Good day and thank you for standing by. Welcome to the IO Vance Biotherapeutics Second Quarter 2025 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Sarah Pellegrino, Senior Vice President, Investor Relations and Corporate Communications. Please go ahead.

Thank you, Operator. Good afternoon, and thank you for joining the IOBAN conference call and webcast to discuss our second quarter and first half 2025 financial results, as well as recent updates. Dr. Fred Vogt, our Interim Chief Executive Officer and President, will provide an introduction and brief overview of our key financial results, including revenue and revenue guidance, operating expenses, and our strategic restructuring. Dan Kirby, Chief Commercial Officer, will discuss product revenue and commercial and regulatory updates for AMTAGI. Dr. Igor Walensky, our Chief Operating Officer, will provide a manufacturing update. And Dr. Fredrick Sinkenstein, our chief medical officer, will summarize our priority pipeline program. Additional members of our leadership team, including Dr. Raj Puri, our chief regulatory officer, and Dr. Brian Gadsman, our executive vice president of medical affairs, will be available for the Q&A session. In addition, our new chief financial officer, Coraline Roche, is joining today's call. Earlier this afternoon, we issued a press release that is available on our corporate website at iovance.com. Before we start, I would like to remind everyone that statements made during this conference call will include forward-looking statements regarding iovance's goals, business focus, business plans and transactions, revenue and revenue guidance, commercial activities, clinical trials and results, regulatory approvals and interactions, plans and strategies, research and preclinical activities, potential future applications of our technologies, manufacturing capabilities, regulatory feedback and guidance, payer interactions, restructuring plans and workforce reductions, licenses and collaborations, cash position and expense guidance, and future updates. Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond our control, including the risks and uncertainties described from time to time in our SEC filings. Our results may differ materially from those projected during today's call. We undertake no obligation to publicly update any forward-looking statements. With that, I will turn the call over to Fred.

Welcome to the iAdvanced second conference call. We are more than a year into our US launch of Antagomy for advancing melanoma. The first FDA adoption continues to grow and for the first time We surpassed more than 100 patients treated in a single quarter. We are also excited about our first real-world data set for antagmium onotherapy in the commercial response rate among 41 patients and for 23 patients treated in third-line or earlier treatment settings with our label. We look forward to sharing more detailed real-world data at an upcoming medical meeting to join our ATC network. We plan to begin treating patients from these practices in the fourth quarter of this year. patients in the community are generally earlier in their melanoma treatment journey and we expect that the higher response rates observed in our real-world data set will also be relevant to these patients. Commercial business is complemented by an exciting pipeline led by our programs to extend the Lipelucil franchise in the new treatment settings and solid tumor types as well as next-generation approaches. We remain on track for multiple clinical milestones in the second half of this year including updated data from our registrational trial of lipolucle monotherapy and previously treated advanced non-small cell lung cancer, clinical data for lipolucle monotherapy and endometrial cancer, and for IVB4001, our next generation PD-1 inactivated TIL cell therapy, and for results at a high level, focusing on revenue, expenses, expected cost savings from our strategic restructuring. I'll begin with revenue and gross margin. In the second quarter, we reported $60 million in total revenue, a 22% growth over the front, $54 million from AmpagVie, $6 million from ProLukie, $109 million in total revenue for the first half of 2025, meeting our full-year 2025 revenue guidance of $250 to $300 million, inclusive of sales from AmpagVie in the U.S. and ProLukie globally. We continue to see strong demand for AmpagVie and the potential to achieve U.S. peak sales of $1 billion or more. There is also a significant opportunity to add to the revenue potential in the international markets. Gross margin was 31%, excluding non-cash items such as intangible amortization, stock-based compensation, and reserves primarily for excess proleukin inventory. Our recent restructuring is expected to improve gross margins in the near-term to reduce cost of sales. Gross margins are also expected to increase significantly through near-term optimization of manufacturing capacity utilization over the next several years. In summary we're focused on improving our profitability and are pleased with the strong momentum from our US commercial business. Transitioning the second quarter 2025 expenses total operating expenses were approximately 117 million dollars compared to approximately 102 million dollars in the prior year period. This increase is primarily related to higher headcount related costs and costs for clinical trials and marketing and advertising support for Amtagme, partially offset by reductions in stock. After experiencing a tremendous period of organizational growth in 2023 and 2024, we are fully committed to streamlining expenses and optimizing business performance through a strategic restructuring announced today. This restructuring includes a workforce reduction of approximately 19% in the third quarter of 2025 and will generate more than $100 million in annual cost savings starting in the fourth quarter of 2020. As I mentioned earlier, in addition to significantly reducing expenses, this restructuring will also significantly reduce our cost of sales and increase gross margins on an ongoing basis. I would like to extend our heartfelt appreciation and best wishes to the employees impacted by the reduction in workforce. Realigning our operating plan and cost structure involves some difficult but necessary while continuing to invest in our commercial launch success. Programs remain on track and those significant changes to our product life plan are expected. Our net cash burn is significantly reduced over our prior forecast. For the next four quarters through the second quarter of 2025, net cash burn is expected to be less than $245 million, excluding one-time charges of less than $6 million associated with the third quarter's strategic restructuring. We will continue with the assistance initiatives to expect ongoing reductions in expenses and Cash position of approximately $307 million in anticipated product revenue. including cost savings from the strategic restructuring, are expected to be sufficient to fund current and planned operations into the fourth quarter of 2026. I'm happy to go into more detail during the Q&A. Notably, we're excited to welcome our new Chief Financial Officer, Corleine Roche, who joined our team this week. We look forward to Corleine covering the financial results in detail from next quarter onwards and she's available for today's Q&A session. I will now turn the call over to Dan Kirby, Chief Commercial Officer, for a detailed update on our commercial launch.

I'd like to build on the earlier revenue discussion by highlighting individual product drivers for mTagV and ProLukin. I'll also provide an update across our three key focus areas to drive U.S. launch performance as well as our strategy for mTagV outside of the United States. From U.S. mTagV sales was approximately $54 million in the 60th century. representing a growth of 24% quarter-over-quarter. A total of 102 commercial patients were treated, representing the highest number of entangue infusions for a single quarter to date. Infusion growth was a direct result of increased field activities in existing ATCs and contribution of new ATCs onboarded earlier this year. It's also dedicated to supporting and growing ProLucan sales. Product revenue from ProLucan was approximately $6 million in the second quarter of 2025, an increase of 2% quarter over quarter. The three major U.S. wholesalers restocked during the most recent quarter, contributed primarily to manufacturing and clinical uses, not the main channel tied to Amtagna use. These two channels represent additional revenue growth opportunities. Now that wholesalers are reordering from the main channel, we expect ProLucan revenue to begin to reflect Amtagna demand. Over to the remainder of the year, we are confident in continued growth for Amtagna and ProLucan. We are confirming our full year 2025 total revenue guidance of $250 to $300 million. This aligns with our U.S. MTAGV growth forecasts, including expected momentum from community referral activities and large community practices, 2025 guidance as well as prerogates. MTAGV has the opportunity to address more than 30,000 patients globally with previously treated advanced melanoma. As Fred stated, we continue to see the potential to achieve AntagVe US peak sales of equal to or greater than $1 billion. There is also significant opportunity to add to this potential through international sales. Moving on to key launch performance drivers. Our number one goal is to establish AntagVe as the preferred option. AntagVe is a game changer for melanoma patients who have failed first-line treatment. For the first time in advanced melanoma and solid tumors, cell therapy made from the patient's own cells has been shown to induce long-term benefit with curative intent. On last quarter's call, I highlighted three key areas to drive performance and would like to comment on our part. PC network continues with strong, steady growth at early centers, new centers treating patients, and increased integration with community practice, engaging medical oncologists to guide earlier consideration for him, including 60% of patients responding in earlier treatment settings. These results reinforce our messaging in the field and can guide earlier treatment practices within the scope of our label. Our disease education focuses on the benefits of durable responses with one-time cell therapies like mTagney versus temporary responses and ongoing side effects in the oncology networks and increase the frequency, speed, and overall timeliness for mTagney referrals. I mentioned that we were working to identify alternative distribution channels on top of our traditional specialty distributor market that may offer flexibility to support community access for one-time therapies like In direct response, we entered our first agreement with McKesson's Biologic Specialty Pharmacy and other transactions are planned. This new channel will allow hospitals to have the choice to either buy mTagV directly or go through a specialty pharmacy where they do not have to directly purchase the product. Transitioning to our ex-US strategy, we are making progress toward approval in four additional markets. Canadian approval is expected imminently, and we are making progress toward approval in the UK. We gain priority review for our submission in Australia. We are also in the submission process for... In the European Union, as noted in the press release today, we recently withdrew our submission from the European Medicines Agency following lack of alignment during discussions of our clinical data. We are currently evaluating strategic options, such as including a virtual control arm in the submission, to make mTagV and TIL therapy broadly accessible to advanced melanoma patients with unmet medical need in Europe. We look forward to providing updates on our regulatory interactions in the near future. As stated previously, our full year 2025 total revenue guidance does not include mTagV sales. outside teams remain well-resourced and focused to deliver mTagV infusions for patients, drive demand, and generate revenue for mTagV and prolupin to move IOVANCE forward. I am committed and motivated to lead our commercial organization toward success. I am deeply committed to IOVANCE's mission of pioneering a new treatment paradigm for physicians who treat patients with solid tumors, which represent 90% of all cancers. I will now pass the call over to Iver Walensky, our Chief Operating Officer, to highlight our manufacturing process. ...recent organizational changes.

I'll also build on Fred's introductory carnal manufacturing facility provides the vast majority of patients today for both commercial and clinical manufacturing. Our contract manufacturer provides second implement operational efficiencies and optimize cost of... to scale up, capturing success, specifications, these locations raised by them from manufacturing.

Holding on my colleague's comments about MTAGV or life illucal, the durability of responses following one-time treatment is a key differentiator from other available and emerging therapies. This durability message was reinforced in the recent publication of the final five-year analysis from our C14401 trial in the Journal of Clinical Oncology, and the simultaneous presentation at the American Society of Clinical Oncology annual meeting. Unprecedented durability and duration of follow-up were demonstrated in previously treated advanced melanoma patients. 31% of patients responded, with nearly a third of responders ongoing. The five-year overall survival rate was almost 20%. In the real-world treatment settings, we are excited to see even better response rates of approximately 50% overall and 60% in less heavily treated patients following life elucil. We look forward to presenting this real-world data at a future medical meeting. Following the strategic restructuring, our priorities are to expand mTagV into additional solid tumor types and earlier lines of therapy and to advance our key next-generation TIL until treatment regimen. In frontline advanced melanoma, Tilvance 301 is our global registrational phase 3 trial designed with FDA and EMA input to show the contribution of components. We are investigating mTagV in combination with pembrolizumab compared to pembrolizumab alone. Tilvance 301 remains on track as the confirmatory trial for mTagV monotherapy in our initial indication And this trial could also support accelerated and full approvals of MTAGV in combination with pembrolizumab in frontline advanced melanoma. We look forward to sharing results from several clinical trials before the end of the year for lifelucil in non-smart lung and endometrial cancers, as well as on our PD-1 inactivated tilt cell therapy IOV4001. IOV-LUN202 is our registrational program intended to extend the label for life-elusive monotherapy to include previously treated advanced non-small cell lung cancer. This trial design aligns with FDA guidance for single-arm trials to support accelerated approvals for single agents in conditions with unmet medical needs. Chemotherapy, the current standard of care in this treatment setting, provides limited rate and duration of responses. The FDA previously provided positive regulatory feedback on the IOV-LUN2-2 clinical trial design and the proposed potency assay matrix to support registration. We expect data from IOV-LUN2-2 to support a potential regulatory decision on U.S. accelerated approval in 2027 for previously treated non-small cell lung cancer patients. In our IOV-END In the PD201 clinical trial, we've seen promising signs of initial efficacy for liferutal monotherapy in previously treated patients with advanced endometrial cancer. Our PD1 inactivated tilt cell therapy, IOV4001, is in a first-in-human trial and reflects our leadership in next-generation approaches to optimize TIL and TIL treatment regimens. We are also treating patients in a Phase 1-2 clinical trial of IOV-3001, a next-generation IL-2 for use with the tilt cell therapy treatment regimen. Finally, we plan to submit an investigational new drug application to FDA early next year for IOV-5001. This genetically engineered, inducible and tethered IL-12 tilt cell therapy may expand our development opportunities. It's a wide range of common solid tumor cancers. I'm happy to address questions during the Q&A session. Now I turn the call over to the operator to begin the question and answer session.

As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. In the interest of time, we ask that you please remember yourself to one question. You may rejoin the queue for any additional questions or follow-ups. Please stand by while we compile the Q&A roster. Our first question comes from Yanin Zhu with Wells Fargo. Your line is open.

Oh, great. Thanks for taking our questions, and congrats on the quarter. I was wondering, can you talk about the patient number from 1Q to 2Q? Because I don't think we had a good sense of exactly how many patients you infused last quarter in 1Q. So we wanted to understand the growth in patient number. And I also think you might have increased the price. So perhaps talk about the price change and impact for MTAP-V revenue as well. And if you can also comment on where do you think those infusion numbers will go in the coming quarters relative to your guidance and confidence. That would be super helpful. Thank you.

Thanks, John. And I'll start, and then I'll ask Dan Kirby to add some comments to this, too. So the number of infusions we had this quarter was 102. Last quarter, it was 83. So that was substantial growth over the last quarter, obviously. There was a price increase that came into effect on April 1st, which took the price of the product of Ampag to $560. We expect growth, and I'll let Dan talk about what we expect in the second half of this year.

So for the price increase, I think your question was, did we see any impact of the price increase on demand? We did not see any impact. In fact, demand as being any kind of... With that, we also look at the future and where we see patients coming in. We have our new centers coming on, and they continue to ramp up demand as well as our existing centers. What we do see in the future happening is we're in the process of opening some ATCs that are closer in the community networks. I mentioned the distribution channel we added. That is specifically at their request, which gives us access to hospitals that normally we're not going to purchase Antacne. So we do see demand in the second half to be strong to meet the guidance that we...

Sorry, if I may quickly follow up. I think I heard the growth in patient number was from 83 to 102.

I'm sorry, 85 to 102, yeah.

85 to 102, that's pretty good growth. Do you anticipate similar growth going forward or any color there, just so we have a better sense about what to expect in the coming quarters?

We anticipate demand to continue to be strong. As far as quarter-on-quarter growth, we don't want to guide to that, that we have in our guidance with it, which would indicate second-half demand will be strong.

Thank you. Our next question comes from Peter Lawson with Barclays. Your line is open.

Great. Thank you so much. Thanks for all the detail on the call. Fred, just as you think about the guidance, just your level of confidence around proleukin, you mentioned it kind of accelerating in the second half, kind of what gives you that level of confidence. What do you think the proleukin number could be? And have there been any changes is in the number of proleukin injections? Thank you.

Hi, Peter. I'll take that question. I think for proleukin in the mainline channel, what we did see as evidence in the revenue from Q1 was we're seeing the manufacturing and the clinical trial channel that represented the Q1 revenue. In Q2, we started seeing the re- So what we expect to see moving forward is those orders continuing to reflect more of the MTAG utilization. along with that we are since we are seeing strong demand to use with them tag me so we have not seen the number of doses and tag me we're not seeing the doses of proleukin change but the average doses remain consistent and then finally we do anticipate some pickup in in proglucin based on the fact that you

our next question comes from Andrew side with Jeffrey's your line is open hey good afternoon thanks for the updates appreciate you taking the question.

So if the guidance for net cash burn is going to be less than 235 over the next year, and I believe restructuring happens later in the year, it feels as if you're expecting gross margins to improve meaningfully, maybe even as early as Q3 relative to Q2 and Q1. Is that accurate? And if so, can you give us some color why that could be the case in terms of a meaningful margin improvement. Thank you.

Yeah, Andrew, thank you for the question. It was $245, not $235. You can see it in the press release and in our remarks there, but your question is still a good question. Yes, we expect margins to improve. Thank you.

Our next question comes from Salim Syed with Mizuho. Your line is open.

Hi, this is Bennett for Salim. Thanks for taking our questions. Could you elaborate on the decision to withdraw about the marketing authorization application in Europe? What was the feedback with the E-man? What are the steps that you're planning to take to commercialize in Europe? And regarding the announcer structuring, are you also planning to reduce R&D expenses? And if so, could you comment on any specific actions you would be planning to take to reduce, for example, clinical expenses? Thank you.

Yeah, I'll take the second question first. We didn't reduce some R&D expenses, but we are not expecting any significant changes in our clinical pipeline as we discussed on With respect to the EMA, we withdrew when we learned late in the review process that we need to include additional analysis in our submission. So what we want to do is go back and resubmit with an additional analysis such as the virtual control arm. Our strategy does not require us to run additional clinical trials and we think that can happen relatively quickly. will be seeking scientific advice from the EMA soon to try and get back in there and work on that again with them. But that was really what the issue was. It has to do with the data package that was submitted, which we submitted was similar to the FDA package and Elcada package and everything else, and they would like to see some more. And the easiest route for us to do that is...

Thank you. Our next question comes from Tyler Van Buren with TD Cowan. Your line is open.

Great. This is Nick on for Tyler. Can you provide an update on how infusions are tracking from TAG-V quarter to date? And then second, in the first earnings call, in the first quarter earnings call, you noted that 69% of ADCs have infused one patient, while 16% infused 10 or more. Can you provide an update on these metrics and the plan to increase prescribing?

I'll take that one. Thanks for the questions. For the infusions quarter to date, we do see strong demands. However, we can't comment on how many infusions quoted a day. That's been our policy. As far as the percentage increase with it, those percents, they have gone up, obviously. We have not appreciably a lot more centers that came on in the last quarter. However, we went up 24% infusions. So those numbers by centers are going up with it, but we decided not to continually track those as a metric.

Thank you.

Thank you. Our next question comes from Colleen Cousy with Bayard. your line is open.

Hi, good afternoon. Thanks for taking our questions. So this EMA feedback on melanoma, do you expect this to impact your path forward in PD-1-treated non-small cell lung cancer?

No, not right now. Absolutely not. It has nothing to do with the United States whatsoever. Raj, Raj, for your key comment on this.

Yeah, I think, Colleen, that any impact on the going forward of continuing non-small cell lung cancer.

Great. And one quick follow-up. What sort of issues does moving to a specialty pharmacy solve for centers versus just buying through you directly?

It's a great question. It really solves, if you think about the hospitals that are involved with the community clinics and you get close to where the patients are, a lot of times you're dealing with medium-sized hospitals that have all the capabilities to administer and tag me. However, one-time therapies that have higher price tags, the finance department, so they would rather go around where they would go through a specialty pharmacy where the purchase would happen through the specialty pharmacy and the specialty pharmacy would get reimbursed from the payer versus the purchase happening directly from the finance department ad.

Great. Thank you.

Thank you. As a reminder, to ask a question, please press star 11. Again, that is star 11 to ask a question. You may rejoin the queue for any additional questions or follow ups. Our next question comes from Rennie Benjamin with Citizens. Your line is open.

Hey, guys. Thanks for taking the questions. Maybe one, can you just talk a little bit about, you know, the numbers in terms of patient drop-offs versus the manufacturing kind of out-of-spec rates? I think Igor, you know, had some prepared remarks regarding that. Can you just talk about the specifics from first quarter to second quarter and how you see that potentially improving throughout the rest of the year? And then kind of just going back to a previous question regarding McKesson, how do you see this, you know, potentially improving revenues going Like, is this something that should kind of minimally increase revenues? Like, how should we be thinking about the number of patients these one-off hospitals, you know, how much they might use this?

Adrian, thanks for the question. So, on the first part of the question, as I mentioned, the manufacturing success rates normalized in the second quarter. So, both the out-of-spec rate and the patient drop-off rates decreased, and we're seeing further improvement in the third quarter so far. And as you can see in the queue, you will see in the queue this crop. Beyond that, we're not sharing the exact percentages, but again, you can look at this crop.

Regarding both patient drop-off as well as the impact of specialty pharmacy, which are a little bit related. So patient drop-off does remain somewhat consistent, although we did see that we were getting patients a bit earlier in this quarter versus previous quarters. And we weren't seeing as many patients that were not making an evenedit tissue procurement. So we are making strides in that. The impact of specialty pharmacy allows us to actually get closer. What we should be thinking about is we're starting our journey right now. Other cell therapies are following our lead. gene therapies this could get us next to those clinics that are affiliated with those hospitals inside of their network without the cost burden so it could have a big impact long term we already have several got it and if i can just have a quick follow-up just regarding the clinical trials that are ongoing um for friedrich just can you provide us any color in terms of you know how many patients

are enrolled in each of these studies, how many patients' worth of data might we see for non-small cell as well as the other ones that we're expecting like endometrial in the second half of this year?

Yeah, happy to respond to that. So I think what we said is that we're going to share data by the end of the year. We will provide that information as part of those updates. I don't think that we will pre-define at which patient number we would be doing that. Thank you.

Thank you. Our next question comes from David Dye with UBS. Your line is open.

Hey, guys. Yeah, thanks for taking my questions. So, first question just around thinking about the patient ramps more intactly. Based on current round rate, we calculated that patients need to grow about 26 to 32 patients per quarter over the next couple of quarters in the midpoint of the guidance. Could you just provide any detail that you're on track ahead of that patient growth? And secondly, on the ATCs, you have 80 right now. How many of these ATCs are newly activated compared to last quarter, and how many are still being activated?

So, one of the things, I'll take that question with it. As far as the patient ramp, just to let you know, the $250 to $300 million is combined revenue between ProLucan and EmTagme. So on the map there, those numbers aren't 26 to 30 per quarter, each quarter to grow to hit those numbers. But we are confident that we are tracking towards that range and seeing EmTagme demand continue to strengthen and grow towards the end of the year, as well as ProLucan, as we mentioned before, having all three wholesalers starting to order very soon, two of those doing so currently in the main channel, give us our path forward. The second question is, again, we're focusing on quality, not quantity. We happen to open several ATCs in the last quarter with it. Each one of those has been carefully vetted to have referral patterns in place so they can get earlier patients in there. And we are seeing, and I'm not going to give the exact numbers here, we are seeing a substantial number of patients coming in the queue, both that have been already infused by them, but also, too, where they're enrolling in there to have manufacturing done for a tagged in queue.

I'm showing no further questions at this time. I would now like to turn it back to Fred Vogt, Interim Chief Executive Officer and President, for closing remarks.

Thank you again for joining the iAdvanced Biotherapeutic second quarter of 2025 Financial Results and Corporate Updates Conference poll. We look forward to providing future updates on our growing commercial and clinical portfolio, including our amtagamy real-world data presentation and planned data updates from our lung endometrial and next-generation TIL studies. We are motivated by the stories we continue to hear about the patients who benefit from my advanced tilt cell to remain the global leader in innovating, developing, and delivering current and future generations of tilt cell therapies for patients with cancer.

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