Greetings and welcome to X4 Pharmaceuticals Third Quarter Financial and Operating Results Conference Call. At this time, all participants are in a listen-only. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host Dan Ferry of LifeSci Advisors.

Please begin..

Thank you operator and good morning everyone. Thanks for joining us. Presenting on today's call will be X4's Chief Executive Officer, Dr. Paula Ragan and the company's Chief Financial Officer, Adam Mostafa. Following prepared remarks by each, we will open the call to your questions.

And we'll be joined by Chief Scientific Officer, Art Taveras; Chief Medical Officer, Diego Cadavid; and Chief Operating Officer, Mary DiBiase. As a reminder, on today's call the company will be making forward-looking statements regarding regulatory and product development plans as well as research activities.

These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted. A description of these risks can be found in X4's most recent filings with the SEC. I'd now like to turn the call over to Paula Ragan.

Paula?.

Thanks Dan and thank you everyone for joining us on the call this morning where we plan to discuss our upcoming presence at the ASH December meeting along with highlights of the recent quarter and our financial results.

In doing so, we hope to convey the level of excitement here at X4 as we head into what promises to be a catalyst-rich period for the company. As we detailed in the press release that just went out, we have had all seven or our submitted abstracts accepted for publication at ASH with four accepted to presented as posters.

This conference will be the largest presence ever for X4 at a medical meeting and it represents the culmination of several years of incredibly hard work and success across our entire organization.

We also just announced that we will be hosting an Investor Day on December 16th just following the ASH Meeting to discuss the data in greater depth and to hear from a number of prominent key opinion leaders who will help put all these data into context. So, please save the date for that X4 event.

The abstract published today on the ASH website contain a very broad array of both clinical and scientific data. Data that we believe not only further establishes X4 leader in the CXCR4 space, but that also support the broadening scope of the clinical potential of our lead candidate mavorixafor.

As you know mavorixafor is the only CXCR4 antagonist being developed in an oral once-daily formulation. We are currently conducting three clinical trials of mavorixafor across a number of indications. The first is our global pivotal Phase 3 trial in people with WHIM syndrome.

Importantly, we achieved a major milestone in early October completing enrollment in the Phase 3 clinical trial. 31 adults and pediatric patients have been enrolled in the trial which was originally designed to enroll 18 to 28 patients with WHIM syndrome. Topline data from this trial are anticipated in the fourth quarter of 2022.

WHIM is a rare inherited primary immunodeficiency caused by a variety of mutations in the CXCR4 receptor gene that cause immune cell dysregulation.

This dysregulation inhibits the proper maturation process for the entire range of white blood cells and causes them to get trapped in the bone marrow preventing healthy trafficking and systemic circulation.

This results in life-long challenges for the health and wellbeing of WHIM patients including severe recurrent and sometimes life-threatening infections, loss of lung function and hearing, and significantly, increased risk to HPV associated cancers.

By correcting this CXCR4 dysfunction, mavorixafor has been shown to not only increase the level of the circulating neutrophils, monocytes, and lymphocytes in WHIM patients, but also to reduce the number and severity of annual infections and to reduce warts caused by unchecked HPV infection.

One of our abstracts accepted for poster presentation at ASH further highlights similarly positive data from our ongoing Phase 2 open-label extension trial in patients with WHIM and includes patient interviews that reveal that all four of the continuing study participants experienced good tolerability and beneficial treatment effects with dosed mavorixafor before a long-term.

Also relating to WHIM several of the abstracts published this morning focused on WHIM causing on CXCR4 mutation variants and on the US prevalence of the disease. As quick background, there have been 16 WHIM causing CXCR4 receptor mutations identified to-date. All of which have been located in the internal pale known as the C-terminus of the receptor.

Driven by our patient identification efforts and the collaboration and clinical trial screening efforts, we have identified a host of patients with both these known CXCR4 variants and also novel CXCR4 mutations.

As a result, we have been able to better learn about the disease spectrum of WHIM both clinically and genetically and had established research that enables the correlation of a patient's WHIM symptoms with increased CXCR4 signaling caused by genetic mutations. This is referred to as genotype-phenotype correlations.

In the abstract describing a novel variant, we specifically publish on our first discovery resulting from these efforts which describe a novel misspent mutual called D84H discovered in collaboration with treating physicians and expert scientists. The D84H mutation is the first mutation identified outside of the C-terminus of the CXCR4 receptor.

And we have shown through our internal research that this mutation causes gain of function signaling correlating with the disease phenotype of WHIM patients.

To look further into this newly identified mutation, we also analyzed multiple broad population genomic database which helped us determine that the allele frequency of the D84 H mutation is very high in the generalized population.

Using the current US population and a conservative estimate of 5% to 10% of individuals who go onto develop the disease systems also known as penetrants, these data support that there are at least 1,250 to 2,500 WHIM patients in the US resulting from the D84H mutation alone.

We have found multiple D84H patients from different families across the world, in the brief time since the discovery, which further validates the finding.

We plan for further patient identification efforts to deepen the validation of the D84H prevalence estimate and to explore similarly identified CZCR4 variants that impact prevalence estimates in 2022 and beyond.

Together this patient identification and bench to bedside research, along with our prior market research and our artificial intelligence research published in the ASH Abstracts continues to reaffirm our belief that WHIM is a significantly under recognized and under diagnosed condition.

And that the true population may be much larger than is currently reported. We plan to go into more detail regarding our ongoing patient finding activities at our investor event in December.

But needless to say we are very encouraged by the results that our studies are elucidating building support and awareness to the rare disease physician community as we continue to ramp up our pre-commercial activities in advance of our expected Phase 3 topline data, which as I mentioned are anticipated in the fourth quarter of 2022.

Let's now shift to updates on our ongoing clinical trial chronic neutropenia, which is an indication that nicely leverages our successful experiences with WHIM syndrome, our broader trial experiences and input from our clinical communities.

We believe that treatment opportunity for mavorixafor in chronic neutropenia is quickly becoming an additional key value driver for X4 based on new long-term data.

Specifically one of the ASH abstracts accepted for poster presentation demonstrates that mavorixafor alone or in combination with other therapies acutely and chronically increases total peripheral white blood cell counts; 1.5 to 3 times baseline across a number of different diseases in both the presence and absence of the CXCR4 mutations.

This suggest that mavorixafor can uniquely provide benefit to patients with broad chronic neutropenia conditions. And given its profile as an oral once-daily administration, we believe mavorixafor is positioned to potentially become standard of care and a treatment landscape only addressed currently by injectible therapies.

Based on the extensive and long-term data, we presented at in the Abstract and based on input from our clinical advisors, we have amended our ongoing Phase 1b neutropenia trial to include a broader range on neutropenia conditions including, patients with severe and moderate neutropenia.

We are now also enrolling all patients whether or not they are being treated with the standard of care, which is Granulocyte colony-stimulating factor or G-CSF and whether or not they're neutropenia is caused by a genetic mutation.

The trial is assessing, the safety and tolerability of two weeks of dosing in cohort A and a single dose of mavorixafor cohort B and measuring the affects of doses on patient neutrophil, counts along with other white blood cell types.

We've also modified the number of patients to be enrolled to 25, a number we believe will be sufficient to complete the goals of the trial. Our third ongoing trial with mavorixafor is designed to demonstrate safety dose and elucidate proof of concept in a rare B-cell lymphoma called Waldenstrom macroglobulinemia.

While greater than 90% of patients with Waldenstrom, have acquired mutations in what's called the MYD88 gene a subset about 30% to 40% also have acquired mutations in CXCR4.

There is a significant clinical unmet need in these double mutation patients where the presence of the CXCR4 mutation, as with WHIM patients causes white blood cells including their abnormal b-cells to become stuck in the bone marrow. This sequestration of cells can prevent patients from responding well to standard of care BTK inhibitor treatments.

This can manifest as delayed response inferior depth of response and/or shorter progression-free survival. Our Phase Ib trial is evaluating the safety and tolerability of mavorixafor for in front line and treatment refractory Waldenstrom patients, at doses of 200, 400 and 600 milligrams in combination with ibrutinib.

Both agents are delivered orally once daily in patients with confirmed MYD88 and CXDR4 mutations. The study is also measuring change from baseline in IgM and hemoglobin pharmacokinetics and pharmacodynamic markers which include measurements of peripheral white blood cell counts, in addition to, measuring clinical response rate.

As you may recall this past June, we presented the first status in this initial trial and an e-poster at the 2021 European Hematology Association Meeting. In the poster and on our investor call that day, we presented details around the first eight patients enrolled in the study.

Those data were very encouraging with mavorixafor for ibrutinib demonstrating good tolerability and biomarker data suggesting best in class potential for this combination treatment.

Because the cutoff date for the ASH abstract filing was so close to this event and data announcement, the ASH -- the abstract contains a fairly modest amount of incremental data beyond what we presented at EHA.

As of the abstract cutoff date of June 15, 2021 the overall response rate, which is minor response or better in the eight patients evaluated at the time was 100% with four of the eight patients achieving a major response which is greater than a 50% reduction in serum IgM and one of the eight patients achieving a very good partial response which is greater than a 90% reduction in serum IgM.

We do plan to have additional data at the ASH poster with a data cutoff of mid-October and we look forward to a deeper reveal of overall response rates at the meeting and at our investor day in December.

We remain very encouraged by our Waldenstrom Program potential as we continue to see encouraging signals emerging across patient groups within the Phase Ib trial.

So as you can see we are very excited about the data, we've revealed so far, and about the expanding potential of mavorixafor and we're really looking forward to our presentations at ASH and for our investor event just following the meeting.

We'll be providing more details about the event in the coming weeks, but we currently expect it to be a two-hour virtual meeting on the morning of December 16th with participation from our expert clinical advisors. So please mark your calendars.

With that update I'll now turn it over to Adam, to discuss our results for the quarter before we open up the call for questions.

Adam?.

Thanks, Paula, and thanks to all of you on the call today. As presented in our press release this morning, I will summarize our financial results for the third quarter ended September 30th 2021. Research and development expenses were $13.2 million for the third quarter of 2021, as compared to $11.4 million for the comparable period in 2020.

General and administrative expenses were $5.9 million for the third quarter of 2021, as compared to $5.6 million for the comparable period in 2020. And we reported a net loss of $20.2 million for the third quarter of 2021 as compared to a net loss of $17.4 million in the third quarter of 2020.

Note that net losses include $1.5 million and $2.2 million of certain non-cash expenses for the quarters ended September 30th 2021 and 2020 respectively. We had $77.7 million in cash, cash equivalents and restricted cash as of September 30th 2021. We continue to expect that these funds will support our operations into the fourth quarter of 2022.

We did make some personnel announcements towards the end of the third quarter. We recently announced the appointment of Francoise de Craecker to the company's Board of Directors and the hiring of Karolyn Park to the newly created position of Vice President, U.S. Commercial.

These appointments significantly strengthen our depth and breadth of commercial leadership experience and expertise and the strategic marketing of rare disease therapeutics. In September, we announced the promotion of Dr.

Mary DiBiase to the newly created position of Chief Operating Officer, reflecting her longstanding contributions to the company and the advancement of mavorixafor into global late stage clinical development.

Mary has served as our Senior Vice President and previously Vice President of Technical Operations and Quality in addition to Vice President of Program and Alliance Management since joining the company in 2017. We'll now open up the call for your questions.

Operator?.

And thank you. [Operator Instructions] And our next question comes from Zegbeh Jallah from ROTH Capital..

Good morning. Thanks for taking my question. Congrats on the update and looking forward to the data at ASH and definitely the investor calls. I think I just have one general question here and it's just about the commercial outlook. I really like what you're doing regarding looking at expanded market opportunities.

We saw you did that for WHIM and now you are looking at SCN and clinics expanding that opportunity.

Can you just comment a little bit on how you're thinking just of the execution on that front more broadly? And then as it relates to WHIM specifically, I just wanted to get a sense of where you think you are in terms of finding the ideal or the true number of the patients and is this a process that you expect to continue to occur even after you launched a program to kind of find additional patients that may benefit from your therapy? And also nice to see that you did bring on a VP of Commercial, which again hints at the opportunity to really focus on the commercial side of things..

Hi, Zegbeh. Thanks so much for the question. I'll try to address the components. I think -- I mean, for people who understand the history of rare disease it's the well established story of when it comes -- when a product, especially an innovative product, where there's no treatment, first start, the number of patients identified grows exponentially.

Just using Genzyme as an example way back when the first product in Gaucher disease, I think at the time there were about 1,000 patients expecting to be prevalent in the world and today we know there's over 15,000 based on registry data. So it really is about education, awareness.

And WHIM syndrome, growing into chronic neutropenia is going to be that story as far as we believe. WHIM, we're learning more about the genetics, as you heard, of finding us a unique variant based on patients that are already known today is really indicative of our early understanding of a disease and how it's presenting clinically and genetically.

This is a huge step forward for the company in terms of really having profound conviction in our current estimates, which will grow overtime, just so, I hope, the story that we've shared about Genzyme. And then I think WHIM patients are a type of chronic neutropenia.

We're learning more and more that chronic neutropenia as a broader umbrella, regardless of genetic foundation is a high unmet need. Patients today are treated with injectible G-CSF multiple times a day or week. It's an inadequate treatment and we could completely revolutionize the therapeutic landscape with an oral once daily.

So there's a lot to grow here. We're at the start of our commercial journey and in great shape based on some of the data we've just released at ASH..

Thanks, Paula. .

And thank you. And our next question comes from Leland Gershell from Oppenheimer. Your line is now open..

Hey, good morning, Paula. Thank you for the update. Congrats on all the ASH acceptances. We’re looking forward to hearing more at the meeting. A question from me kind of touching off from the prior one.

I mean it seems like as we're learning more and more about mav and its -- the data that we're seeing in various clinical settings, it seems like there may be no limits in terms of the ability of the contents to be useful in a variety of conditions with neutropenia and with limitations on abilities of white cells to get out of the bone marrow.

As we look forward to your expansion in the chronic neutropenia setting, could you maybe relate to us just what the expanded scope of the trial may relate to in terms of the population that the trial -- types of patients in the trial would have corresponded to in terms of, let's say, the U.S. population with neutropenia? Thank you. .

Sure, thanks, Leland. So chronic neutropenia as a marketplace is not well understood, but we can certainly share what we know today and we've been modifying our trial to begin to address this.

So severe chronic neutropenia is treated as I mentioned with G-CSF and we feel pretty confident today there's at least 2000 patients on regular G-CSF dosing for their neutropenias. That is likely a profound underrepresentation of the patients that need it because of the challenges that both G-CSF and the limitations of the label.

So we think that's the beach head. We think that's broader kind of, broader than that. We do have ongoing market research there and we'll be able to present some of that in 2022. But certainly we think there's a lot of unmet need unfortunately.

These patients are not treated well with -- and only have a single option so an oral once daily again could dramatically alter the treatment landscape and market potentials for these patients who are somewhat forgotten. .

All right. Great. Look forward to the hearing for the next month thank you. .

Thank you. .

Thank you. And our next question comes from Marc Frahm from Cowen & Company. Your line is now open. .

Hey, thanks for taking my questions and congrats on all of the updates. And Paula in your comments you mentioned you know kind of triangulating the prevalence of WHIM patients with the D84H mutation that you -- that you've identified.

I guess have you had a chance beyond the case study to go look at some more medical records to inform that 5% to 10% penetrance number that you -- that you were putting out there, or maybe can you talk about the broader context of penetrance just why that's an appropriately conservative number? I -- obviously as a headline 5% to 10% doesn't seem very high.

.

Yes this is the hardest assumption for any new disease area to make as you're going from genetics -- genotype to phenotype. So we have looked at a broad range of other rare diseases. But you can appreciate this is very much -- I think every gene is a snowflake story where there are unique profiles to mutations.

But I think our approach here was really being conservative with the 5% to 10%. We've seen numbers actually quite north of that in terms of conversions from genotype to phenotype that we want to be I think appropriately cut -- understanding that the true prevalence until we start building on it.

And I think today we feel very good about what we're seeing with those of our patients that we're identifying as around that number. So it's a tricky one Mark thanks for highlighting it. I think that's where we're starting today. .

Okay that -- that's helpful, thanks. And then just on Waldenstroms I would say a huge update in terms of data cut off for the abstract versus the last presentation. But this is the first time that you've included some response data not just the IgM levels.

Can you just remind us that -- I think there's some flexibility in the trial as to when patients who require scans for their response assessment when those scans happen.

And can you put in context the response data that's in there? When those scans were taken? How many patients actually needed scans for response assessment? When those scans happened? And then maybe into the broader context of the time course of response that's seen with ibrutinib monotherapy?.

Yes so I'll ask Diego to take that. Big picture Mark at the end of the day it's about the kinetics of response I think is what you're saying. And again I'll turn it over to Diego to provide some more context about our data. .

Yes Thank you, Paula. And Mark so the protocol originally was designed to assess a response starting at six months and then every six months. In part because you have to do a whole-body CT scans which is radiation and bone marrow biopsies. We have amended the protocol to make that now more frequent every three months.

I would say this update mostly was like the six-month data. Which is the first look into clinical response. Different studies do different ways but we felt that that it was important to try to get more frequent assessments. And that's why we amended. .

Okay, thanks. That's helpful. .

Thank you. And our next question comes from Stephen Willey from Stifel. Your line is now open. .

Yes. Good morning thanks for taking the questions. Maybe just following up on Waldenstroms. Again understanding that the abstract cut is largely representative of what we saw at EHA.

But can you speak a little bit to maybe just where patients are in terms of dose escalation in this trial? Specifically with respect to the 600 mg dose? I know that there was an intention to initiate dosing maybe in cohort C at 600 mgs without that step up.

Can you maybe just speak to where you are on the on the dose-escalation side?.

Sure.

Diego would you like to take that?.

Yes, sure Stephen. Yes, so we have previously communicated of course that we have cleared the 200-milligram dose on the 400-milligram dose. We are already dosing at 600-milligrams and make much progress. And we plan to report some of that data both at -- in the poster as well as in the investor day.

So yes that's a focus of us to complete that enrollment. And just to remind you once the -- if the 600 milligram dose clears in cohort B then everybody else can be escalated to 600 including those in cohort A and all those enrolled in cohort C. .

Okay. And then just on I guess the chronic Neutropenia or Severe Congenital Neutropenia. I know these patients don't have CXCR4 mutations. But I think the intention of this program was to try to maybe correlate patient responses with some kind of genetic signature.

And just wondering how far along into that interrogation of that correlation will you be at time of ASH? And I guess, how much more work do you need to do in order to be able to maybe refine that patient population for responders?.

Yes so I'll make one comment and then I'm going to invite Art to talk a little bit more about mechanism because I think it's really indicative of market potential. But -- so we certainly have always been trying to help patients and physicians better understand the genetic drivers of their disease.

But as we just released in our ASH abstract, we have seen the mavorixafor broadly, regardless of mutation status, creating these multiple-fold increases in white blood cells including neutrophils and lymphocytes. So there's a huge sort of swath of patients that have the low neutrophil counts and low lymphocyte counts that this drug could address.

And then mechanistically it makes a lot of sense. I'll invite Art in to talk about the mechanism of G-CSF, which is standard of care and how mavorixafor really nicely synergizes and could potentially supplement or eventually replace that.

So Art, could you chime in?.

Sure. Thank you, Paula. And hi, Steve. So when we first got started with SCN we actually understood this as a different – or a collection of different mutations that did not really include CXCR4. So the question was exactly yours is whether or not mavorixafor could have any kind of benefit.

And we would think that it would be connected ultimately to CXCR4 upregulation. And so as we started to go through and look at all the mutations that are known that actually do trigger some kind of neutropenia and congenital and severe congenital neutropenia or chronic neutropenia, what we find is that so many of them have upregulated CXCR4.

And so for us that seems to be the premise of the mechanism that when you have an upregulated CXCR4 which is the underlying principle behind a lot of chronic neutropenias then mavorixafor would be essentially blocking the adhesion. And then you can have a benefit. So that's the underlying mechanism.

And it seems to correlate as well with G-CSF administration. So G-CSF as you know downregulates the CXCL12/CXCR4 axis. And that gives you an increase in neutrophils in periphery. So CXCR4 antagonism is actually part of that mechanism. So it actually very much aligns with the approach that we're trying to do.

And we do expect that we're going to have benefit there in a number of patients that have nothing to do with CXCR4 mutation..

Okay very interesting. Thanks for taking my questions. .

Thank you. And our next question comes from Mayank Mamtani from B. Riley Securities. Your line is now open. .

Hi, good morning this Sarah [ph] on for Mayank. Thanks for taking our questions. Several of them have been answered so maybe just a few quick ones.

In terms of the structure of the data release how do you anticipate disclosing from the SCN and now broader Neutropenia program as well as the top line data release from the WHIM program is that going to look similar to the Phase 2.

And then maybe more on the commercial side could you just talk to kind of how there might be an overlap between the commercial prep for WHIM and future Neutropenia indications any synergies that you guys are seeing on that end. Thank you. .

Sure. So I think I heard sort of three or four elements to the question.

So around the SCN data we will be presenting that data in a context of some of the white blood cell and chronic administration of mavorixafor data that we've garnered over several trials so that will be included in our poster and we'll share more insights in our Investor Day on the 16th.

In terms I think you said the WHIM Phase 3 that certainly top line data expected in about a year. The primary endpoint as a reminder to everyone at another threshold for neutrophil counts and we had a 600% increase in the Phase 2. So that will be kind of the unveil will be in a year from now when the trial's completed.

And then how we're thinking in totality about building the market – just addressing the market of unmet need around chronic Neotropenias including WHIM we see WHIM as the landmark study to begin to build on a highly targeted population of which you heard is growing from a genetic WHIM type perspective And then laying on this additional patient population that's not necessarily genetically linked but mechanistically linked, as we know through the benefits of G-CSF.

Again G-CSF is a life-line injectable product sometimes multiple times a day for some of these patients and we think we can just revolutionize that entire field with an oral once-daily starting with WHIM and then expanding to the Neutropenias beyond it.

So the market – a footprint commercially are they are treated by the same doctors that's very nicely leveraged on an infrastructure perspective and from a patient communities perspective we're learning across all types of Neutropenias so there's a tremendous amount of connectivity and leverage across the key touch points that we need to be long-term successful as an organization.

.

Awesome, that's really helpful. Congrats on the progress. .

Thank you. .

Thank you. And I am showing no further questions. I would now like to turn the call back over to Paula Ragan for closing remarks. .

Well, thank you again for joining us today. We look forward to seeing many of you at the various upcoming investor conferences and sharing more of our scientific and clinical data in December. If you have any further questions, please don't hesitate to reach out. Thank you again and enjoy the rest of your day..

This concludes today's conference call. Thank you for participating. You may now disconnect..