Iovance Biotherapeutics, Inc. (IOVA) Q2 2026 Earnings Call Transcript

Welcome to the IOVance Biotherapeutics Second Quarter 2026 Conference Call. My name is Daniel and I will be your Operator for today's call. At this time, all participants are in a listen-only mode. Later we will conduct a question and answer session. Please note that this conference call is being recorded. I will now turn the call over to Sarah Pellegrino, Senior Vice President, Investor Relations and Corporate Communications at IOVance. Sarah, you may begin.

Thank you, Operator. Good morning and welcome to the Iovance webcast to discuss our second quarter 2026 financial results, business achievements, and corporate updates. This morning we issued a press release that is available on our corporate website at iovance.com. 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, Submissions, Feedback and Guidance, Plans and Strategies, Research and Pre-Clinical Activities, Potential Future Applications of our Technology, Manufacturing Capabilities, Payor Interactions, Licenses and Collaborations, Cash Position 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 filing, materially from those projected during today's call. We undertake no obligation to publicly update any forward-looking statements. I will turn the call over now to Dr. Fred Vogt, Interim CEO and President.

Thank you, Sarah. Iovance is the global leader in innovating, developing, and delivering pill therapy for solid tumors, today and for the next generation. The second quarter of 2026 was our strongest yet. We delivered record revenue and margin, advanced our pipeline, and secured important new regulatory approvals and designations. Having a few notable achievements, our foundation for growth expanded. More authorized treatment centers, or ATCs, are activating, enrolling, and infusing patients than ever before. We reported $99.3 million in revenue, driven by record amtagami demand. We also greatly exceeded both our amtagami and total revenue guidance ranges for the second quarter. Second quarter margin also, we expect margin to keep expanding as we increase revenue, fine-tune execution, and gain efficiency at scale. Looking ahead, we maintain our peak assumptions for amtagami and proleukin of more than $1 billion dollars in US sales from advanced melanoma alone. The opportunity and other indications is significantly larger. Performance of data is very strong. Once we fully assess increasing growth trends we expect to provide an update to our full-year guidance during the third quarter. We are now providing commercially unpacking to more than 50 patients a month on top of increasing numbers of clinical patients which demonstrates both our manufacturing scale and how broadly accessible our cell therapies have become, and not choosing between growth and discipline. This quarter we delivered both. Research and development expense has improved for the fourth consecutive quarter, even as every lead program advanced and our pipeline grew. We are closing in on our pursuit of the largest opportunities for cancer patients who have the greatest on that need. The technology platform is scaling quickly. Recent regulatory and clinical milestones bring cell therapy forward for more patients in the U.S., as well as new markets and additional solid tumor indications. Nearly 2,000 patients have received diavance pill therapies in commercial and clinical settings across hundreds of centers in the U.S. and in 30 countries. Over the coming years, our vision is to reach tens of thousands of patients. It's nearly complete in our Lung 202 trial and the pivotal cohorts in non-squamous, non-small cell lung cancer. This indication represents a blockbuster opportunity that is roughly seven times that of advanced melanoma. We look forward to providing program updates in the fourth quarter as we work towards Supplemental Biologics License Applications in 2027. We're moving quickly with our two advanced soft tissue sarcomas. The FDA granted fast-track designation in undifferentiated polymorphic sarcoma and de-differentiated liposarcoma, validating the promise of the initial clinical data for liposarcoma, as well as the substantial unmet medical need of both indications. In a pilot study with one-time lightfalusal therapy, the objective response rate was an unprecedented 50% in the first six valuable patients compared with abysmal response rates of less than 5% using current standard of care in these refractory treatment settings. Our translational data and state-of-the-art technologies are uncovering the next frontier in tilt therapy. We are now able to identify highly responsive patient populations across solid tumor indications that comprise more than 90% of all cancers. For example, a histology-based biomarker strategy produced striking early Phase II data in the first five evaluable patients with metastatic serous endometrial cancer. In our N201 trial, we reported a 40% confirmed objective response rate and a 100% disease control rate. We're submitting a protocol amendment engaging with the FDA on an expedited approval pathway. Our leadership in tilt therapy includes continuous investment in next-generation programs. A new trial known as G1-TIL-1 is using IOB5001, our next generation IL-12 tethered TIL therapy. This Phase 1-2 BASC trial will run across prevalent solid tumors representing more than 100,000 U.S. deaths annually, including metastatic colorectal, triple negative breast, and estrogen receptor low breast cancers, orders alike. IOBANS is the first and only company supported by our scalable manufacturing infrastructure, clinical breadth combined in solid execution. Iovance has never been a better position for long as Corleen Roach, our Chief Financial Officer, to detail our financial results.

Thanks, Fred, and good morning, everyone. I want to demonstrate our commitment to top-line growth, operational excellence, and financial discipline as we build a sustainable, self-funded business. Second quarter total revenue was more than $99 million year-over-year and 39% sequentially from the first quarter, which have included one-time non-recurring. MPAGV was the key growth driver, reaching a new high of approximately $91 million in We exceeded our second quarter MPAGV guidance range of $79 to $81 million, and second quarter MPAGV revenue increased roughly 51% over the first quarter of 2026 and 68% year-over-year, reflecting a robust increase in patient demand and adoption. ProLukan contributed about $9 million in the second quarter, slightly down from $11 million in the prior quarter due to timing of wholesaler inventory stocking. For the full year 2020, we anticipate that ProLukan as a percentage of total revenue will be in line with 2025. Consistent with the prior quarters, overall gross to net impact remains minimal at less than 2%, Margin increased to approximately 56% up from 41% in the first quarter and above our previous all-time high of 50% in the fourth quarter of 2020. With the year-to-date 2026 margin of 50%, the second quarter benefited from higher integrity volume, continued cost optimization, and maturing internal efficiencies during our first full quarter of manufacturing exclusively in-house. We are also deploying and advancing artificial intelligence tools to drive significant future cost efficiencies and new product pipeline insights. We expand our business as well as our development pipeline. We are very closely managing operating expenses. Research and development expenses were about $59 million, down from $62 million in the prior quarter reflecting ongoing efficiency gains as we progress all of our program consecutive quarter cost savings through R&D optimization selling general and administrative expenses held essentially flat at about 39 million dollars even as revenue grew roughly 39% with clear operating leverage from our commercial infrastructure we expect to gain further efficiency with targeted investment across based on strong second quarter sales we are reviewing our previously issued full year 2026 total revenue guidance of 350 to 370 million dollars and plan to share more detail in the third quarter we are well capitalized to fund both the launch and their pipeline as of June 30th 2026 we had approximately three hundred and four million dollars in cash cash equivalents and short-term investments. This cash position is now expected to fund operations into the second half of 2028. When I joined IVAN, the revenue reached profitability as quickly as possible. On my one-year anniversary, I am pleased to highlight that all three of these priorities are translating into positive results and lasting value for patients and our shareholders. I'll turn the call to Dan Kirby, our Chief Commercial Officer, to review our commercial progress.

Thank you, Corleen. As mentioned, Amtagne generated record revenue with more patients treated than in any prior order, carrying into the third quarter. Adoption isn't just growing, it's broadening into new ATCs and earlier lines of treatment, which are rising physician awareness, continued expansion of our ATC network, and a deepening body of clinical of Antagny. Among both treating and referring physicians, unaided awareness has increased nearly three points. One, a new marketing campaign, a failed at ASCO, and two, improvement in sales force effectiveness, measured by meaningful growth in both number of treaters and... The second priority is increasing our footprint across both academic and community settings. With more than 95 total, we are on track to reach at least 110. Community ATCs now represent a third of our network and are expected to increase significantly over the next several quarters. Each new ATC is widening our commercial reach to the patients who need it. The third priority of our already deep, industry-leading clinical evidence, in addition, our clinical trial. This analysis estimated that the AMTAGV 10-year overall survival for responders would be 46.7%. Independently, a growing number of our ATCs are publishing their own real-world response rates and patients exceed what we observed in our clinical trials, which support the emerging practices these aggregated are being deployed across our sales force in conversations with ATCs and physicians. This information can be found on the publications page of our website at iAdvance.com for those interested. More than 75% of our U.S. ATCs are strategically located in proximity to most addressable patients. More than 95% of patients live within 200 miles, and 80% of patients live within 100 miles. With our rapidly expanding ATCs, we expect even broader access. Importantly, we are also proving we can deliver on our promise to patients. With the turnaround time, talking inventory, and ordering in line with AmtagV demand. For the rest of the year, we expect melanoma patients to support international private pay patients. Australia has the highest rate of melanoma while we work with the government on the United Kingdom and Switzerland towards resubmission. Together, these foundational international markets augment our growing U.S. franchise Demand for anti-I.V. Rising physician awareness is converting into more patients' treatment, and the deepening clinical evidence is expanding the adjustable patient population with a one-time cell therapy that delivers meaningful.

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. Please stand by while we compile the Q&A roster. Our first question comes from Andrew Tsai with Jeffries. Your line is open.

Hey, good morning. Thanks. Congrats on a great quarter. So can you talk about this large upswing in Q2 that even came out well ahead of your guidance? Was it purely due to underlying demand, or was there kind of any one-off in the timing of shipments maybe being more favorable in Q2? Just wanted to check the box on that. And then secondly, on the lung update later in Q4, just wanted to clarify on the cadence of events we can expect here. Is it fair to assume you would first need to complete enrollment in this pivotal cohort first and then generate follow-up data on every enrolled patient before you top-line the data? Or can the top line data be on the majority of patients, not necessarily all patients with follow-up? Thank you.

So I'll take the first part on demand. It's a great question. What we saw on demand was, as I said on the call script, essentially we saw that awareness is increasing among our physician-based, both treaters and referrers. We are expanding our ATC network. And then the clinical data is evidence of mTagV's efficacy. One thing that did happened in the first quarter that helped us in the second quarter was we had the manuscript published on our real-world evidence data that showed over 50% of the patients with two or fewer lines of therapy were responding that data helped propel our sales force and our commercial effort and encourage more patients to be treated we expect this to continue and we are seeing this in the third quarter and I'll just add to Dan just to be very clear or anything this is organic demand for the product it's looking very good right now based on all the factors that Dan described, the more demand is going to continue to increase

significantly for AMPAGV throughout the coming quarters. On your question about the Lung 202 update, yes, I think it's fair to assume we're going to complete enrollment very soon, and we would want to finish that process before we put any kind of material update out, obviously for FDA purposes we want to do that, but I don't think it's fair to assume that we would wait for every single patient to become a patients in before we put some data out. Some of the patients may still be coming for their first evaluation, that kind of thing, when we put that out, or maybe not. Depends on the timing and how the data looks. So just stay tuned. The lung is looking very positive right now. We feel very good about where we stand with the study to say about that. I know that's a very key thing for investors, and I really urge everybody to watch carefully as we talk about that, and maybe even more than what people are expecting in this space.

Thanks so much.

Congratulations. Thank you. Our next question comes from Yanin Zhu with Wells Fargo. Your line is open.

Great, great. I'll add my congrats on a very strong quarter. Maybe from Fred's comment, it sounds like for the next two quarters, you expect the sales or the demand to further build upon the current demand level or the second quarter demand level. I just want to see if that's the correct interpretation. And in terms of giving your visibility into the third quarter and perhaps also into the fourth quarter, can you talk about your expectation and also the guidance sounds like it's going to come during the third quarter is that the case rather than at the next quarter's earnings call perhaps also a question on Tilvan 301 can you give an update on where you are and sounds like you have a presentation at ESMO, yeah, can you talk about what can we expect the data there?

Sure, yeah. Let me cover the first two, and then Dan can comment, and then I'll come back to Tilvance at the end. Yes. I think you heard correctly. Demand trends are very positive right now for the Ampag-V product, and we expect increasing demand Q3 and Q4. We're obviously seeing quite a bit of Q3 right now. We want to just evaluate the whole situation because we really focus on long-term guidance We want to make sure we can give good guidance for the full year before we announce it. But you are correct. We are intending to make a separate announcement of guidance, so one morning you'll wake up to some hopefully very positive news, I think, from my advance on the guidance as we get that visibility. I can't tell you exactly when, but obviously sometimes. But yes, that's very strong and tag me strong, and as we pointed out, per looping demand is very strong. Dan, do you want to comment and add some detail to that?

For Q3 right now, as you mentioned, Jan, and we do have pretty good insight into Q3 and what's going on right now, the demand continues to grow, and so we're very confident that Q3 will build upon the success in Q2, and then we've expanded our sales force, we continue to evaluate, we continue that growth driving not only through 2026, but 2026.

And then I'll come back and answer your question about Tobin's 0.1. That study continues to run well. We're very happy with the performance of the study. At ESMO, we're going to, again, in an oral session there, highlight some of the compelling clinical characteristics of ampagomy plus pembrolizumab in the frontline setting including the fact that almost a third of patients go into a complete response we have a very rapid velocity of response meaning we can drive patients into a response much faster than other alternative therapies we think and we'll show much more insight I think from the predecessor phase 2 study obviously Tilvance is a randomized trial that we can't look at right now it's blinded we'll read that the interim point hopefully relatively soon although these trials take a long time to run as you know but we're going to show the compelling clinical characteristics and I think it's going to be a very important output for people in the field especially since the some of the excitement around leg three has faded especially post ASCO with Regeneron's results and you know off the leg is still in some cases being questioned is whether it's the right combination in the frontline setting and there really is a extremely large need for something some alternative to Ipidivo in the frontline setting for these patients. We think glypholucyl's characteristics are perfect for this, would be one-time therapy combined with what may end up being fairly limited PEMPRO dosing, and the fact that we can drive a large percentage of patients into what's effectively a cure.

Great. Thanks for the update. Thank you. Our next question comes from Edzer DeRoot with Barclays. Your line is open.

Great. Thanks for taking the question, and congrats on the strong second quarter. One question on margins, and then one on Lung. You had a meaningful step up, obviously, in gross margins in the second quarter. Maybe if you could talk about the remaining opportunities to improve margins further relative to current levels and where you think mature commercial margins could ultimately trend to over time, that would be great. And then on Lung, obviously, the durability exceeds historical benchmarks from what you've previously shown. Is the internal goal there to replicate earlier data from an efficacy and durability standpoint, and also with enrollment nearly complete, have you continued to enroll patients with similar baseline characteristics from the prior update? Thank you.

Hi, Esther. It's Coraline. So, I'll answer your margin question. The driver is a number of things, and as you know, we've been focusing on this internally and we've been talking about it. obviously higher volume which you can see but we have all our manufacturing in-house and those efficiencies are also helping margin as well as these projects that we have where we're continuing to focus on margin improvement and operational efficiencies within the plant I would think about that in terms of things like that you know one other point I'll just add to what Corleen said is as we've been and others pointed out here already with proleukin now normalizing and then Perlucan sales expected to increase this year and then

stabilize at the right percentage going forwards. Perlucan is a very high-margin product so you can expect a little bit of tailwind there as well. On Lung 202 I just want to, you asked two questions there answered. One was do we, is our internal goal to replicate the durability, it's to actually exceed the durability because when we reported the durability earlier we had a shorter follow-up and I think what we're seeing right now we're not going to pre-release the results here obviously right now we're seeing very strong durability I think very similar in an overall product when we get a response it's usually pretty durable whether it ends up being two years three years whatever it's going to be we'll find that out we do the ultimate stats analysis at the end but it looks pretty good I think any of those options are going to be on the marketplace in terms of a product that will will attract a lot of prescribers in patients to a one-time therapy like that and then you mentioned with enrollment nearly complete you asked about the baseline characteristics of the patients I think we are seeing similar baseline through it we don't have a lot of heterogeneity in our population we're very comfortable with how how we enroll these studies we've spent a lot of time on our protocols to make sure we get things right and yes I think we're seeing similar patients come through right now than we were throughout the study obviously we change our lymphed deflation to make it a little less burdensome on patients, and we're seeing really good results with that right now in terms of the safety profile and the overall Great.

Thanks for the color, and congrats again.

Thank you. Our next question comes from Rennie Benjamin with Citizens. Your line is open.

Hey, good morning, guys. Thanks for taking the questions, and congratulations on an amazing quarter. Just two questions from us. I guess one regarding the outlook and the the fact that you're reviewing guidance, can you talk a little bit about what factors go into providing this reviewed outlook and kind of what prevents you from providing that guidance now? And related to that, you know, does Replimune's recent positive, you know, FDA advisory committee feedback and maybe even the Obsidian, you know, going public, does that kind of impact guidance? And if not, kind of what are your thoughts regarding at least Replimune's agent coming into the marketplace. And just as a final question, the endometrial study, Fred, you had mentioned, you know, systology-based patient selection and that there are protocol amendments going on right now. Can you talk a little bit or provide some color regarding the protocol amendments and, you know, how that study will ultimately reach conclusion? Thanks.

Let me pick the last one first, Freddie, because it's fast. It's a protocol amendment to focus on the serous subtype and it really links up with the disclosure we had last quarter about the response rate that we're seeing and that precise approach to how we deliver teletherapy to certain histological subpopulations in our studies well we have a lot more to say about that across all the indications soon on the guidance what we're doing with the guidance internally is we're going to make sure we understand Q3 but really we want to understand full year we're not looking to give guidance that is just sort of short term we're really focused on long-term guidance to show the strength of the product overall we really obviously we cater to long investors on orders to stock and we want to make sure they have the information they need to understand that the overall trajectory so what we're going to do is make sure we have our demand understood fully obviously it's very good and then we will come back out at some point which I can't tell you exactly when it's going to be during the third quarter and we will announce some something that I think everybody will find on the competitor front obviously there's a lot of noise out there the people have their their drama that's going along with with the FDA obviously product could get approved or not get approved we don't really know it is primarily competitive with TVEC which is also an oncolic virus very similar to that product as well as products like optolag that are being recycled in the community right now it has a lot of barriers like TVEC did and when a goes to launch a product they have to perform and we expect AmtagV is a much more compelling option I think for patients with its one-time profile and really fantastic efficacy and tons of real world experience now and so we think that'll be good and with the other company Obsidian it's a tilt competitor I think and the infrastructure Iovance has and the strength that we have and the have in this area before they sort of just randomly assume that some other tilt company is going to come out of nowhere and somehow conquer the world here. So just bear that in mind that there's reality with all these things. Many investors have visited us and see the scale of what we do. We can see the power of what we do and how much there's a giant boat around Ivey.

Thanks for taking the questions.

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

Great. Thanks for taking my questions. And also my congratulations on a great quarter. I have two questions. So on time with demand, can you just talk more about the demand various across different ATCs. Do you see more demand concentrating in large ATCs, or do you see increased demand in smaller and newly activated ATCs that have a follow-up?

Thanks for the question. What we saw and what we are seeing right now is the ATCs that we originally opened in 2024 are starting to grow based on patient type and based on the information that we have that's been published recently. The ATCs that we onboarded last year in 2025, those are continuing to accelerate. Some of them are hitting their strides, so to speak, and then in the first half of this year, we've been opening ATCs at a pretty substantial pace, and those are starting to contribute now. So we do see there's a few months between an ATC activation to them starting to treat patients, and then comfort level goes up. So we are seeing growth across the different segments. In regard to larger ATCs and whether they're contributing to more, I think our larger ATCs are still growing. We still haven't had an ATC that we can say has reached complete peak because they keep looking for new patients and patient types then. So we are seeing across our subset of ATCs.

Thanks for the color. And then on community ATCs, which now represent roughly one-third of the network, how does patient volume, reformed behavior, and reimbursement experience differ between community and academic Great question.

So for patient volume, they have the patients there, and it's really not the number of patients. It's what time we're getting these patients. So as we said in the real-world data that got published earlier this year, is that patients that are on two or fewer lines of therapy have an over 50% which reside primarily in the community. So we see referral barriers go down. The volume of patients are there, and they're there earlier. We do see the community ETCs are having learning curves similar. Most of the community ATCs, we started to onboard in the second half of last year. I joined in the first half, and that would be that they can have a higher ceiling than the academic. It's organic referral patterns within network, which are much easier to maximize than referring to the academic.

Thank you so much.

Thank you. Our next question comes from Colleen Cousy with Baird. Your line is open.

Hey, everyone. It's Nick on for Colleen. Thanks for taking the question. Congrats on the quarter. Just wondering if you could provide any color on how the conversion rate from referrals that treated patients has changed over the last few quarters. And then also just on just growth bottlenecks like patient identification referrals, et cetera, what do you expect to be the biggest constraint on growth going forward? And just wondering if you could talk about how you plan on addressing that. Sure.

So as we look at this, the conversion to referrals, what we do see is earlier patients. earlier patients coming in we're using that data in both non-personal media as well as in face-to-face with our with our field courses to get that word out so again we are seeing the referrals come in earlier which means we have time to treat the patients so that is the change in the referral patterns of an earlier patient and that gets into patient ID as well we have gone after I've mentioned in previous calls the VRAP mutated patients because that is a a very important patient type, 40% of our market, that we were having trouble accessing before we're getting tumor tissue earlier. That is helping us ID these patients earlier to get tissue so we can manufacture. The constraints that we're working on is really more penetration into the larger community networks, and we see that as an opportunity. We've made a lot of strides over the last six to eight months with getting the referral pattern within their own networks. We've got some up right now in those areas. We're looking to get more up. Fred, did you have anything to add?

Thank you. This concludes the question and answer session. I would now like to turn it back to Fred Vogt for closing remarks.

Thank you for joining us. This was a record quarter for revenue infusions and margin. Our pipeline is advancing rapidly with new registrational trials, next generation clinical programs, and new approvals outside the United States. We are energized by the growing number of patient stories that show the power. We remain deeply grateful to the patients. I want to thank our exceptional high-advanced team, our dedicated shareholders, and our covering analysts for their continued support. We remain committed to our mission to innovate, develop, and deliver current and next-generation cell therapies for patients with cancer.

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