Conference Transcript - ANAB 2026-03-10

Esther DeRoot, Analyst — Barclays

Hello again, everyone. Esther DeRoot, Senior BioNTech Analyst at Barclays. My pleasure to have Anaptis Bio CEO Dan Fager with us this morning. And maybe just to kick us off, Dan, if you could just give us an overview of Anaptis Bio for those less familiar with the story.

Daniel Faga, CEO

We are in exciting times right now. We're approximately a month or two out from creating a second company called First Tracks Bio. which will be the biopharma operations for Monaptis that we're spitting off. Naptis has been around for over 20 years, developing antibodies. We have two successful programs so far out of our platform. One, Jemperly, Starlomab, which is being sold by GSK. It's an oncology drug, a PD-1 antagonist. And the second has a Pitufa Day at the end of the year. It's called Hemsidolomab for GPPs, which hopefully will be sold at the end of this year by a company called Vanda. Those two programs will stay behind, forming a royalty-based financial company that will retain the name Anaptis Bio. In the biofarm business, we have a couple of exciting programs. One is AMB033, a CD122 antagonist. It's being developed in celiac disease as well as EOE, Phase 1B. We have Rosnolamab, which is a PD-1 depleter. We have positive Phase 2B data in arthritis. This past year, currently, we are assessing how best to move that program forward into Phase 3. We're meeting with the FDA this quarter, and we'll be looking for strategic or other financial capital to further finance the program with an update in the second quarter. And last, we have AMB 101, which is a BDCA2 modulator in Phase 1A. There's a proxy program being developed by Biogen, which is in Phase 3, and SLE and CLE. I think we have best-in-class programs across all three, those antibodies. So excited to get that second company up and running in the next month.

Esther DeRoot, Analyst — Barclays

And I think, you know, we've sort of heard both sides of the debate about sort of separating a company where, you know, whether you have the ability to self-fund or be able to kind of unlock value, if you will, for the two individual entities. Maybe just go over sort of the rationale for now being the right time to be able to separate those two businesses.

Daniel Faga, CEO

Yeah, I think we've had a great response from the separation. We have two very different – well, we will have two very different businesses in the end. One is a financial instrument that, again, with what we're leaving behind at NAPDIS, This will be very high EBIT margin in the mid-high 90% range, less than 10 FTEs or contractors, less than 10 million OPEX a year. And on the top line with the royalties, with the lead program with Jemperly out of GSK, last year Jemperly did on a run rate coming into this calendar year, $1.4 billion of revenue translated into approximately $100 million of royalties for us. And that is a very fast-growing mid-teens, quarter-over-quarter growth asset. So that's getting very big quickly just from the monotherapy development that's ongoing there and the approval already into mutual cancer. So that's a really exciting and very different type of investor that's looking for profitability and high EBIT profile. It's really a proxy of the high-growth vertical at GSK, which overall is a neutral, growing big pharma. So very different and unique in what we're creating relative to the biofarm business, which is pretty typical in terms of the shape and size. When we split out, almost every employee will be transferred over to the new business. Our labs will be transferred over along with the assets. And we will fund that company off our balance sheet, out of the gate. will have cash through milestones being driven by celiac and AOE disease into next year, minimally.

Esther DeRoot, Analyst — Barclays

Got it. And, you know, you talked about sort of, you know, allocating capital obviously across the pipelines for First Track Therapeutics. I'm assuming A&B at 033 is going to sort of take the bulk of that and maybe kind of talk through sort of how you're thinking about capital allocation in your business.

Daniel Faga, CEO

Yeah, so we hit $310 million coming into the year. approximately $10 a share on anathesis share counts. So a large portion of that will move into the biopharm business. As I was saying earlier, the anathesis company on an omex basis, it does not need a lot of cash to get through cash flow positivity. It'll be gap positive right out of the gate, but we project cash flow positive when we pay down non-recourse debt with Cigari, which we expect to be into mid-2027. So it doesn't need a lot of cash. The biopharm business does need capital. More specifically, $100 million will put us into Q3 of 2027. $200 million will put us into the back half of 2028 fully funded, which is dominantly A&B 033. We have a choice to make, which we'll make over the next month of where within that range off the balance sheet we look to capitalize. Any capital that we do not put into first tracks or remain behind will be available for return of capital to shareholders and out-of-the-gate potential things like share buybacks.

Esther DeRoot, Analyst — Barclays

Got it. Maybe shift gears to A&B 033, obviously a product candidate that you're excited about. First, maybe the design strategy for celiac disease, which we'll have, obviously, an update in the second half of this year, how it's sort of different from what others have done, and we'll just take it from there.

Daniel Faga, CEO

Yeah. So AMB033, like I mentioned, is a CD122 antagonist. It blocks the signaling of IL-2 and IL-15, which are two pathways that target inflammation within celiac disease. So gluten is digested, the byproduct. Gliadine is picked up. It's the antigen in this disease. It's picked up by APCs that are then presented to Th1 CD4 cells. You see a release of IL-2 and instigates the inflammatory cycle. So we're hitting that pathway direct by blocking the activation and proliferation of CD4 T cells. We're also blocking IELs, which are very similar to phenotype and CD8s, and they survive off of IL-15. So by blocking that signaling, you see a reduction in IELs. So we're hitting both sides of it. In order to test the hypothesis, we've taken a very creative design of phase 1B. It's traditional to see patients who are very well controlled that have celiac disease treated with a gluten challenge or targeted with a gluten challenge. So you're inducing damage or mucosal injury in patients who don't see it otherwise. We measure that via histology look of the destruction of the villi measured by VHCD, villus height to crypt depth ratio. So these patients start with a higher VHCD. We're giving them drug versus placebo, one-to-one randomization at subcutaneous, at baseline, week zero, week two, week four. Then for 14 days, they're ingesting gluten. So now it's week six. We're doing a scope. If you take in the placebo, the gluten will induce that damage. You should see a deterioration of VHCD. On drug, you'll see something more neutralized in terms of the impact, And we're looking for statistically significant difference between placebo and drug at week six on those biopsy results relative to baseline. The second thing we're looking at is severity and frequency increase of symptoms for patients that were on placebo relative to drugs. We're looking to prevent symptoms. So this trial design is relatively standard. You see it typically with all celiac drugs in phase 1b. The second cohort that we're assessing is patients who show up thinking they're well-controlled but via the biopsy results or finding that their VHCD is less than or equal to 2, meaning that their villi is showing signs of mucosal injury. It would be unethical to give them gluten. Instead in this cohort, so one-to-one randomization again versus placebo, giving subcutaneous drug at baseline week two and week four. But instead of administering gluten, we're waiting. We're waiting until week 12, so eight weeks later off drug, to assess if there's been healing. So is there improvement on VHCD on drug relative to placebo? This patient population is more representative of the commercially viable population for patients with celiac disease. The difference here, these patients are have mild symptoms whereas in a phase 2b you would be assessing patients with mild moderate and severe patients but it's a good proxy to show that we're driving at targeting the inflammatory pathways and inducing improvement via the histology assessment in this population our in this cohort we are not expecting or putting a prerequisite for ourselves that we need to see statistically significant results for placebo. It's exploratory. We're looking for a numerical trend on VHCD. No one's done this before with this cohort, but it's an exceptional additional piece of information that we will have to then go off and design a more robust phase 2b that should be further de-risked than we would typically see from just a gluten

Esther DeRoot, Analyst — Barclays

challenge in the information there. Got it. And with that information from the two cohorts, what would the phase two look like? Would you sort of design maybe two separate trials? Would you ultimately find sort of some way to kind of measure and include sort of both cohorts of patients in a phase two B? How would you think about that?

Daniel Faga, CEO

Yeah, so there is draft FDA guidance on the primary endpoints, and I've now spoken to both of them. You need a histology outcome, which VHCD would, the ratio there and the change of ratio there would qualify, and you need a PRO. The PIRA that we're assessing is the Celiac Disease Symptom Diary. It measures frequency and severity of symptoms over time. So again, statistically significant results in the Phase I being the Gluten Challenge on both of those that we're assessing. In the second cohort, we're looking at only VHCD numerical score. We're also capturing symptoms, but I'm not sure what we're going to see since patients present feeling better controlled than the typical population. So we know what the primary endpoints would be. The difference is we have a three-month trial in that second cohort. We'd be looking more at six-month, one-year long plus endpoints. In a much larger trial, we'll probably look at multiple doses. We're looking at one dose in the Phase I. And it's to be determined how Phase IIb into Phase III looks like. But we'll generate the data this year. We should have results from the Phase Ib and Q4 of this year. And then we'll go speak with the FDA on how to move forward in the fastest way possible.

Esther DeRoot, Analyst — Barclays

And sort of on sort of the competitive landscape, one, and sort of you've had data from competitors, I think that ultimately gave people more confidence around the mechanism, but then inevitably the question around differentiation will come up. So how are you thinking about sort of the competitive landscape here for A and B 033 relative to what we've seen from others?

Daniel Faga, CEO

Yeah, so I think there's encouraging signals that targeting one or both these inflammatory pathways can drive meaningful results for patients. There's three other programs that are in the IL-15 C2122 pathway right now that have proof of concept in celiac disease specifically. TEV and Novartis have IL-15 blockers. That's only going to hit one side of the two inflammatory pathways in this disease. And there is another C2122 program that had positive trending phase 1B results. The TEVA program should have data from their Phase 2a as a gluten challenge later this year as well as the CD122 competitor with Phase 2a gluten challenge data later this year. So again the distinction here is the gluten challenge will be read-throughs not just from the 1b data that exists from these competitors but also from Phase 2a which will be longer tenured trials beyond three months, but also only in gluten challenge. So I think we'll be generating something very different with that second cohort. I described earlier how the mechanism of action at a high level works with the CD122 antagonists. We have a subcutaneous format that is very potent. It's based off the combination of the affinity and the epitope of which would bind onto the CD122, which on CD8 and CD4 cells, the way this works is there's a dimeric or trimeric receptor, you're targeting one of those receptors, but based on where we are in the epitope, we think we have distinguished signal blocking of IL-2, which is really bound to directly to CD25, which is part of that trimeric receptor on CD4 cells. So there's differences between the drugs, we think we potentially have something that's more potent. And like I said, the administration profile is differentiated. So excited about what we have. I think when you look on paper in a year, we're all more or less on the same place in celiac disease and development timelines. However, we have that additional information from that second cohort, which I think gives us a distinct advantage as we think about moving

Esther DeRoot, Analyst — Barclays

and de-risking phase 2b. Great. And obviously, celiac disease is just at the tip of the iceberg here with A&B 033. If you can maybe talk to EOE, the opportunity there, and then sort of, you know,

Daniel Faga, CEO

what we can expect next from that program. Yeah, so we're excited about the second trial. It's just initiating EOE right now. We'll have data in 2027, 50 patient trial, one-to-one randomization, and we're looking at, again, two distinct endpoints that we are powered for, which are also the co-primer endpoints in phase 2b, phase 3 trials in this disease. There's a histology look. It's really actually measuring a cell type that gets infiltrated in this disease called eosinophils. We're looking to target the inflammatory pathways and block eosinophils from being recruited into an inflammatory environment. The second is our PRO. This one is called DSQ, we're powered to assess statistical significance versus placebo on both of those endpoints. EOE is, it's different than celiac in that we're going to be able to show in this trial that we're targeting Th2 CD4 cells as well as ILC2s. And the reason I bring this up, that's one side of the inflammatory cascade. This is the side that Dupixent targets, which is the only approved therapeutic in EOE. We've shown pre-clinically through an Aspergill's eosinophil-induced model the reduction or prevention of TH2 proliferation and ILC2 increases. We've shown this on the cell types as well as other biomarkers that you would tend to see. What's important about that is just by targeting that pathway as well as CD8s, we are upstream from those eosinophils and we're preventing their increase. We don't target them directly. And I think that's one of the key differences, and it's one of the key differences with Tupixin, which is the only other drug that's shown to be effective in this disease, is that drugs that have targeted eosinophils directly downstream or other proxies of that, you might be able to prevent eosinophil in flux, but you're not actually treating the inflammatory pathways of the disease. So there has been failure in this space, but we're taking a very different approach by hitting the Th2-ILC2 side as well as the CD8 side. There is proof of concept here. So Novars' IL-15, the precursor company that they acquired, Calypso, did run a small EOE phase 1B, again, just targeting CD8 cells, again, not eosinophils, upstream. In that study, they showed a prevention of eosinophil recruitment and a reduction or prevention of symptoms getting worse by treating that disease. So there's a proof-of-consult surrogate in humans from treating just that one side of the pathway. We're doing both with a CD122 antagonist. The opportunity here is Depixin is only effective or modestly effective in 60% plus of patients. The other 30% plus, you do see an increase in IL-15. So we actually think we have a potential solution here for all patients, and we will be recruiting patients who are both depiction-experienced and depiction-naive. So excited about the other opportunity here, different than celiac, and if we're successful, it will open up the pathway to many other diseases. This landscape has, across the competitors I've already mentioned, there are folks focused in atopic dermatitis, vitiligo, alopecia, have us talking about EOE as well as a potential additional indication. So a number of places that folks already are playing, plus expansion opportunities for us or maybe others in the future, a lot of data coming out across the landscape over the next 12 months in celiac disease and the other diseases I mentioned.

Esther DeRoot, Analyst — Barclays

Yeah, and then actually to that point, I guess we'll see because the devil's in the details, but one of the competitors is vitiligo data that does have alopecia data sometime in 2026. Does failure read through and those specific indications read through to ANB033's mechanisms, given sort of the differentiation there, or do we still see sort of a viable opportunity because of what you've seen preclinically for those other indications?

Daniel Faga, CEO

Yeah, like I mentioned very specifically, there's human proof of concept that's positive in celiac disease. I think these are all different diseases. We are not running a trial in vitiligo. We're going to wait and watch and look at the results. I think there's a very good thesis for targeting CD8 cells that are present in the setting of vitiligo. It could be a great target for just an IL-15 that doesn't have the power of blocking IL-2 as well, and the IL-15 signaling on multiple different types of cells. So we're looking at those results, obviously. Vitiligo is a potential third, fourth, fifth indication for us. And if we see success in the field, once we get our own data in the Tuesdays that we're focused on, then there's a big opportunity to expand in other Phase II diseases, and it could include markets like the LIGO.

Esther DeRoot, Analyst — Barclays

And I think you've sort of been a passion for sort of diseases like type 1 diabetes as well as a potential opportunity. Just quickly, the rationale there, just sort of given the size of that opportunity relative to, you know, all, I guess, the other indications that that could certainly be attractive.

Daniel Faga, CEO

Yeah, so we haven't, we have not said publicly that it's a disease that we're looking at, you know, explicitly. It's one of the target diseases that is rational given the influx of CD8 cells and the impact it makes on these foot-producing cells in the disease. So I think, like, it's another thing that we will be assessing through the course of this year into next year, but I'm not going to get into more details. I don't want to sit here and speculate right now on which diseases we'll be pursuing, but there are multiple options for us for third, fourth, and fifth. And I mentioned different capital needs for the company. The $200 million that brings us in the back half of 2028, that does include expansion to at least a third or fourth indication beyond moving celiac and EOE into phase two.

Esther DeRoot, Analyst — Barclays

Got it. Great. Right. And then sort of back to the royalty business for a couple of questions. You know, obviously, Jim Pearlie, you know, significant grower for that business. You know, Vanda could come online with their royalty stream by the end of the year. Other revenue opportunities that you see or consider that could be sort of valuable for shareholders from that business?

Daniel Faga, CEO

Yeah, so specifically the business model here, and you can tell by the the minimus infrastructure we're looking at putting is to protect and return the value from the royalties we already have from the Anaptis platform. We're not looking to expand and with other drugs. That said, Gemperly is growing in the mid-teens quarter over quarter off that 1.4 billion dollar run rate. GSK is guided to far north of 2 billion pounds, which is 2.7 billion dollars. We believe that that's achievable as early as 2029, which results in close to $400 million of royalties given the royalty stack here goes from 8% to 12% to 20% to 25% through all those tiers under that target number set by GSK. And it's important to note that GSK is on record from now multiple years ago and has repeated over time just success in endometrial cancer, which is where they're currently approved, with an overall survival data package that's differentiated from Contruda, which does not have overall survival data. And the second indication is rectal cancer, which they have announced later this year. There will be pivotal results available as a proxy for that. In phase two, they showed a 100% ORR, which is unprecedented. So we're excited and have high expectations there. Those two diseases alone, GSK has said, would get to those peak sales numbers of $2.7 billion. We should also see data on the primary completion in a phase two trial in MMRP colon cancer is scheduled to be this year. There's two additional pivotal trials going on in DMR colon, where there's phase two proof of concept, and had neck cancer where there's proxy read-throughs from Contruda. What's interesting here, and you think about the growth over time, is we have at least a decade to go of composition of matter in the U.S., then a year later in Europe and into 2037 in Japan. So there's a lot of IP left within the program. GSK on a monotherapy basis is competing in spaces where Contruda doesn't have data or is not being developed. So we feel very well protected here when you look over the horizon relative to what's going to be going on with the Contruda franchise. with Merck. So I think in the short term there will continue to be a lot of growth for monotherapy development, but in the mid to long term there's a huge, huge opportunity. It's just this year it's gone from the 20th largest drug in the company. This year it's projected by consensus to be the sixth largest. Consensus is really shown to be laggard here, backwards looking. About a third of the analysts are showing negative growth this quarter. So it's not a good proxy for value, But it does give a good reference point of just how important this drug is to GSK's overall business. It's the largest oncology program in the company, but it's the fastest-growing drug, over a billion dollars of sales times three. So really important in the future of GSK's franchise, which gives us a lot of confidence here to anchor the royalty business around the Gemperly royalty. And like I mentioned earlier, Vanda has a Pidufa December 12th looking for approval in GPP, generalized pustular psoriasis. It's a best-in-class IL-36 receptor antagonist. So we should exit this year with two commercial-stage royalties.

Esther DeRoot, Analyst — Barclays

So we're up on our time. Ben, thank you so much for your time this morning, and thank you for our listeners, and we'll be back for our next session.

Daniel Faga, CEO

Thanks, everyone.