Greetings. Welcome to Corvus Pharmaceuticals Fourth Quarter 2021 Earnings Conference Call. Please note, this conference is being recorded. I will now turn the conference over to Zack Kubow of Real Chemistry. Thank you. You may begin.

Thank you, operator, and good afternoon, everyone. Thanks for joining us for the Corvus Pharmaceuticals fourth quarter 2021 business update and financial results conference call. On the call to discuss the results and business updates are Richard Miller, Chief Executive Officer; and Leiv Lea, Chief Financial Officer. The executive team will open the call with some prepared remarks followed by a question-and-answer period. I would like to remind everyone that comments made by management today and answers to questions will include forward-looking statements. Forward-looking statements are based on estimates and assumptions as of today and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied by those statements, including the risks and uncertainties described in Corvus’ Annual Report on Form 10-K, which was filed today with the SEC and other filings the company makes with the SEC from time to time. The company undertakes no obligation to publicly update or revise any forward-looking statements, except as required by law. With that, I’d like to turn the call over to Leiv Lea. Leiv?

Thank you, Zack. I will begin with a quick overview of our fourth quarter and full year 2021 financials and then turn the call over to Richard for a business update. At December 31, 2021, Corvus had cash, cash equivalents and marketable securities totaling $69.5 million as compared to $44.3 million at December 31, 2020. Research and development expenses in the fourth quarter of 2021 totaled $4.8 million compared to $7.2 million for the same period in 2020. The decrease of $2.4 million was primarily due to a decrease in clinical trial and personnel costs. R&D expenses for the full year 2021 totaled $29.1 million, compared to $31.8 million for the full year 2020. The net loss for the fourth quarter 2021 was $9.2 million, compared to net income of $27.3 million for the same period in 2020. Net income in the fourth quarter 2020 included a non-cash net benefit of $37.2 million from the establishment of Angel Pharmaceuticals, which we co-founded in October 2020. Excluding this item, the net loss would have been $9.9 million. The net loss for the full year 2021 was $43.2 million, compared to a net loss of $6 million for the full year 2020, which also included the non-cash benefit from the establishment of Angel Pharmaceuticals. Total stock compensation expense for the fourth quarter and full year 2021 was $0.7 million and $4.2 million, respectively, compared to $1.2 million and $5.7 million for the same periods of 2020. Looking forward, we expect full year 2022 net cash used in operating activities to be between $34 million and $36 million. I will now turn the call over to Richard.

Thank you, Leiv, and good afternoon, everyone. Thank you for joining us today for our fourth quarter and full year 2021 business update. In 2021, we advanced our programs and the laboratory and clinical data we generated has enabled us to identify opportunities for our product candidates that we believe could represent important new therapeutic approaches to several types of cancers. We enter 2022 with three clinical programs focused on targets of high interest that we plan to advance into patients in earlier lines of therapy and into mid to later stage clinical trials. I will now elaborate further on each of our pipeline opportunities and plans. As you know, there is now heightened interest in antibodies targeting CD73, following the recent data from AstraZeneca in Stage 3 lung cancer that demonstrated a benefit of adding their anti-CD73 oleclumab to durvalumab, an anti-PD-L1 antibody. More recently, in February, AZ announced data from the Neo Coast trial, a randomized Phase 2 neoadjuvant trial in lung cancer that confirmed the benefit of adding oleclumab to durvalumab. There are now several companies pursuing development of anti-CD73 agents for cancer and other diseases. We believe we have a very differentiated antibody demonstrated by the substantial laboratory and clinical data behind it. We also have discovered key biologic properties of the CD73 target that are helping us develop and expand clinical opportunities, not only in cancer, but other diseases as well. Briefly, the key differentiators for mupadolimab include, first, it binds to CD73 with picomolar affinity and completely blocks adenosine production. Secondly, its binding to CD73 is concentration dependent and plateaus without a hook effect. Thirdly, its binding does not cause antigen internalization; there’s no loss of antigen. Fourthly, it binds to a unique epitope on the CD73 protein and this has now been confirmed by Cryo electron microscopy studies, which enabled us to determine the molecular structure at atomic resolution. Fifth, most importantly, its binding to B cells results in their activation and differentiating into antibody-producing plasma cells and into memory B cells. This property is not dependent on adenosine, and I want to repeat that, this property is not dependent on adenosine. Our results demonstrating B cell activation and differentiation have been presented at meetings and published. Several recently published papers by others are confirming the importance of B cells in the tumor microenvironment. Briefly, the presence of B cells and plasma cells confers a favorable prognosis and is predictive of response to immuno-oncology agents. Lastly, in clinical trials involving over 100 patients, we have determined safety, dosing, PK-PD, and immunologic effects. We have reported early signs of anti-tumor activity in lung cancer and other tumors. The data have led us to a therapeutic approach of combining mupadolimab, which serves to drive immune responses, with checkpoint blockade to release the brakes on the immune system. Together, we believe these complementary therapies may improve the immunotherapy of cancer. This is now being tested in ongoing Phase 1b/2 trials in advanced refractory lung and head and neck cancers. We anticipate presenting data from these cohorts in the second half of 2022. To build on this, we plan to initiate a randomized blinded Phase 2 study in the frontline treatment of patients with Stage 4 non-small cell lung cancer. Approximately 150 patients will be randomized to therapy with mupadolimab, in combination with pembrolizumab and chemotherapy, or to therapy with pembrolizumab and chemotherapy alone, which are approved standard of care therapies for this indication. The primary endpoint will be progression-free survival, and secondary endpoints include response rates and overall survival. Chemotherapy and pembrolizumab are approved for Stage 4 lung cancer, regardless of PDL1 expression on the tumor. Therefore, a very high proportion of patients with Stage 4 lung cancer are eligible for this trial. We anticipate that we can start this trial in the third quarter of 2022. Let me now discuss CPI-818, our ITK inhibitor. ITK is a homologue of BTK and is involved in T cell activation and T cell proliferation. As you may know, BTK inhibitors are now widely used in the treatment of B cell lymphomas. Several members of the Corvus team played crucial roles in the discovery and development of ibrutinib, the first BTK inhibitor. The idea here is that CPI-818, which is a small molecule orally administered drug, will block malignant T cell proliferation and be useful in T cell lymphomas, and perhaps in autoimmunity and allergy by blocking the proliferation or activation of T cells involved in these diseases. At the ASH meeting, American Society of Hematology meeting in December 2020, we presented data on patients with peripheral T cell lymphoma, or PTCL, treated with CPI-818. We observed one complete response and one partial response out of seven patients with very advanced refractory PTCL. I might add that the complete response lasted 19 months. Additional laboratory studies demonstrated that CPI-818 is having notable effects on lymphocyte populations and functions. Our partner in China, Angel Pharmaceuticals, has licensed CPI-818 for the greater China territory, and we are working with them to conduct expanded clinical trials in China and in the U.S. and other countries. A key motivation here is that T cell lymphomas are more common in Asia than in North America and Europe. Angel is now enrolling patients in a Phase 1/1b trial of CPI-818. I am happy to report that the initial anti-tumor activity we reported on at ASH has been confirmed in the Angel clinical trial. I will also add that Angel has enlisted the top academic clinical centers in China, led by the Beijing Cancer Center at Peking University. Looking forward, both Corvus and Angel will continue to enroll patients in these Phase 1/1b trials, and we aim to present data from these studies in the second half of this year. We are advancing our third clinical program, ciforadenant, in frontline renal cell cancer in a triplet combination with anti-PD-1 and anti-CTLA-4 therapies. We believe there is a very strong rationale for this novel combination based on our publication in cancer immunology research in 2018. Briefly, in those studies, we showed in several animal tumor models that ciforadenant combined with anti-CTLA-4 and anti-PD-1 were highly active, resulting in a high proportion of cured animals, even in the setting of treating established tumors. In addition to the preclinical studies noted here, we’ve published and presented clinical data in very advanced refractory patients with renal cell cancer, demonstrating anti-tumor activity with ciforadenant as monotherapy and together with anti-PD-L1 therapy. As you may recall, we also identified a biomarker, the Adenosine Gene Signature, that predicts response to adenosine blockade. These findings have been confirmed by other academic groups. Based on our preclinical and clinical results and recent emerging clinical data showing that the combination of ipilimumab and nivolumab produces long-term plateaus on progression-free survival and overall survival curves, the Kidney Cancer Clinical Trial Consortium and Corvus plan to conduct a Phase 2 trial in frontline renal cell cancer focused on the triplet combination of ciforadenant plus ipilimumab and nivolumab. The trial will enroll about 60 patients and the primary endpoints will be deep responses and progression-free survival. Deep responses refer to complete responses and partial responses with greater than 50% tumor reduction. The rationale behind this trial is to raise the plateau on progression-free survival and survival by adding ciforadenant. The Kidney Cancer consortium is led by MD Anderson and includes several leading centers such as Vanderbilt, Beth Israel in Boston, Cleveland Clinic, UT Southwestern, and others. This study is on track to begin in late April of this year. Since this is an open-label trial, I anticipate that we will get a good feel for efficacy early in the trial. To summarize our near-term opportunities, mupadolimab is a differentiated anti-CD73 antibody that we're developing initially for lung cancer. It is being utilized in a novel immunotherapy approach based on B-cell activation, and long-term, we believe it has broad applications in other cancers and in infectious diseases. We also are exploring partnering opportunities to expand mupadolimab's development scope. CPI-818 is being studied for T-cell lymphomas, and these studies are elucidating dramatic effects on T cell function, which we believe bode very well for other diseases like autoimmunity and allergy. Together with Angel, we continue to treat patients in our trial here in the United States, Canada, Australia, South Korea, and China, with a goal of initiating a global Phase 2 study. Lastly, ciforadenant is now positioned to begin clinical evaluation in first-line renal cell cancer using a novel approach aimed at increasing complete remissions and deep responses. One final point to highlight: working with Angel and the Kidney Cancer Consortium allows us to conduct multiple comprehensive clinical trials very cost-efficiently. Combined with a solid balance sheet, we have the resources to execute on our three clinical programs through several key milestones over the next couple of years. I will now turn the call over to the operator for Q&A.

Our first question is from Li Watsek with Cantor Fitzgerald.

Hey guys, thanks for taking my questions. I guess first one, I will move. I guess for the lung trial, it seems like you plan to do a Phase 2 instead of a Phase 2/3. So maybe just talk a little bit about what's behind the plan here. And then you mentioned that you initiated a Phase 2 trial in, I guess, the third quarter of this year. So just wondering what are the gating steps here? Thanks.

We chose to conduct a randomized blinded Phase 2 trial because it allows us better access to the data. This trial is not considered a registration trial by the FDA, which means we can evaluate efficacy throughout the process. We won’t be analyzing the data continuously, but we have planned interim points within the Phase 2 trial to take controlled assessments of efficacy. We have a Phase III trial ready to commence as soon as we obtain a positive signal regarding efficacy. This approach helps us efficiently transition from Phase 2 to Phase 3 while conserving resources and monitoring the data. Once we begin the Phase 3 trial, we will not be able to review the data until the trial concludes. Your second question was regarding...

Yes ...

The items we need to address before starting include aligning our sites, obtaining IRB approvals, and working with vendors. Essentially, these are mostly logistical matters.

Okay. Thank you.

Our next question is from Mara Goldstein with Mizuho. Please proceed.

Thank you for taking my question. I wanted to ask about the expansion cohorts for mupadolimab currently in process. Can you update me on the enrollment status for the 15 patient cohorts related to non-small cell lung cancer and head and neck cancer? Also, do you have an estimate on when data from CPI-818 might be available to share?

Okay. The expansion cohorts with mupadolimab are enrolling. Head and neck is enrolling very nicely. I hope to report some data on those later this year. Now keep in mind, those are very different patients than our randomized Phase 2. I mentioned the randomized Phase 2 in lung is frontline. The lung and head and neck that we're enrolling now is second, third, fourth, fifth line therapy. So very, very different patients. And I don't consider that information to be gating on our Phase 2 at all and other people are seeing that too. These late-line patients are very, very different. Now your question on CPI-818, let me just say CPI-818 is an exciting product and we're enrolling patients and we're going to present data later this year, maybe at ASH or something like that. I think that the biology coming out of this is extraordinary. I think that this is a really interesting target.

Okay. If I could just ask, is the clinical program there, the sort of global design, a function of maybe what occurred at the sintilimab FDA ADCOM or was that always anticipated to enroll patients outside of Asia?

Well, sintilimab has no relevance here. Our plan was always to enroll patients in North America and Australia, and we established Angel to speed up our global development. We do not plan to limit the trial to Chinese patients. In fact, the majority of patients in our current efforts will be from North America.

Okay. Thanks so much.

Our next question is from Roger Song with Jefferies. Please proceed.

Great. Thank you. It's for taking our questions, so maybe for the first one, for the mupadolimab Phase 2 first line non-small cell lung cancer. Rich, can you just tell a little bit about the powering assumption for these 150 patients? Also, you mentioned you potentially will have multiple kind of internal look. Just to confirm from those internal looks, if you see the efficacy signal there, you can start a Phase 3?

It's a trial with 150 patients, and it's not a registration trial; it's a Phase 2 study. I'm not entirely sure how you’re thinking about power or P values in this context. We plan to analyze the data after around 75 to 100 progression events. In a Phase 2 trial involving 150 patients, the calculations for power and P values differ somewhat. If we achieve a hazard ratio of 0.7 between the treatment and control groups, that would be quite favorable. Of course, we will also evaluate response rates and other factors. It’s important to note that the combination of chemotherapy and pembrolizumab in all lung cancer patients, not excluding those with ALK and EGFR mutations, has a median progression-free survival of approximately 8 months. That's not particularly encouraging, which is why we are focused on this trial, as we believe adding mupadolimab could potentially improve those results. For the Phase III trial, we expect it to involve around 700 patients, with an interim analysis possibly one-third of the way through. In that scenario, a hazard ratio of 0.8 could be indicative, with 90% power to achieve a P value of 0.025.

No, that's great. That's a very good kind of color around those ratio thresholds. Okay, so that's very good. And then just to clarify for the 818 data, you said second half this year, maybe around ASH. Will that include your own Phase 1b data as well as the Angel kind of China data or is that just from one or the other?

I think it would include both. But there's a lot of parts to this. There's the clinical data, and there's a lot of very interesting biologic data. You have to realize that this has never been done before, right? ITK inhibition, just like when my group did BTK, that was completely pioneering work, and that's what we're seeing here. All I can say is that this is a really interesting target.

Yes. Got it. Yes. So potentially beyond ...

And we're going to be very cautious in how we talk about this because there's a lot of interesting science, there's a lot of new targets that come about as you investigate this, new strategies, new diseases. So, this is something that I think you'll be hearing more about in the future.

Got it. Okay, great. Maybe just one last one, if I may. For the Adenosine Gene Signature biomarker, how will that be incorporated into this Kidney Clinical Trial Consortium Phase 2 or do you have some other way to enhance the ?

Okay. Great question, Roger. So first of all, let me say that the Adenosine Gene Signature has been confirmed by one major academic group, and it's a publication that’s in press now by this other academic group. So that signature appears to be very important in renal cell cancer. We are going to measure it in our frontline renal cancer study with the Kidney Cancer Consortium, but we're not going to gate on it. We're not going to exclude people based on it. As you recall, in patients with metastatic recurrent disease, it's about half of the patients that are positive for this gene signature. Now in the frontline setting, there's a lot to be learned. I don't know how common it will be in the frontline and its predictive value could be different, which is why we don’t want to gate on it. We need to collect that information. And so, we will have outcomes on patients who are Adenosine Gene Signature positive and negative. And we will see.

Our next question is from Arthur He with H.C. Wainwright.

Hey, good afternoon, Richard and Leiv. So, I just want to follow-up on the trial for the first-line lung cancer. I believe for AstraZeneca the COAST study, it was the Stage 3 lung cancer patients. And if I recall correctly, you mentioned the Stage 4. So, could you walk us through your thought process on why you chose Stage 4 versus Stage 3 for this trial?

One of the reasons AstraZeneca focused on Stage 3 lung cancer is due to the approval of durvalumab, their anti-PD-L1, for Stage 3 front-line treatment. This was primarily a business decision. While durvalumab is a leading anti-PD-1 in Stage 3, it does not have the same standing in Stage 4, which is actually more prevalent. Stage 4 represents metastatic disease, which occurs more frequently. In contrast, Stage 3 involves patients with locally advanced disease who undergo chemotherapy and radiotherapy before receiving adjuvant durvalumab or durvalumab oleclumab. The clinical settings differ, with Stage 3 being addressed earlier. However, there’s no reason to believe the biology of lung cancer cells differs significantly between Stage 3 and Stage 4. We chose to focus on Stage 4 because it is more common. We have observed some positive responses in metastatic disease with mupadolimab alone and in patients who have not responded to PD-1 therapies. We plan to combine mupadolimab with pembrolizumab, which is an approved option for Stage 4 lung cancer. The emphasis on Stage 3 by AstraZeneca relates to their earlier findings from the PACIFIC trial.

Okay. Got you. Thanks for that clarification. And I'm just curious for the potential registration trial for mupadolimab for the first-line lung cancer. Are you guys open to the design to include even possibly for the triplet including ciforadenant?

I’m sorry, the triplet, including what?

Ciforadenant.

We would consider adding the A2A blocker, but currently, our design is quite straightforward for both Phase 2 and potentially Phase 3. It involves pembrolizumab and chemotherapy, which is approved for all Stage 4 lung cancer except for the eGFR and ALK mutations, with mupadolimab included. However, if we were to introduce two experimental agents, that would complicate things a bit. All right. First, thank you all for participating in the call. We look forward to updating you on our future progress. Thank you very much.

Thank you. This does conclude today's conference. You may disconnect your lines at this time, and thank you for your participation.