CTMX

Good afternoon, everyone. Thank you for standing by. Welcome to the CytomX Therapeutics' first quarter 2026 financial results call. Please be advised that today's conference is being recorded. I would now like to hand the call over to your host for today, Chris Ogden, CytomX Chief Financial Officer. Please go ahead.

Thank you. Good afternoon, and thank you for joining us. Before we begin, I would like to remind everyone that during this call, we'll be making forward-looking statements. Because forward-looking statements relate to the future, they're subject to inherent uncertainties and risks that are difficult to predict and many of which are outside of our control. Important risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future developments, or otherwise. Earlier this afternoon, we issued a press release that includes a summary of our first quarter 2026 financial results and highlights recent progress at CytomX. We encourage everyone to read today's press release and the associated materials which have been filed with the SEC.

Additionally, the press release, recording of this call, and our SEC filings can be found under the Investors and News section of our website. With me on the call today is Dr. Sean McCarthy, CytomX's Chief Executive Officer and Chairman. Sean will provide an update on our pipeline and company progress before I cover the financials for the quarter. We will then conclude with a Q&A session. With that, I'll now turn the call over to Sean.

Thanks, Chris, and good afternoon, everyone. We're very pleased to be here today to provide an update on our first quarter developments and guidance for what's continuing to be a transformational year for CytomX. 2026 is off to a very exciting start, driven by our excellent clinical progress with Varseta-M in late-line colorectal cancer. Varseta-M is a first-in-class EpCAM targeting antibody drug conjugate, or ADC, that was uniquely designed and enabled by our proprietary Probody therapeutic masking platform. Varseta-M is the only EpCAM-directed ADC in clinical development to our knowledge, affording us a strong lead and a powerful competitive advantage. EpCAM is one of the most abundant solid tumor surface antigens. CytomX's breakthrough in unlocking EpCAM as an ADC target positions Varseta-M as a company-building asset over the near and long term. We see multiple layers of value creation potential for CytomX through the advancement of Varseta-M.

In colorectal cancer, which I'll now refer to as CRC, our goal is for Varseta-M to become a core component of the standard of care, including in earlier line therapy. Metastatic CRC remains one of the largest areas of unmet need in oncology today, which really underscores the urgency we feel at CytomX to progress Varseta-M towards the market as rapidly as possible. Commercially, in the late line setting alone, this represents a multi-billion-dollar market. In addition to the very substantial opportunity in CRC, we also plan to capitalize on our leadership in EpCAM targeting by developing Varseta-M in other cancers and ultimately as a pan-tumor therapy. Varseta-M has the long-term potential to positively impact the lives of so many people with cancer, and we are focused on executing with urgency to rapidly progress this potential therapy to regulatory approval.

CytomX has made a very strong start in the clinic with Varseta-M. In our most recent phase I data update in March this year, we shared updated efficacy data in late-line metastatic CRC, showing a confirmed overall response rate between 20% and 32% and approximately 7 months of median progression-free survival. These data position Varseta-M as a potentially transformative step forward in the treatment of metastatic CRC, where currently available therapies offer overall response rates only in the low single digits and just a few months of PFS. Varseta-M is working exactly as designed, and it's unlocking the true potential of EpCAM for the first time. With Varseta-M, CytomX is bringing the power of the ADC class to colorectal cancer. I want to really underscore here that we've achieved something very significant with our Probody platform technology.

In our view, and based on our preclinical data and efforts of others over many years, we believe we can say with confidence that a conventional unmasked ADC targeting EpCAM would have no chance of achieving dose levels that deliver meaningful anticancer activity due to severe on-target toxicities. In contrast, with Varseta-M, we have achieved remarkable anticancer activity in one of the hardest to treat cancer types. We firmly believe we have done the hardest experiment first by focusing initially in CRC and that the best is yet to come. In terms of key near-term objectives for Varseta-M, we are currently in dose optimization with the goal of advancing into a registrational study in late-line CRC in the first half of 2027.

Today, we're very pleased to share that we have completed enrollment in the ongoing dose optimization cohorts with 40 total patients now enrolled across the 8.6 and 10 mg/kg doses, taking total enrollment across the Phase I study to 113 patients. We remain well on track for an update before the end of this year as we work towards prioritizing one of these two doses of this highly active drug candidate for our first pivotal study. In evaluating the potential registrational study dose, we're focused on optimizing the risk-benefit of Varseta-M, building on the significant learnings in the dose escalation, expansion, and optimization phases.

Regarding Varseta-M safety, we have been highly encouraged by the preliminary results we shared in March from dose optimization that show that updated patient management strategies have the potential to substantially reduce the rate of high-grade diarrhea we saw earlier in phase I development. It's something we feel confident we can get an increasingly well-developed understanding of as we move forward through the optimization cohorts and beyond. Typically, patients respond very well to management. Our overall discontinuation rates are low, accounting for the impressive progression-free survival data we have shared to date. In terms of our next clinical communication, we expect to provide an overall phase I data update, including safety and efficacy from the monotherapy dose optimization in the second half of this year.

We expect these data, along with FDA interactions in 2026, to inform Varseta-M monotherapy dose selection and the first registrational study design. Our primary goal with Varseta-M is initially to develop in the late line, where we see this drug candidate as highly differentiated and frankly, as offering a highly impactful new option for CRC patients. Over time, our vision for Varseta in CRC is to replace systemic irinotecan in the treatment paradigm and potentially to displace chemotherapy entirely. Accordingly, and in parallel to its development as a monotherapy in CRC, we are aggressively advancing Varseta-M into combination studies to enable earlier line utilization. Strategically, we see an enormous opportunity for Varseta in early-line CRC. To access this opportunity, we have initiated a combination with bevacizumab as a first step to moving Varseta into earlier line therapy.

Anti-VEGF antibodies, including bevacizumab, are extensively utilized in early and late-line CRC treatment, so this will be a foundational combination. Varseta-M doses assessed in combination with bevacizumab will include both every 2 weeks and every 4 weeks schedules to align dosing with the approved 5 mg/kg every 2-week schedule standardly used in the clinic today. We expect initial clinical data for this combination by the first half of 2027. We're also accelerating plans to study Varseta in combination with chemotherapy, and we plan to begin a phase I/II chemotherapy combination study in the second half of 2026, evaluating Varseta in combination with bevacizumab, 5-fluorouracil, and leucovorin, with the potential to advance into the first and second lines.

In addition to our work in colorectal cancer, we are on track to begin phase I expansion cohorts in additional EpCAM expressing indications in the second half of 2026. We look forward to providing an update on the initial non-CRC indications later this year, with the goal of generating clinical data supporting Varseta-M's ultimate pan-tumor potential. Turning now to CX-801, our masked interferon alpha-2b program, which is currently in phase I development for advanced checkpoint refractory melanoma. Our vision here is for CX-801 to become a new centerpiece for combination cancer immunotherapy as we harness and redirect the power of this cytokine to reprogram and activate antitumor immunity. We initially see CX-801 as well-positioned to address the high unmet need in PD-1 refractory melanoma, where response rates to approved standard of care remain in the single-digit % with limited treatment options available or in clinical development.

interferon alpha-2b is a potent cytokine that has validated clinical activity in melanoma and other cancers, and our initial translational data from phase I suggests that CX-801's mechanism of action is working as designed in the tumor microenvironment. Importantly, our data shared at SITC in 2025 are highly supportive of our strategy for combining with the checkpoint inhibitor KEYTRUDA. Our ongoing CX-801 phase I monotherapy dose escalation study has advanced to the 4th dose level, which exceeds the approved clinical dose of unmasked interferon alpha-2b. CX-801 has been well-tolerated to date, suggesting that our masking strategy is broadening the therapeutic window as designed. Combination dose escalation with KEYTRUDA is also progressing very well and is now actively enrolling in the 3rd dose level.

Overall, we view CX-801 as very well-positioned to address a significant unmet need in advanced melanoma, and we look forward to sharing initial clinical data by the end of this year. With that, I will now transition back to Chris.

Thank you, Sean. Reinforcing Sean's earlier sentiment, we kicked off 2026 from a position of strength, not only with Varseta-M's encouraging data, but with the financing completed in March, a strong balance sheet that enables us to continue to execute against the significant value creation potential of Varseta and the Probody platform. CytomX is in a strong financial position with projected cash runway to at least the second half of 2028 and the potential to achieve multiple milestones. Of note, our runway guidance does not include any supplemental milestones from existing collaborations or any new business development. Importantly, we expect our current cash position will enable us to advance Varseta-M into a registrational study in late line CRC. Also deliver safety and efficacy data for Varseta-M in combination with bevacizumab, as well as Varseta-M data in combination with chemotherapy.

Deliver initial clinical data for Varseta-M in indications beyond CRC. Based on these opportunities, which have the potential to yield significant long-term commercial potential, we expect our capital allocation to be highly focused on Varseta-M over the near to medium term. With that, on the walk through our first quarter financial results. As of March 31, 2026, we ended the quarter with $346.7 million in cash equivalents and investments, versus $137.1 million in cash as of December 31, 2025. Looking at revenue and operating expenses for the quarter, total revenue was $10.3 million, compared to $50.9 million in the first quarter of 2025. The decrease in revenue was primarily attributed to the completion of obligations in 2025 under collaborations with Bristol Myers Squibb and Amgen.

Operating expenses for the first quarter were $29.8 million, compared to $28.3 million in the first quarter of 2025. R&D expenses were $19.2 million during the first quarter, representing an increase of $0.4 million versus the first quarter of 2025, primarily due to increased manufacturing activities for Varseta-M, partially offset by $1.8 million in restructuring expense incurred in the first quarter of 2025. G&A expenses increased by $1.1 million during the three months ended March 31st, 2026 to $10.6 million, compared to $9.4 million for the corresponding period in 2025, which included $1.1 million of one-time restructuring expenses.

As we move throughout the remainder of 2026, we will continue to be disciplined in our capital allocation and advancing the highest Varseta-M priorities for patients and CytomX stakeholders. With that, I'll turn the call back to Sean for closing remarks.

Thanks, Chris, and thanks, everyone, for joining us today. We're very proud of the remarkable progress we've made with Varseta-M, and we're now in the privileged position of bringing the transformative potential of an EpCAM-directed antibody drug conjugate to colorectal cancer patients. We look forward to providing additional updates as the year progresses and as the development program for Varseta-M broadens substantially. We also remain focused on the advancement of the clinical program for CX-801, with the initial goal of delivering a more effective treatment option for patients with advanced melanoma. Before I conclude today's call, I want to sincerely thank and recognize the patients who join our studies, their families, our clinical investigators, and our dedicated CytomX team. With that, operator, let's go ahead and open up the call for Q&A.

Certainly. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile our Q&A roster. Our first question will come from Paul Jeng of Guggenheim. Your line is open, Paul.

Thanks for taking the question. For Varseta-M, can you just talk a little bit about the scope of the clinical update you'll have in the 2nd half? You know, will some or most of the dose optimization cohort patients have sufficient follow-up for PFS? Do you plan to break down responses by subgroup, such as, you know, 3rd line versus 4th line plus therapy? How are you thinking about initial disclosures of overall survival from the study? Thanks very much.

Yeah. Thanks, Paul, for the questions. We are expecting that the update in the second half will be fairly substantial. As we've mentioned today, we've now enrolled 113 patients across the dose escalation, expansion and now optimization phases of the study. This is a very rich data set that is emerging for our first evaluation of Varseta-M in CRC patients. In terms of the update, it will be across the entire study. It will include data from the full 40-patient optimization phase. Yeah, we expect to have, you know, reasonable follow-up in terms of safety and efficacy for the optimization patients, including I would think an initial estimate of PFS.

As you'll recall, last year, our guidance as we came through the second half of 2025 was that we wanted to communicate data this year when it was mature and meaningful, and that continues to be the case and continues to be our philosophy. In terms of subgroups, yeah, we'll certainly communicate the demographics of the patient population that we're enrolling. We do expect it to look quite similar to the patient population that we enrolled in the escalation and expansion phases. And I wanna emphasize that one of the really differentiating and distinguishing features of Varseta-M as a drug for colorectal cancer is that we can treat every patient. We're not selecting patients. We don't need to select patients.

This really is a drug for all comer late-line CRC, and we see this as potentially a huge competitive advantage as we move the drug toward the market. In terms of the third component of your question on overall survival, yes, we absolutely anticipate having or providing, if you like, a first look at OS in this update in the second half of the year.

Great. Thank you very much.

Our next question will be coming from the line of Edward Tenthoff of Piper Sandler. Your line is open, Edward.

Great. Thank you very much, really excited for more data looking in the back half. I just had 1 quick clarification question on the 1-2 chemo combo. Will that be triplet? Will you have AVASTIN or I guess quadruple with the 2 chemos, and will that include AVASTIN? Do you need any of the AVASTIN combo data to start that, you know, chemo combo trial? I just want to make sure I understand that correctly.

Yeah. Hi, Ted. Thanks for the question. Taking the first question first, in terms of the nature of the combination, yeah, we absolutely will want to evaluate the Varseta-M plus chemo plus Bev combination. We will want to look at that. Right now, we don't see the data from the ongoing 20, sorry, Varseta-M plus Bev, as gating necessarily to starting that work in the second half.

Yeah.

We do of course see that Bev combination work. The Varseta-M Bev combination is going to be really important to further down the road, considering from a registrational study perspective, the design of that study, if indeed we do at some future point, decide to compare Varseta-M plus Bev against other comparator arms. We do plan to look at that triplet in the chemo combination later this year.

Yeah. Then that's really helpful. Then when it comes to the new EpCAM-positive tumors, I'm really excited to hear what your thinking is. Maybe you can share with us now kind of what goes into some of that prioritization, 'cause there's a lot of different places you could go. Thanks.

Yes, there are so many places we could go because EpCAM is such a broadly expressed cancer target on so many solid tumors. We do have a lot of opportunities to work through and prioritize. It's not lost on us, of course, or really anybody else that there are some, there's quite a number of, if you like, adjacent GI tumors.

Yeah

that can make a lot of sense to evaluate with Varseta-M. There are also many others. Something that we continue to work through and prioritize, and we will communicate more specificity on exactly what we're planning to do in the second half.

Great. I'm looking forward to it and, more data. Keep up the great work.

Thanks, Ted.

Of Anupam Rama of J.P. Morgan. Your line is open.

Hey, guys. This is Joy on for Anupam. Thanks so much for taking our question. I think previously you had said you were targeting mid-year FDA interactions to start discussing the pivotal trial design. To what extent is reaching alignment on the trial design ultimately gated on seeing your dose optimization update later this year? I assume you can start having those conversations with FDA now with your initial data on hand. Just how should we think about the update later this year in terms of solidifying your registrational strategy? Thanks.

Yeah, thanks. Great, great question. Really important question. I'll start by saying that we're just really excited to have this dialogue with FDA as we progress through the year. We anticipate multiple interactions, we do expect that the data from the optimization cohorts will be central to those conversations in relation to dose selection for the first pivotal study. That's, of course, a large part of the reason we're doing these additional 2 N equals 20 cohorts at the 8.6 and 10 mg/kg doses is to generate data to satisfy Project Optimus and you have as highly productive a conversation with FDA as we can.

Yes, that data will be important, and that's why we're guiding that really towards the end of the year or by the end of the year. The next comprehensive update that we plan to provide will not only include, of course, data across the 130-13 patient phase I study, but will also include guidance as to where we're going next in terms of design of the first pivotal study, what the patient population is, what the comparator arm is, and of course, what the dose is.

Our next question will be coming from the line of Roger Song of Jefferies. Your line is open, Roger.

Hey, thank you, team, for taking our questions. Congrats on the progress. This is Nabil on for Roger. Maybe, one for me first. Just on the 8.6 versus 10 mg/kg, just a little bit curious if you could maybe give some color on the dose decision log-logic, because we saw the headline OR 32% versus 20%. What is the framework that you guys would apply to finally lock in on a dose? Is it related to tolerability at this point? We noticed in the exposure response model, it looks like there's pretty similar efficacy. Are you weighing depth and durability? Are you weighing safety more? Thank you.

Yeah. Thanks, Nabil. That's obviously, there's a lot in that question in terms of the work that we are doing in real time and will be continuing to do as we move through the year to lock in on the go-forward dose. You know, first thing I'll say is we think we've got two, you know, two great choices here in terms of the 8.6 and 10 mg/kg doses, both of which, as you'll recall, we're currently evaluating on an adjusted ideal body weight basis in the context of the dose optimization cohort. We're gonna learn a lot as the year goes by as to the performance of these two doses, of course, in terms of efficacy, also in terms of safety.

On efficacy specifically, as we've been discussing, you know, for quite some time now, we do anticipate that at least our base case for our first registrational study, we do anticipate that OS will be our primary endpoint. That of course means that ORR is really an important metric here for how the drug's performing, and this drug is performing extraordinarily well. As you said, 20% ORR at 8.6, 32% at 10 mpk. That is remarkable activity. But we also have remarkable PFS of 7 months as reported on March 16th.

We are very keen to see how that translates into OS as the data matures, with OS of course, as I just mentioned, being our primary most likely primary in the go-forward pivotal study. You know, we'll see. We'll see how these two doses deliver in terms of all of these different metrics, and we'll choose accordingly.

Excited to see that as well. Thank you.

You're welcome.

Our next question will come from the line of Olivia Brayer of Cantor Fitzgerald. Your line is open, Olivia.

Hi. Good afternoon. Thank you for the questions. For that second half data disclosure, can I just clarify that you guys plan to break out tolerability and efficacy for those 40 patients specifically in the optimization cohort? If so, will we still get PFS and potentially even an early look at some OS data from those patients specifically? From a timing perspective, top line second half of this year, does that mean you'll likely follow it up with a presentation at a medical conference sometime in early 2027? I've got one quick follow-up on the new formulation with Bev.

Yeah. Thanks, Olivia. Yeah, obviously the 40-patient optimization cohort is of high interest to us and others. We absolutely plan to report the full safety picture, which we gave an early look at in the March 16th disclosure. We gave an early look at the first 2 months of the experience, which was being, you know, very encouraging. We plan to give a similar look for the full 40 patients by the end of the year together with efficacy. As I've already mentioned, you know, PFS would certainly be a goal there to have PFS for those 40 patients. I think OS is going to be too early.

You know, we're just, as we reported today, we've completed enrollment, that's been relatively recent, so I think OS is gonna be immature. We do anticipate having OS from the escalation and expansion phases, which I think will be particularly telling, because remember that in those, in those patients, those first escalation and expansion patients, we had not optimized our adverse event management plan, but we were still able to deliver 7 months of PFS, and we're optimistic that we'll have an encouraging OS number as we get to report that later in the year. In terms of, you know, venue for data updates, you know, we do think a medical meeting this year is on the cards.

Certainly as we move into 2027, additional medical meetings, we're of course, keeping our options open.

Okay. Very helpful. Then for the combination with Bev, is there anything you guys can tell us at this point about the formulation work that you've done to get Varseta-M administered as an every two and four week dosing schedule instead of every three weeks? Is there any data that you'll be sharing there at some point?

There's no real formulation work that needs to be done. It's simply an adjustment of the schedule from Q3 to Q2 and then accordingly to Q4. That's to match the, as I just mentioned on the call, that's to match the established clinical use of Bev in the FOLFOX, FOLFIRI setting on a 2-week schedule. There's no additional formulation. It's simply a question of adjusting the frequency of dosing to match the use of bevacizumab in the marketplace today.

Okay. Thanks, Sean. Appreciate it.

You're welcome.

Our next question will come from the line of Matt Biegler of Oppenheimer. Your line is open, Matt.

Hey, guys. Thanks for the question. Just kinda curious how you're seeing the emerging competitive profile here of Varseta-M versus the other ADCs that are also in development, PresymTCT, being 1 of them. I guess more importantly, do you think this is like a winner takes all, zero-sum game here with the topo 1 base ADCs? Do you think different patients might get different ADCs depending on, you know, certain health status, et cetera? Thanks.

Thanks, Matt. Well, we certainly don't see this as winner takes all by any means, and I think that would be a very unusual scenario for an oncology drug in this class in an area of unmet need like this. I mean, our thinking is very different on that, on that question. First of all, with regards to Varseta-M, we have a, we have a first-in-class anti-EpCAM antibody drug conjugate. I, again, I really can't emphasize how important it is to realize that we've done something really, really, I'll use the word special with our technology to unlock the potential of EpCAM for the first time with our Probody therapeutic platform. Secondly, we really do believe that Varseta-M has the potential to be the best-in-class ADC for colorectal cancer.

This drug is highly active. It's highly active in terms of its response rate. It's highly active in terms of its progression-free survival, and we'll see what it can deliver in terms of overall survival as we move forward. This is a very active drug, and we believe does have the potential to be best in class. We're going all out with this drug to get it to the market as quickly as we can. We think it's highly competitive, and we think there's a ton of value to build in our company with this drug. Most importantly, an enormous amount of benefit to bring to these patients.

Thanks.

As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. Our next question will be coming from the line of Mitchell Kapoor of H.C. Wainwright. Your line is open, Mitchell.

Hi. Thank you for taking my question. This is Jan Zi sitting in for Mitchell. With the enrollment now complete in the 40-patient dose optimization cohort, can you give any update on whether grade 3 or higher diarrhea in the optimized, adjusted ideal body weight plus prophylaxis population is still tracking closer to that initial 10% rate that was seen in the first 20 patients? Or whether it's moved closer to something like the historical 25%-30% range at the 8.6 and 10 mg/kg as follow-up has occurred?

Well, no new data today. That data will be coming. We obviously were highly encouraged by the initial data we presented on March sixteenth from the first couple months of follow-up of the first 20 patients enrolled into the optimization cohorts with a rate of grade 3 diarrhea of 10%. I think we commented at the time, and we've been very consistent about this over the last few months, that, you know, our objective is, of course, to manage the rate of grade 3 to the best of our ability with this updated AE management strategy that includes upfront use of loperamide and budesonide. It appears to be performing very well as of that first data update, and we're encouraged to see additional data now from the full 40 patients.

That data will be shared later in the year. Our goal overall is to manage the grade 3s into the 10%-20% range. You know, that we think is really the target. That's based on our own research. It's based on a lot of conversations we've had. Quite honestly, a lot of work has been published and presented by others over the last, you know, six or so months. We feel we're very much on track, as I said in my prepared remarks, to get a strong handle on that particular aspect of the Varseta-M program.

I see. Thanks. Curious also if for an optimized regimen, how standardized is prophylaxis in practice? Do you see any implementation friction that could matter in a community oncology setting if, for example, Varseta-M moves earlier in late-line CRC?

We really don't. You know, the upfront work that we're doing right now with these optimization cohorts is absolutely intended to, you know, to pin down a prophylaxis strategy that will be readily translated into the community setting as we move into our first pivotal study and, of course, as we bring the drug to the market. It's a good question. It's an important question, and it's one that we've asked ourselves, and that is again, just to restate a big part of why we're doing this upfront optimization work right now. Right now, we don't see any challenges with the translation, if you like, of this updated AE management plan into a larger number of sites and ultimately into the commercial marketplace.

Thank you so much. I'm looking forward to the next update.

Thank you.

You're welcome.

I'm not showing any further questions in the queue. I would now like to turn the call back to Dr. Sean McCarthy, Chairman and CEO, for closing remarks.

Thank you. Again, I'd just like to thank everyone for joining us today. We're very excited about our progress here. I hope that comes across. We really look forward to providing additional updates as the year progresses.

And this concludes today's program. Thank you for participating. You may now disconnect.

Good morning, everyone. Thank you for standing by. Welcome to the CytomX Therapeutics 2025 Financial Results and Varseta Phase I Dose Expansion Data Call. Please be advised that today's conference is being recorded. I would now like to hand the conference call over to your host for today, Chris Ogden, CytomX Chief Financial Officer. Please go ahead.

Thank you. Good morning, and thank you for joining us. Before we begin, I would like to remind everyone that during this call, we'll be making forward-looking statements. Because forward-looking statements relate to the future, they're subject to inherent uncertainties and risks that are difficult to predict and many of which are outside of our control. Important risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future developments, or otherwise. Earlier today, we issued a press release that includes a summary of our 2025 financial results and progress at CytomX. Additionally, this morning, we are excited to announce positive phase I dose expansion data for Varseta-M in patients with late-line colorectal cancer.

The focus of our call today will be the phase I expansion data update for Varseta. For details on the company's 2025 financial results and other pipeline updates, we encourage everyone to read today's press releases and the associated materials which have been filed with the SEC. Additionally, the press releases, a recording of this call, and our SEC filings can be found under the Investors and News section of our website. With me on the call today are Dr. Sean McCarthy, CytomX's Chief Executive Officer and Chairman, and Dr. Wayne Chu, CytomX's Chief Medical Officer. Sean will provide introductory remarks regarding the clinical data and Varseta program strategy, and Wayne will then walk through the clinical data. We will then wrap up with concluding remarks in a Q&A session. With that, I'll now turn the call over to Sean for opening remarks.

Thanks, Chris, and good morning, everyone. It's really a pleasure to be here with you all. The major focus of today's discussion will be an exciting update on phase I data for our EpCAM-targeting Probody antibody-drug conjugate Varsetatug Masetecan, otherwise known as Varseta-M or Varseta. There's been a very high level of interest in this program since our first data disclosure in May last year, in which we shared a strong start with the clinical development of this first-in-class ADC for colorectal cancer. We'll refer to colorectal cancer during this presentation as CRC. In today's update, we want to share the terrific progress we have continued to make over the past 10 months. We continue to be highly encouraged by what we're seeing, and we aim to develop Varseta-M aggressively for the benefit of patients with CRC and over time, many other cancers.

In this presentation, we aim to address key questions that relate to the next steps in the development of Varseta, specifically the drug's efficacy profile across a larger patient data set, improving our understanding and management of gastrointestinal adverse events, and how we are integrating all of this data into future dose selection as we lock in on plans for late-stage development and registration. Okay, let's get to it. Colorectal cancer remains one of the biggest unmet needs in oncology. 1.9 million patients per year are diagnosed around the world, and that's predicted to grow to more than 3 million patients by 2040. CRC is the second leading cause of cancer death worldwide and is growing in incidence in younger patients. Five-year survival in patients with metastatic CRC is a dismal 13%. We see colorectal cancer as one of the largest untapped solid tumor markets.

This cancer type has been largely bypassed by the last 20 years of oncology innovation and progress. Antibody-drug conjugates have transformed the treatment of many tumors, initially hematologic cancers and increasingly solid tumors. We're seeing ADCs coming earlier in the treatment paradigm, increasingly showing opportunities to replace systemic chemotherapy in a variety of tumor types. There is no approved ADC for the treatment of CRC. Varseta-M is bringing the potential and the power of antibody-drug conjugates to colorectal cancer. CRC is a very large market opportunity. In the third-line setting alone, there are projected to be 45,000 addressable patients in the U.S. by 2040, creating a multibillion-dollar potential market opportunity.

While the unmet need is greatest in the later line setting, the entire treatment paradigm for this cancer could be changed by a pan CRC ADC with the potential to move to earlier lines of therapy like Varseta-M. The current standard of care in late-line metastatic CRC is highly inadequate. The options available today for patients result in objective response rates in the low single digits and progression-free survival of two to five months. These agents are unfortunately the best that are currently available for the treatment of patients after they have exhausted chemotherapy-based regimens. We must do better, and I'm pleased to say we are doing better by bringing CytomX innovation to bear on this problem. Varseta-M was intentionally designed to be active in CRC.

We carefully selected the right target and the right payload, and we have uniquely unlocked this opportunity with our Probody therapeutic platform. Varseta-M targets EpCAM, epithelial cell adhesion molecule. It's been known a long time that EpCAM is present at very high levels on colorectal cancer. In fact, it was first identified as a CRC marker. EpCAM is uniformly and highly expressed across all stages of the disease. There have been many efforts to target EpCAM previously. The major challenge has been it's present on most normal epithelial structures. So approaches to target EpCAM in the past have hit significant toxicity roadblocks very early in their development because of EpCAM expression in normal tissues. Based on these prior unsuccessful efforts, and as also shown by our own preclinical experiments, a conventional ADC targeting EpCAM would not be expected to be developable.

Varseta-M is designed to unlock EpCAM as an ADC target and is based on a high-affinity anti-EpCAM antibody, which we have masked using CytomX's protease-dependent peptide masking Probody strategy designed to minimize binding in normal tissues. The mask is removed by proteases within the tumor microenvironment, allowing binding and engagement with the target and delivery of the effector mechanism and anticancer activity. The antitumor effector in Varseta-M is a novel topoisomerase I payload called CAMP59 that we licensed from ImmunoGen. The linker is also novel, a tri-alanine cleavable peptide linker optimized for bystander effect. We now refer to this TAL-CAMP59 linker payload as mazatecan. Varseta-M has a drug antibody ratio of eight. We really believe with this drug candidate, we have the right target and the right payload with this overall strategy being uniquely enabled by the CytomX Probody platform. Where are we with the phase I study?

Shown here is the current enrollment status. As we reported in August last year, enrollment into the dose escalation and expansion phase at that time had reached a total of 73 patients. This included 60 patients treated at the prioritized expansion doses of 7.2 mg.kg, 8.6 mg/kg, and 10 mg/kg administered every three weeks. The updated efficacy data we're sharing today is focused on these expansion cohorts, for which we now have meaningful follow-up and from which we expect our go-forward dose for the first registrational study will be selected. In Q4 last year, we increased enrollment into the phase I study with the goal of further dose optimization. As of a data cutoff of January 16th, 2026, enrollment across the study had reached 93 patients.

The additional 20 patients enrolled are the first 20 of a target of 40 patients being enrolled in dose optimization cohorts. Dose optimization is focused on the top two doses from the expansions, 8.6 mg/kg and 10 mg/kg, and encompasses adjusted ideal body weight dosing and an updated prophylaxis strategy that Wayne will walk you through shortly. Today, we'll share safety data across the full 93 patients, showing the progress we're making in adverse event management and specifically the management of treatment-related diarrhea, for which we believe we are making excellent progress. We are very excited today to share updated results from the ongoing phase I study of Varseta-M in late line CRC. This drug candidate continues to perform extraordinarily well.

Antitumor activity continues to be very strong, with a 32% confirmed overall response rate at 10 mg/kg and a 20% confirmed overall response rate at 8.6 mg/kg. Our current estimate of preliminary progression-free survival has improved from 5.8 months in May of 2025 to 6.8 months-7.1 months. We've also made excellent progress in understanding and managing the safety profile of Varseta-M. We continue to see no evidence of the classic EpCAM toxicities that have limited previous efforts to drug this target. Importantly, through the use of further updated prophylactic strategies, we can report today a rate of grade 3 diarrhea of 10% in early dose optimization cohorts. Simply put, we believe we have an important potential new treatment for colorectal cancer that has been uniquely enabled by our core platform technology.

This is a major landmark for our company and most importantly, of course, a big step forward for patients. Our top company priority is now to move Varseta forward aggressively into its first registrational study. With that, let me hand over to Wayne to talk you through the details of the data.

Thanks, Sean. Going into the data from the ongoing phase I trial. This slide summarizes key baseline characteristics among all 93 patients who are enrolled in the dose escalation, expansion, and dose optimization cohorts. Consistent with what was previously reported, the study population continues to be representative of a late-line metastatic CRC population, highlighted by the fact that most patients received at least three prior lines of anticancer therapy. Almost half received at least four lines of prior therapy, and over a quarter received prior bevacizumab plus Lonsurf. Three-quarters of patients had liver metastases at baseline, and the majority of patients had KRAS-mutated tumors. Finally, most patients' tumors were microsatellite stable, with only one patient with known MSI-high disease.

The following slides describe efficacy from the 60 patients treated in dose escalation and dose expansion cohorts at Varseta-M doses between 7.2 mg/kg and 10 mg/kg administered on an every three-week schedule. In the updated waterfall plot, Varseta-M continues to show striking antitumor activity and disease control across the three dose levels, highlighted by tumor reductions, including confirmed objective responses per RECIST 1.1 criteria. Objective responses were higher at the 8.6 mg/kg and 10 mg/kg dose level, with confirmed objective responses observed in 20% and 32% of patients respectively. The arrowheads indicate patients who were still on study treatment at the time of the data cut, and at the bottom of the slide is patient-level information with respect to key baseline characteristics.

As you can see, antitumor activity was observed in patients with KRAS mutated or KRAS wild-type tumors and in patients with or without liver metastases. Finally, consistent with what was previously reported, EpCAM expression as assessed by immunohistochemistry on baseline tumor biopsies remains uniformly high, with an H-score of 300 being the maximum value. All evaluable tumors had IHC H-scores greater than 200, with the vast majority having H-scores of at least 250. This is the updated spider plot characterizing changes in tumor burden over time. As previously reported and further substantiated with a longer median follow-up time of over eight months, Varseta-M continues to provide impressive durable disease control. A total of 16 patients were continuing Varseta-M treatment at the time of the data cut-off, with several patients having ongoing treatment in excess of 11 months.

With the observed durable objective responses and disease control, we continue to observe progression-free survival at all three dose levels that compare very favorably with those of currently approved therapies in late-line CRC. Notably, the median PFS of Varseta-M treatment was 7.1 months at the 10 mg/kg dose level and 6.8 months at the 8.6 mg/kg dose level. Given the follow-up time and the proportion of patients who were censored at the time of the data cut, the PFS estimates will continue to mature with the potential for further improvement. Furthermore, the PFS estimates shown here are in the absence of dose optimization, which, as we will now show, has the potential to improve the safety and tolerability of Varseta-M.

Turning our attention to safety, to contextualize the safety data that will be presented in the upcoming slides, I wanted to summarize some of the key observations and learnings from the phase I dose escalation, expansion, and dose optimization cohorts as the basis for late phase dose selection. Key early observations during dose escalation indicated a manageable safety profile with Varseta-M in that no dose-limiting toxicities were observed. Importantly, dose-limiting toxicities observed with other EpCAM-directed therapies, such as pancreatitis and severe liver toxicities, were not observed with Varseta-M. Also of note, interstitial lung disease, which has been observed with other TOP1 ADCs, was not observed with Varseta-M. In addition, rates of hematologic toxicity were relatively low.

Finally, consistent with the mechanism of action of topoisomerase I inhibitors, diarrhea was the most frequently observed treatment-related adverse event and early on was identified as the main adverse event of interest. As we conducted dose expansion across the three dose levels from 7.2 mg/kg to 10 mg/kg, the overall safety profile was consistent with what was observed during dose escalation in that no new safety signals were identified. We focused on understanding key drivers of treatment-related diarrhea and gaining important experience with diarrhea mitigation strategies, particularly with respect to grade 3 diarrhea as the highest grade observed to date. Initially, a strategy of recommending loperamide prophylaxis for patients at high risk of developing diarrhea was introduced. For reasons related to physician practice patterns, patient preferences, and the rapidity of enrollment into dose expansion, loperamide prophylaxis was not utilized extensively in the initial expansion phase.

We nevertheless gained important insights regarding loperamide pretreatment to reduce rates of severe diarrhea. We also gained valuable experience with the oral corticosteroid budesonide as an additional approach to manage diarrhea, where 12 of 14 patients who had grade 2 or grade 3 diarrhea experienced at least a one-grade reduction in severity after budesonide was started. Finally, a thorough analysis of Varseta-M pharmacokinetics and exposure-response supported dosing based on adjusted ideal body weight to reduce interpatient variability. The observations and learnings across dose escalation and dose expansion have been incorporated in the ongoing enrollment of patients into dose optimization cohorts, where Varseta-M is administered at 8.6 mg/kg or 10 mg/kg based on adjusted ideal body weight and mandatory dual prophylaxis with loperamide and budesonide for all patients, regardless of preexisting risk factors, has been implemented.

As we will now show, early safety data from the dose optimization cohorts indicate meaningful reductions in severe diarrhea. From the dose escalation expansion cohorts, we observed that treatment-related adverse events occurred early during Varseta-M treatment, exemplified by the observed median time to onset of grade 3 diarrhea of approximately five weeks. The tornado plot shows treatment-related adverse events in the first two months of Varseta-M treatment at the 8.6 mg/kg and 10 mg/kg dose levels, comparing the 42 patients treated in dose escalation and expansion cohorts on the left with patients treated in dose optimization cohorts on the right. Patients with at least two months of on-treatment follow-up were included in this analysis. This ensures equal comparison between the two groups based on an identical follow-up observational period and is representative of the overall toxicity profile, reflecting the relatively early onset of treatment-related adverse events.

Treatment-related adverse events within the first two months of Varseta-M treatment among patients enrolled in dose escalation and expansion is highlighted by grade 3 diarrhea, which was observed in 29% of patients. In contrast, among patients enrolled into dose optimization cohorts, grade 3 diarrhea was observed in only two of the 20 or 10% of treated patients. Notably, the decreased incidence of grade 3 diarrhea with dose optimization is paralleled by a similar reduction in the incidence of grade 3 hypokalemia, which is a known consequence of fluid and electrolyte imbalances caused by diarrhea. Overall, while early, the data to date indicate that dose optimization may lead to an improved overall safety profile, highlighted by reductions in the incidence of grade 3 diarrhea and grade 3 hypokalemia.

Taking a step back from comparisons of the adverse event profiles between the dose escalation and expansion and dose optimization cohorts, the overall treatment-related adverse event profile across all cohorts and dose levels is summarized in this table. These data are consistent with the safety profile that was described previously and only partially reflects the safety profile with ongoing dose optimization. Across the safety data from these cohorts, dose escalation, expansion, and dose optimization, treatment discontinuations for related adverse events were low at 11%. With additional patient enrollment and longer follow-up, we are optimistic that measures incorporated into dose optimization will result in a more favorable Varseta-M safety and tolerability profile, maximizing clinical benefit for patients. Updated pharmacokinetic data of Varseta-M is summarized here.

The data are from the 73 patients treated in dose escalation and expansion cohorts and does not include data from the dose optimization cohorts where Varseta-M was dosed based on adjusted ideal body weight. The data continue to support key characteristics from earlier observations in that, as shown in the figure, PK is dose proportional. We also observed interpatient variability, which we aim to reduce with adjusted ideal body weight-based dosing. Varseta-M circulates primarily in the masked form. The mean Varseta-M half-life of six to eight days is consistent with that of other in-class antibody-drug conjugates, and unconjugated CAMP59 concentrations in circulation are low, constituting approximately 1%-3% of total Varseta-M.

Turning our attention to efficacy, the potential impact of Varseta-M dosing with adjusted ideal body weight on efficacy is illustrated in this figure, which shows the relationship between Varseta-M exposure and efficacy as measured by the clinically relevant metric of landmark six-month progression-free survival. The modeled exposure and response relationship based on clinical and PK data from dose escalation and dose expansion encompasses the exposure range for the 8.6 mg/kg-10 mg/kg dose levels. Notably, observed Varseta-M concentrations at 8.6 mg/kg and 10 mg/kg with adjusted ideal body weight dosing fall within this exposure range, indicating that doses tested in the dose optimization cohorts are predicted to deliver similar efficacy to the corresponding non-optimized dose levels, where median PFS, as described earlier, has been shown to exceed six months.

As you can see, as we gain an even deeper understanding of our Varseta-M efficacy and safety, this model gives us confidence in the range of dose levels as we work towards discussions with FDA on dose selection based on Project Optimus principles and finalizing registrational study plans. It has been a pleasure sharing this data with you today. With that, I turn it back to Sean for concluding remarks.

Thanks, Wayne. We're super excited about our continued progress with Varseta-M. This drug candidate is working exactly as designed, and we believe we can make an enormous difference for many, many cancer patients. This is the first and only antibody-drug conjugate targeting EpCAM, a target that many have tried to drug before and failed. Our data is truly a validation of our technology and a direct embodiment of our company vision statement of transforming lives with safer, more effective therapies. To restate, we believe we have an important potential new treatment for CRC, and this is just the start. We see Varseta as a company building asset, a pipeline in a product, if you like, that puts CytomX on a value creation trajectory that we believe can be steep and sustained. We see three major layers of value creation being unlocked in the near, medium, and longer term.

Firstly, we aim to rapidly bring this drug to its first approval in late-line CRC, where there are projected to be more than 45,000 addressable patients by 2040. This alone is a potential multi-billion-dollar opportunity in the U.S. Secondly, we aim to bring Varseta-M into early line CRC. In fact, this has always been the vision for this program to potentially replace irinotecan. As we learn more about the overall profile of Varseta-M, particularly the safety profile, we are feeling increasingly confident that we can penetrate into this very large market. Our third layer of value creation is to expand into other EpCAM-positive tumors, of which there are many. Given that we've broken through in CRC, we believe we've done the hardest experiment first. CRC is a very difficult-to-treat cancer, and we're really excited to see what Varseta-M can do in other tumor types.

In the long term, it's not a stretch to envisage Varseta advancing towards a pan-tumor histology agnostic label like Enhertu has for HER2. Moving now to our upcoming milestones. With this updated data, we do believe we have put Varseta and CytomX on a very clear path to value creation through sustained execution. I hope you all see today's update as a highly meaningful step along the way in the development of this exciting drug. There's much opportunity and a lot of work ahead of us. Our top priority right now is the rapid advancement into registrational studies to start in the H1 of 2027. We look forward to sharing additional data from the phase I study, including the dose optimization cohorts and registrational study design in the H2 of 2026.

The strength of our data brings into sharper focus the opportunity to conduct our first registrational study in the third line. We'll be continuing to assess this opportunity as our data matures. In terms of our earlier CRC strategy, we've already initiated phase I assessment of Varseta in combination with bevacizumab, and we anticipate initial data late this year or early in 2027. Furthermore, today, we're also announcing our intention to start combination work with bevacizumab plus chemo by the end of the year. The team is also working very hard to start our first clinical study outside of CRC later this year as well. So really exciting times for CytomX. Thank you all for joining today. Before opening up the call for questions, I really want to thank the CytomX team for doing just such an incredible job.

Varseta has been a long time in the making, and it takes so much dedication and perseverance to do this important work. My colleagues and I thank the patients who have trusted us and participated in this phase I clinical study, and we sincerely thank our investigators for their thoughtful guidance and diligent leadership. At CytomX, we've never been more excited about what we're doing for patients, and we look forward to providing future updates. With that, let's open up the call for questions.

Thank you. To ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Edward Tenthoff with Piper Sandler. Your line is now open.

Great. Thank you very much, and congratulations. Very impressed by these continued response rates and PFS from Varseta. Really cool, and I appreciate all the detail in both the dosing data and also the plans going forward. I guess when it comes to the pivotal trial, appreciating that you'll share design in the H2, how large are you anticipating from this study? And then secondly, could you share any color in terms of what might be leading indications beyond the CRC for the next EpCAM positive tumor? Thanks a ton.

Thanks, Ted, for the questions. With regards to the pivotal study or the first pivotal study, still a work in progress, of course, in thinking about sizing. We're obviously super encouraged and excited by the level of activity that Varseta is bringing in late line CRC. I wanna emphasize, actually, this continues to be a very late line patient population, as you can see from the demographics that Wayne highlighted. We do see that with this updated dataset, as I mentioned, and the PFS in particular continuing to improve, we do feel increasingly excited about the pivotal being in the third line. We of course need to learn about OS, and we'll be sharing OS data as the program matures.

That will be a key determinant of our decision-making on the pivotal design. Too early to say what the size of that study would be, but we think it could be a manageable size and executed very quickly.

Do you wanna comment on potential other indications outside of CRC?

Yeah. With regard to your second question, Ted, on non-CRC, as we've said for some time, we really are, we're really excited about the broader potential of EpCAM. It's expressed in many, if not all, of the solid tumors. We highlight in our presentation have for some time other GI tumors including gastric and pancreatic. Of course, it's highly expressed in lung cancer, ovarian cancer, certain breast cancers. There's a wide range of opportunities here that we continue to work through. To this point, as you'll understand, we've been highly focused in CRC and bringing this drug to its first pivotal study. We're excited to move into other tumor types by the end of this year.

Yeah. Excellent. Well, great work and thanks for sharing all the details.

You're welcome.

Our next question comes from the line of Roger Song with Jefferies. Your line is now open.

Thanks. Then a huge congrats for the data. Very impressive on the efficacy and the tolerability side. Thanks for taking the question. Maybe, Sean, so for the initial dose expansion, this diarrhea kind of prophylactic protocol you said on the call, it was not fully implemented or widely used, and they're now using the dual. How should we think about, you know, the implementation here and then also the real-world use? What is your advice, feedback on this potential regimen for future? Then, in terms of the pivotal also, a quick follow-up on that is that, can comment on this, you know, you say the third line and then the.

Still looking at the OS, how likely this PFS will be the sole primary endpoint given the data is very impressive here compared to the standard of care? Thank you.

Thanks, Roger. Great questions. Yeah, with regard to the expansion phase, one of the things that we've commented on quite frequently over the last six or so months is just how rapidly the expansions enrolled. You know, the demand for the drug, as I think you can now see based on this, you know, what it's doing. The demand for the drug was very high. We enrolled the expansions faster than anticipated. You know, for that and other reasons, the implementation of the original loperamide prophylaxis was not as extensive as we had perhaps anticipated.

There's also a clinical reason for that as well, which is, you know, these patients, particularly in the very late line, of course, they've experienced GI adverse events at various points in their treatment journey. They all have, you know, for the most part, experience with loperamide and it's a drug that while bringing benefit, of course, to the treatment of diarrhea, it comes with its own challenges as well. Patients, you know, they in some cases gonna make their own choices about how they manage that particular drug. Unless it's really impressed upon them to use it.

I would contrast that a little bit to the budesonide, which we've really demonstrated some key learnings in the expansion phase that budesonide is looking to be effective as well. This is a drug that we've experienced that patients are very compliant with. In terms of the prophylaxis overall and its use in the real world, we feel really good that it will be adhered to as we continue to refine and update and learn, you know, how to optimize the overall protocol. In terms of progression-free survival being a primary endpoint, we're not guiding to that. There's no real precedent for that in the late line CRC setting. We are planning for OS to be the primary.

That is something we'll continue to, you know, talk to FDA about. Of course, we are looking at all and any ways to accelerate the development of Varseta-M. For the time being, our assumption continues to be unchanged, that the first pivotal would be principally based on an OS primary. Given the unprecedented level of activity of this drug, we'll continue to look at all and any options.

Thank you so much. Congrats again.

Thank you. Our next question comes from the line of Matthew Biegler with OpCo. Your line is now open.

Oh, great. Thanks, guys so much, and congrats from us as well. Could you comment on positioning relative to the other ADCs in development like Enhertu, especially now with diarrheal prophylaxis seeming to work well? What are like the puts and takes from a physician's perspective in choosing one of the ADCs over the other? Thanks.

Yeah. Thanks, Matt. Really terrific question on the broader landscape. As we've been saying, this is just so exciting for patients, you know, the ADCs are coming to colorectal cancer, and we think we've got a really good one, if not potentially the best. I wanna emphasize again that Varseta-M is a first-in-class anti-EpCAM ADC. It may very well be the best-in-class ADC for CRC based on this data that we're sharing today. This is a highly competitive data set. We believe a highly competitive drug.

I think of particular importance, as you mentioned, the safety profile that we continue to understand and learn how to manage. This is really important because it continues to open up, we think the movement of Varseta into earlier lines of treatment into the first- and second-line setting based on its, we think, potential combinability and effective combinability with the other components of frontline treatment. This is a very important data set that we're sharing today with big implications for where this drug can go. As I said, we will continue to develop the drug aggressively and position. We think we've got a very competitive position against, for example, the AbbVie and Merck KGaA drugs.

Thanks, Sean.

Thank you. Our next question comes from the line of Michael Schmidt with Guggenheim. Your line is now open.

Hey, good morning. Thanks for taking my questions, and congrats on the data from us as well. Obviously the efficacy looks very compelling, despite the fact that you have a very high proportion of patients that are, you know, four prior lines, so fifth-line plus population. I'm just curious if you've looked at the data in third-line only patients. Just curious if you see even further improved activity and something that could look closer to what you'll be enrolling in phase three. A question on diarrhea. Just curious if you could just help us understand a bit more the duration of diarrhea, for example. Is this a first dose effect or something that, you know, patients are having for a longer period of time?

Obviously PFS already looks very good, despite the diarrhea. I'm just curious when you think about the adjusted ideal body weight dosing cohorts, which is, you know, something that's not uncommon for ADCs in general. Just curious if there's an opportunity to further improve efficacy with that dose optimization that's ongoing. Thanks so much.

Thanks, Michael. A series of wonderful questions there. Appreciate that. First of all, in terms of parsing out the patient population and the dataset, you know, I guess this is just continues to be a late line patient population that we think showing this level of activity is a great place to start. We're obviously very optimistic that as we move the drug earlier, the drug will continue to show similar if not even more impressive activity. We're not dissecting the dataset really any more than that at this moment in time. We think it really speaks for itself. In terms of duration of diarrhea, I mean, we've been very focused on time to onset, as Wayne mentioned.

About five weeks is the median time to onset for grade three when we see it. We're now in this position with this updated prophylactic strategy to really get on top of that and get that number down, as you've seen in this preliminary data from dose optimization. Patients treated with this prophylactic regimen, obviously you're seeing a much reduced incidence of grade 3. That's really what we're focused on. In the earlier experience, in the expansion phase, we found that patients are responsive to the treatment with budesonide.

As Wayne pointed out, we saw 12 of 14 patients treated, who we follow closely in the earliest stage of the study, show at least one grade improvement in their diarrhea, giving us that initial clue that budesonide could be a terrific addition to the prophylactic strategy. You make another really important point, Michael, on PFS. These PFS numbers are from the expansion phase, and the expansion phase did not have optimized prophylaxis. We do feel that this data can continue to improve. We do feel that this drug can continue to outperform over time as we learn more about it.

That also relates to your last question on adjusted ideal body weight dosing, which as you correctly point out, is something that has been used for a number of ADCs and shown to be effective. It's really aimed at decreasing the outliers, compressing the dose range so that we have more consistent dosing. That should, we think, just add to our ability to manage the safety profile, keep patients on drug for the maximum period of time, maximizing the duration of their clinical benefits.

All right. Thank you.

Thank you. Our next question comes from the line of Olivia Brayer with Cantor Fitzgerald. Your line is now open.

Hi. Good morning, guys, and my congratulations as well on today's data. Sean, I know you aren't necessarily breaking things out yet by individual treatment line, but anything you can tell us about how many lines of therapy the confirmed partial responses that you had in that 8.6 mg/kg and 10 mg/kg cohorts? And then wanted to ask a follow-up on your pivotal design. Any sense yet for what the comparator arm would need to be, given that you guys are planning on going straight into the third line setting? And then just kind of final question. Also wanted to ask about your plan for implementing a prophylaxis protocol as you think about a combination approach and moving this program into earlier treatment lines.

Thanks, Olivia. Great questions. In terms of treatment line, I think we just emphasized that again, late line patient population, we haven't broken that out. I would say that across the study it's very consistent with what we saw in the phase I disclosure in May of last year, where we did break out at that time the specific number of priors for each patient. You could see one, the one patient we do like to point out who had actually 10 prior lines of therapy, who had actually the deepest response. This drug is active in patients who are heavily pretreated, really across the board. I should also emphasize something we haven't really focused on too much today. I can't underscore how important this is that this is an unselected patient population.

We're not selecting for EpCAM, we're not selecting for target. It really is an all-comer, late-stage patient population. This is incredibly valuable and attractive in the context of the use of this drug ultimately, we think, in its uptake, because patients can be rapidly brought onto Varseta-M, without a whole lot of workup necessary because we're not selecting for KRAS or BRAF or liver mets. You can see actually the percentage of patients in the study with liver mets and KRAS mutations is higher than it was last year. It's almost—it's about three-quarters of patients. I think this gives some important insights into how oncologists are using this drug at this early stage in its development.

In terms of the pivotal comparator, I mean, in the third-line, if you look at studies being conducted by others, that's bevacizumab plus Lonsurf. That is currently the standard of care in the third-line setting. So that's something that we'll look at. As we've said, we do believe this data points us increasingly in that direction. No decisions made yet, but we are actively considering that as the data continues to mature, and in particular, as we get a read on OS later in the year. And then in terms of prophylactic strategies, let me ask Wayne to comment on that in terms of, you know, the extrapolation of what we've seen so far into the combination setting.

Yeah. I mean, as we highlighted today, I mean, we really believe that we have a very effective prophylactic strategy with the dual use of loperamide and budesonide. We don't foresee significant challenges to move into the front line and, you know, for multiple reasons. One, you know, we should remind everyone that both medications are oral, so there's a convenience factor for patients that make this relatively easy to take. Secondly, even in the early line setting, remember that, you know, many of the chemotherapy agents used in early line settings themselves cause diarrhea. So management of diarrhea with these standard agents will uniformly involve some form of anti-GI motility agent such as loperamide. So the adaptation of loperamide in a prophylactic sense in the early line should not be a significant barrier.

Finally, I'll just point out that, you know, the use of combination prophylactic agents is not just restricted to diarrhea. For example, nausea and vomiting, for example, typically utilize multiple agents for prophylaxis, including that that's administered intravenously. So again, I think in total, we don't see this as a significant barrier in any way of implementing prophylaxis in early line settings.

Great. Thank you, guys. Very helpful.

Thank you. Our next question comes from the line of Etzer Darout with Barclays. Your line is now open.

Thanks for taking the question, and congrats as well on this data update. Couple of questions from me. First, just curious about maybe dose selection for the bev combination studies as well as the other tumor types based on the data we're seeing today. Also in the KRAS activity was interesting. Just wondering if you would consider KRAS wild type as well as mutant in an earlier line setting based again on the data that you're disclosing today. Thank you.

Thanks, Etzer. Great questions. With regards to dose selection for the bev combo and other tumors, work in progress. We are doing some dose ranging with bev. As you might imagine, that work has been kicked off, and we'll have more to say about that later this year or early next year. I should also say that in thinking about dose optimization overall, it just think about where we are now compared to where we were 10 or so months ago. We've narrowed the field from three active doses, 7 mg/kg-8.6 mg/kg and 10 mg/kg, to the two highest doses, 8.6 mg/kg and 10 mg/kg.

You know, these are both great options, and we're learning more about them to pick the go-forward dose for the first pivotal. We've really learned an enormous amount about how to use this drug and how to optimize dosing in a very short space of time. We'll be porting that, of course, over to our experience as we begin work in other tumor types as well. Terrific progress. In terms of KRAS mutational status, that's an interesting question because, of course, in the context of EGFR therapies, you know, there is patient selection that relates to the signaling mechanism of the EGF Receptor and RAS signaling and such like.

In our case, this is one of the beauties of Varseta. It doesn't really matter, we don't think. The target is present at high levels on every patient, and we've shown activity in KRAS wild type and KRAS mutants. I think it just emphasizes that we, you know, right now we don't need to select patients. Now, that doesn't mean that we're not looking at our data for clues as to where the drug may be perhaps even more active. Right now, the main message with Varseta is that this is a drug for all comer CRC.

Thank you.

Thank you. Our next question comes from the line of Anupam Rama with JPMorgan. Your line is now open.

Hey, guys. Thanks so much for taking the question and congrats on the update. Sean, just wanted to follow up on your comments about, hey, we're learning a lot more here about the 8.6 mg/kg and 10 mg/kg doses that were used in the dose optimization. Any difference there in I know it's only 20 patients, but any difference there in terms of what you're seeing on diarrhea as well as on the efficacy side, ORR in particular, anything in the dose optimization portion that you can comment on in the 20 or so patients? Thanks so much.

Yeah. Thanks, Anupam. With regards to the diarrhea, too early to comment on that. Obviously, the data as it stands, we think is very exciting, but it is early. The dose optimization cohorts, as we enroll up to the full 40 patients, will continue to mature over time. With regards to activity, the exposure efficacy model that Wayne walked you through is, we think, really important, and it integrates so much of the work that we've done over the last year or so in understanding the pharmacokinetic and pharmacodynamic profile of Varseta. We feel very optimistic that we're in the right dose range with adjusted ideal body weight dosing. The drug will continue to show robust activity as we move forward.

That data will be forthcoming. What we've really tried to convey with that model that's based on data from the expansion cohorts itself, this is really important. The PK exposure efficacy model is built on our actual experience in the expansion phase. We think it's highly predictive of what we'll see with the optimization cohorts. That data, as Wayne also mentioned, will be very helpful as we go to FDA and discuss considerations around Project Optimus.

Thanks so much for taking our questions.

Thank you. Our next question comes from the line of Robert Driscoll with Wedbush. Your line is now open.

Hey, guys. Thanks for taking the question, and congrats again on the data update today. Just kind of given the reduction in GI AE here with the prophylaxis regimen, and other things kind of and the optimized dosing, just wondered if you were considering reevaluating the higher dose cohorts here, the 11 mg/kg or 12 mg/kg. Then second question, just could you remind us of the focus indications here, for the broadening study, for the outcome positive tumor types and how big those cohorts might be? Thanks.

Thanks, Robert. With regard to the question on reducing tox and increasing dose, we're very pleased with where we are right now with these two doses. We think they integrate really all of the learning so far. They continue to give us a lot of room to maneuver, as we've always said, with Varseta-M. We don't really see a need to push the dose higher. Now, that said, this drug's gonna have a long life cycle ahead of it. There's a lot of work that remains to be done to maximize that opportunity. Right now, we feel really good about where we are. In terms of non-CRC, again, there are so many opportunities there.

It is so exciting to think about how many patients we could benefit with this drug over time. Nothing really more to say there in terms of exactly where we're going or size of study, but we will provide additional details as the year goes on. It is important to strike a balance, and it's one of the hardest things to do, really, at the moment. It's striking a balance between going as fast as we can in CRC and getting going elsewhere, but we're gonna try and do it all.

Great. Thanks so much, guys.

Thank you. As a reminder, to ask a question at this time, please press star one one on your touchtone telephone. Our next question comes from the line of Mitchell Kapoor with H.C. Wainwright. Your line is now open.

Hey, guys. Congrats on the impressive data. A couple of questions from us. Firstly, can you comment on the frequency of grade 3 diarrhea events at the 8.6 mg/kg and 10 mg/kg dose levels? Our work with KOL was suggesting that, the number of events was maybe more important than the headline of, you know, the rates of grade 3 diarrhea. Then separately, on the optimized safety regimen, how much of the grade 3 diarrhea improvement to 10% do you attribute to the adjusted body weight dosing versus the updated prophylaxis? If you can just help us on the median time on therapy for these optimized safety cohort patients, just in light of the median time to onset of the diarrhea events.

Yeah. Hey, Mitch. This is Chris. I think your first question relates to does grade 3 diarrhea tend to recur? Is that my understanding of the question versus just happening?

Yeah. Yeah.

Okay.

Right. Like,

Okay.

Are the patients in the hospital once a month or, you know, kind of like, how does the grade 3 diarrhea manifest itself over time?

You know, our focus, Mitch, it's a good question. Our focus is, in these optimization cohorts, of course, to prevent patients getting into it in the first place. That's really what we're focused on right now. We're just really encouraged by these initial data. I again, I'd like to really emphasize and really commend Wayne and the team for doing some terrific work here, really listening to our investigators, really understanding the patient experience and keying in to some of these key clinical observations, particularly with budesonide and seeing that evidence that given some of these PK outliers, that AIBW dosing could be a significant addition to the overall dosing strategy.

In terms of the role or the contribution of adjusted ideal body weight to the improved safety profile, you know, hard to tell. Obviously, right now we're using loperamide budesonide and AIBW, and it looks like it's working, so, you know, we'll take it. I think over time we'll learn more. It would be expected, I guess, said slightly differently, wouldn't be a surprise, of course, if AIBW was having a significant impact because we did see. As you can see in the PK curves, we wanted to be very transparent about this and show the per patient PK. You can see that in the non-AIBW there is a fair amount of variability, some of which is driven by BMI, for example.

We'll learn more over time. I'm sorry, I think your last question.

Yeah. The last part of it was just trying to understand how long these patients have been on therapy on the optimized safety dose, just in light of their median time to onset of diarrhea, so we can understand kind of the context of that 10% rate.

Yeah. As we presented in today's update, this is the two-month cutoff, and that's very relevant because the median time to onset of grade 3 in our experience to date is about five weeks. We do think this is a meaningful time point. We will continue to follow these patients. We're continuing to enroll, right? We're gonna increase enrollment from 20 to 40 patients. This will be a much more mature data set as we move into midyear and into the H2 of 2026. Work in progress, but we think a very good start.

Great. Congrats again.

Thank you.

Thanks so much.

That concludes our question and answer session. I will now turn the call back over to Dr. Sean McCarthy for closing remarks.

Well, thank you again, everyone, for joining us today. We are delighted to have given this update, and we appreciate your interest, and we very much look forward to providing additional updates as the year goes on and following up with you all. Take care.

This concludes today's conference. Thank you for your participation. You may now disconnect.