be found at www.sec.gov or on our website at whitehawktx.com. In addition, any forward-looking statements made on this call represent our views only as of today, March 19, 2025, and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements. On the call today is Dr. Dave Lennon, our President and CEO; Scott Giacobello, our CFO; and Dr. David Dornan, our newly appointed CSO. Today, we will introduce Whitehawk Therapeutics and provide an overview of Q4 and full year 2024 financial results before turning the line open for questions. I'll now turn the call over to Dave. Dave?

Thanks, Audrey. Hello, everyone. Good morning. Thank you for joining. I'm Dave Lennon, the President and CEO of the newly launched Whitehawk Therapeutics. We are extremely excited about the transformation from Aadi Biosciences to Whitehawk. I look forward to walking you through our vision, strategy, and opportunity, and what we -- the opportunity we have to deliver a meaningful impact for patients with our advanced ADC portfolio. As a reminder, in December, we announced a series of strategic transactions, including the in-licensing of 3 ADCs from Wuxi Biologics, the divestiture of FYARRO to Kaken Pharmaceuticals, and $100 million pipe financing that were subsequently approved during a special meeting of stockholders last month. As a next step in our evolution Aadi Biosciences is now divided into two organizations. Upon the divestiture of Aadi's subsidiary to Kaken. Kaken will assume ownership of the Aadi name, trademark, and the FYARRO business. And today, Aadi Parent Company, relaunches as Whitehawk Therapeutics, formalizing our transition into an ADC-focused company. While we remain rooted in our legacy, that is to make bold choices in applying technology to deliver improved precision oncology therapies, Whitehawk carries several important distinctions. As Aadi, we were focused on mTOR inhibition in rare cancer settings and were built on the foundation of a single commercial product. Conversely, Whitehawk is focused on rapidly progressing a multi-asset portfolio of advanced ADC therapy, all with the broad potential to make a meaningful difference in a large number of different cancer populations. Turning to Slide 6, as Whitehawk, we developed a framework that establishes a clear value proposition and investment thesis as an ADC company. Firstly, we are building on the foundation of established tumor biology. We are deliberate in identifying promising tumor targets that are both clinically validated and broadly overexpressed. By leveraging clinical validation, we know we have drug-able tumor targets. And because these targets are broadly overexpressed, we can apply them to high-potential cancer indications with significant patient populations and unmet needs. While first-generation ADCs offered significant advances for patients, we know they were hindered by limitations largely driven by lack of therapeutic index. To overcome these challenges, we are applying an advanced ADC platform technology that is engineered for minimal off-target toxicity, greater stability and higher therapeutic index compared to first-generation predecessors. Lastly, we are hyper focused on speed and efficiency to major data inflections. We are rapidly advancing our portfolio to the clinic with INDs for all three candidates anticipated in the next 15 months. So what are these candidates? Looking at Slide 7, our portfolio consists of three assets focused on validated tumor targets. HWK-007 targets protein tyrosine kinase 7 or PTK7. PTK7 is an oncofetal pseudokinase that drives early embryonic development. Subsequently as minimally expressed in adult tissues but becomes highly overexpressed in a broad range of tumors as they arise. There are no approved PTK7 ADCs, though it is becoming a popular target for research given this broad and deep overexpression in multiple cancers. HWK-016 is the only known ADC that targets the membrane-bound portion of MUC16, a glycoprotein with low level of expression in normal adult tissues, but often overexpressed and even shed from tumors of female origin, including ovarian cervical and endometrial cancers. Shed MUC16, better known as CA125 is a biomarker for cancer screening and disease monitoring, especially in ovarian cancer. So MUC16 is a widely utilized and clinically validated target for ovarian cancer and was previously studied as an ADC target by Genentech, who had two different ADCs against MUC16. And we have HWK-206, which is designed to address the neuronal target seizure protein 6 or SE

Thanks, Dave. Moving to Slide 14. We ended 2024 with $47.2 million in cash, cash equivalents and short-term investments. Following the close of our recent strategic transactions, we expect to have cash and cash equivalents in the range of $170 million to $180 million, including the payment of the upfront and early milestones under the ADC license agreement. We anticipate that cash will fund operations into 2020 based on current plans. FYARRO net product sales were $7.2 million for the fourth quarter, representing 14% growth over the prior year quarter. Full year FYARRO sales were $26 million, an increase of 7% over 2023. Research and development expenses for the quarter increased to $14.3 million compared to $12.8 million in the prior year quarter. For the year, R&D expense amounted to $51 million compared to $48.9 million last year. This increase is driven mainly by in-process R&D expenses of $6 million related to the recently acquired ADC programs, offset in part by reductions in clinical expenses, personnel, and other expenses. Selling, general and administrative expenses for the fourth quarter were $11.1 million compared to $10.3 million in the same period in 2023. This increase was due mainly to increased legal and consulting expenses offset in part by lower commercial expenses. For the year, SG&A expenses decreased to $36.7 million compared to $44.5 million in the prior year, driven primarily by reductions in commercial and personnel expenses. Operating expenses for the year included $2.6 million of restructuring costs. Net loss for the fourth quarter was $18.3 million compared to $16.3 million in the fourth quarter of 2023. Net loss for the year was $63.7 million compared to $65.8 million in the prior year. I'll now hand the call back over to Dave for his closing comments. Dave?

Thanks, Scott. Looking to Slide 16. We are enormously excited about the potential of Whitehawk to make a transformative impact to patients with our portfolio. We're advancing three clinically validated tumor targets using next-generation ADC technology with the goal of outperforming first-generation predecessors. With a focus on high potential indications, we aim to file three U.S. INDs within 15 months. And we're well positioned to fund operations, as Scott said, into 2028, covering anticipated clinical inflections. Importantly, Whitehawk is backed by an outstanding veteran team. I'm also pleased to say this includes our recent addition of David Dornan, who joined us as Chief Scientific Officer. Many of you will know David, as the former CSO of Elevation Oncology. David contributes more than 2 decades of experience in oncology drug, discovery and development with deep expertise in ADCs and other targeted cancer therapies. He has a successful track record of separating drugs from discovery stage through the clinic for advanced modalities, including ADCs, encompassing numerous INDs, NDAs and BLAs. His experience at Elevation is particularly relevant as the spearhead of the company's strategic pivot towards a portfolio of ADCs. We welcome David, and glad he is able to join us on the call today. With that, I'll open the call for questions.

Thank you. [Operator Instructions] And the first question will come from Tara Bancroft with TD Securities.

Hi, this is Greg Weasner on for Tara Bancroft. So considering that Regeneron is developing a Mucin 16 targeted bispec antibody for ovarian, how do you anticipate that the clinical activity and safety profile of your ADC might compare to the bispecific approach within this indication? Thank you.

Super. Thanks, Greg, for stepping in for Tara, and thanks for the question. I'll start a little bit and then turn it over to David for his comments since he is an expert in this target. I mean the first concept is, obviously, ADCs and bispecific TCEs are very different modalities in terms of their mechanism. Certainly, there's commonality in the tumor targeting. And we're encouraged by the fact that Regeneron uses the same targeting approach to the membrane-bound type MUC16. But obviously, as a TCE that is targeting an immune modulating response, which will be very different from an ADC chemo-based response that we're developing here. We think both are complementary and important options for patient treatment regardless of the tumor target here. So we don't necessarily have a direct comparison we would highlight for this indication, but we do, obviously, pay close attention to that program. But David, do you want to say a little more about MUC16?

Yeah, sure. I think this is what is fair to say with respect to targeting, obviously, the membrane portion that we're targeting MUC16 certainly makes it help avoid antigen sync, as Dave has mentioned in the presentation. And with respect to the different modalities of targeting, I think you specifically asked about the CD3 redirection approach. I think it's fair to say like a CD3 redirection approach, sometimes they have challenges with like a cytokine release like syndrome. So obviously, as a cytotoxic ADC, we don't have the same AE problems in that realm. But obviously, with our ADC, cytox ADCs, they certainly have their own profiles, but the promise of our technology using our stable linker technology really will mitigate that potential risk. And so that's how we feel that positioning wise that this ADC will certainly be differentiated from a CD3 redirected, but largely would have significant gains and efficacy, as Dave already mentioned.

Thanks, Greg. Operator, next question?

And our next question will come from Roger Song with Jefferies. Your line is open.

Good morning, thanks for taking our question. This is Liang Cheng on for Roger. First, congrats on the new chapter. So I guess, question from us. One is on the three targets. So understanding the prevalence there. So maybe could you help us understanding about the distribution of the high, medium, low expression levels for each of these three targets. And the second question is about the financials. So understanding about 2028 runway. So does that cover all the three Phase 1 studies? Thank you.

Liang, thanks again. Thanks for joining the call. Good to hear from you again. And thanks for the questions. So on the first question, in terms of the prevalence, obviously, there's a lot of data to cover in context. What we would say is that, first on PTK7, it is one of the most broadly overexpressed tumor targets in development today. And so it impacts a large portion of patients who develop cancer overall, very highly expressed target, also a broad range of tumor types. What we really like about this target is that when it is expressed in patients, it's often expressed at a moderate to high level. So we'll generally find that the majority of patients who express PTK7 do so across different cancers, which we know correlates with potential for improved responses as patients who have higher expression generally responding better. And so we're really encouraged by both of those, the broad expression of PTK7, but also the relatively deep impression that we see in individual patients, a high proportion of patients that potentially could respond very well to therapy. On MUC16, it's a similar story. But I think in MUC16 case, we really have an advantage that MUC16 is a tumor target that tends to increase as the disease progresses and so higher expression is often associated with worse disease. And that is -- allows us to really target the patients who are most in need of care. And secondly, with the circulating CA125, we have a proxy for expression across patients rather than looking at IHC-based expression, we can also screen patients using circulating CA125 biomarker. And so we think, in this case, we really have both this high-level compression, particularly across gynecological cancers, deep expression overall, and ability to monitor that from [Indiscernible]. And then SE

I show no further questions at this time in the queue. I would like to turn the call back to Dave for closing remarks.

Thank you, operator, and thank you to the team and everyone who joined us on the call today. We are really excited about the launch of Whitehawk Therapeutics, a new ADC company out of the transformation we've just performed with Aadi Bioscience. We reiterate these three clinically validated broadly overexpressed tumor targets are leveraging an advanced ADC linker payload architecture with key features that we believe will allow us to outperform first-generation ADCs. We're moving quickly, targeting filing of three U.S. INDs in the next 15 months, including HWK-007 in the second half of 2025, and HWK-016 by the end of this year. With our experienced team and collaborative partners, we are singularly focused on executing to ensure these goals are met. Lastly, upon closing, we expect we will capitalize. And as I mentioned, we have cash to fund our operations into 2028 and with anticipated key clinical data. So thank you for joining us for this introduction of Whitehawk Therapeutics and have a great day.