Adaptimmune Therapeutics plc (NASDAQ:ADAP) Q1 2023 Earnings Call Transcript May 12, 2023

Adaptimmune Therapeutics plc beats earnings expectations. Reported EPS is $0.01, expectations were $-0.14.

Operator: Hello. Welcome to Adaptimmune’s First Quarter Call and Business Update. I would now like to turn the call over to Juli Miller. Juli, please go ahead.

Juli Miller: Good morning, and welcome to Adaptimmune’s conference call to discuss our first quarter 2023 financial results and business updates. I would ask you to review the full text of our forward-looking statements from this morning’s press release. We anticipate making projections during this call, and actual results could differ materially due to several factors, including those outlined in our latest filings with the SEC. Adrian Rawcliffe, our Chief Executive Officer, is here with me for the prepared portion of the call. Other members of our management team will be available for Q&A. With that, I’ll turn it over to Adrian Rawcliffe. Ad?

Adrian Rawcliffe: Thank you, Juli, and thanks to everyone for joining the call. My comments today will be brief, and we can go directly to questions. We started 2023 at pace, and it promises to be a year of change for Adaptimmune. We completed the prioritization and restructuring in Q1, cutting costs whilst remaining focused on our priorities with afami-cel BLA, the CD8 program in ovarian, bladder and head and neck cancers, PRAME and our allogeneic platform, a strong pipeline of cell therapies for a wide range of solid tumors. Adding to that strength, we announced that we entered into a strategic combination with TCR2. We have two companies that have spent our entire histories focused on solid tumors with experienced teams, with advanced strong clinical pipelines, with significant value-creating near-term catalyst.

Add to that, the compatibility of our technology platforms, including an innovative next-generation toolbox and a cash runway into 2026. And taken together, it’s clear that this combination will create a preeminent cell therapy company to treat solid tumors. We expect the transaction to close in Q2 2023, subject, of course, to shareholder approval at the end of this month. Both companies are very actively planning for integration, and we will update further once the transaction is closed. We are also on track to have a commercial product afami-cel, which would be the first engineered T-cell product on the market for a treatment of a solid tumor. We announced that we have completed Part 2 of the BLA submission in Q1, and Part 3 is in progress for completion in mid-2023.

Afami-cel is an incredibly exciting drug. And the need for new marketed treatments for synovial sarcoma, compelling. Recently, we had the privilege of hosting a young woman, who is surviving synovial sarcoma at an internal meeting. Hearing her personal account of misdiagnosis, harsh treatment and are pleased for new and innovative therapies with inspiration for all of us here and highlights further how important afami-cel is for this patient population. She also described the loss of young lives from this cancer and the experiences of her peers in the sarcoma community. We hope to share stories like her in the future and continue to raise awareness for synovial sarcoma and high unmet need in this cancer. Continuing with the afami-cel news, we will present updated overall survival analysis for afami-cel in June at ASCO.

It’s clear that this is a powerful treatment for this rare and deadly cancer. Beyond afami-cel, we remain focused on developing our MAGE-A4 franchise with our next-gen CD8 therapy and progressing more products to market. To that end, we are initiating the Phase II SURPASS-3 trial in combination with nivolumab for platinum-resistant ovarian cancer. This trial has the potential to become registrational and is supported by RMAT designation with the FDA. We are also initiating additional cohorts in the Phase I SURPASS trial in combination with pembrolizumab to treat patients in earlier-line settings for head and neck and urothelial cancer. Last year, we announced we have PRAME back from GSK, and we believe this is another powerful target for solid tumors, with increasing validation across the industry.

We are progressing PRAME to be IND-ready by the end of this year and plan to initiate trials next year. We also announced in Q1 that we are in the process of transitioning lete-cel back, and we will receive approximately $37 million from GSK in relation to the transition of the ongoing clinical trial. We anticipate lete-cel data in synovial sarcoma and MRCLS later this year. And we’ll evaluate this opportunity accordingly. In closing, this has been a significant first quarter for us and will undoubtedly prove to be a year of change as we move towards our first BLA and marketed product. Behind that, we have an unparalleled pipeline of cell therapies for solid tumors, and we’ll continue to prioritize development in a thoughtful, data-driven fashion.

I look forward to reporting out of future progress. And with that, I’ll turn the call over to Q&A. Operator?

Q&A Session

Operator: Thank you [Operator Instructions] Our first question comes from Marc Frahm of TD Cowen. Please go ahead.

Operator: Our next question comes from Tony Butler of EF Hutton. Please go ahead.

Operator: Our next question comes from Mara Goldstein of Mizuho. Please go ahead.

Operator: Our next question comes from Michael Schmidt of Guggenheim. Please go ahead.

Operator: Our next question comes from Jonathan Chang of SVB Securities. Please go ahead.

Operator: Our next question comes from Peter Lawson of Barclays. Please go ahead.

Operator: This concludes the question-and-answer session. I would like to turn the conference back over to Adrian Rawcliffe for any closing remarks.

Adrian Rawcliffe: Thanks, everyone, for your time today. We’ve been very pleased to share our progress with you, and we look forward to updating later on in 2023 after we have concluded our transaction with TCR2. In the meantime, please feel free to reach out with any questions. Thank you again for your time. Bye.

Operator: This concludes today’s conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.