CanBas Co.,Ltd. Q4 FY2025 earnings call

• Pipeline Strategy: Focus on immunotherapy candidates targeting "immune cold" solid tumors, most advanced candidate is CBP501 for metastatic pancreatic cancer. CBP501 acts as an "immune igniter": when combined with cisplatin and anti-PD-1 immunotherapy (Opdivo), it induces immunogenic cancer cell death and suppresses immunosuppressive macrophages, turning immune cold tumors immune hot to enable immunotherapy efficacy.
• CBP501 Phase 2 Trial Results: Positive Phase 2 trial results for 3rd-line metastatic pancreatic cancer were published in a peer-reviewed presentation and paper. The 25mg CBP501 triple combination arm met the primary endpoint of 3-month progression-free survival, and the independent Safety Monitoring Committee recommended advancing directly to Phase 3. The combination showed well-tolerated safety within acceptable limits, and achieved clinically meaningful improvements in progression-free survival, progression-free interval and overall survival. Among 8 treated patients, 2 achieved objective response, a rare outcome for 3rd-line pancreatic cancer (historical response rate <5%).
• CBP501 Phase 3 Preparation: Management is prioritizing application and preparation for a Phase 3 trial in Europe, with the US already holding approved Phase 2b trial initiation as a backup plan if the European application fails. Contract negotiations with European trial sites are progressing steadily. The estimated total cost of the Phase 3 trial remains 4.5 billion yen to 5 billion yen, unchanged from prior guidance.
• CBS9106 Update: The XPO1 inhibitor candidate had all rights returned to Canvas by licensee Stemline in June 2025 after completion of Phase 1. Cumulative 700 million yen in milestone and advisory fees was received from the license agreement. Preclinical data indicates CBS9106 induces XPO1 degradation, leading to potentially fewer side effects than the already approved XPO1 inhibitor Selinexor. Management will conduct additional basic research and evaluate development strategy based on financial resources and market conditions.
• Earlier Stage Pipeline: CBT005, an ImmunoSwitch immunotherapy candidate also targeting immune cold tumors, is in preclinical preparation. Other early stage projects include CBP-A08 (CBP501 backup candidate), IDO/TDO dual inhibitor, NEXT immunotherapy project, and an AI-based anti-cancer drug sensitivity prediction system.

Canvas Inc. is a clinical-stage biotech with no product revenue as of the 2025 June fiscal year. Total business expenses were 1.109 billion yen, broken down as: 1. Basic research expenses: 216 million yen (19.5% of total expenses), including a one-off 12 million yen termination fee paid to Stemline for the CBS9106 license termination; 2. Clinical development expenses: 603 million yen (54.4% of total expenses), almost all allocated to CBP501 European Phase 3 trial application and preparation; 3. Selling, general and administrative expenses: 289 million yen (26.1% of total expenses), flat year-over-year. Cash and cash equivalents increased by 960 million yen year-over-year, with over 2.8 billion yen held at period end, from 4 billion yen raised in 2023 financing.

• The 2027 target for regulatory approval and launch of CBP501 is maintained, as 2027 remains within the realistic range of possible timelines after accounting for all uncertainties in the Phase 3 process, including approval timing, patient enrollment, and regulatory review. Management will publicly revise the target via official filing if it moves outside the 2027 range.
• The total Phase 3 cost guidance of 4.5 billion yen to 5 billion yen is maintained, with no changes to the initial feasibility target. The company currently holds enough cash to cover CBP501 Phase 3 initiation, but additional funding will be needed to cover full trial costs. Management will not rush fundraising at the current depressed market valuation while trial initiation is uncertain, and will prioritize options that minimize shareholder dilution, including public market financing, pharmaceutical partnership, or pre-partnership private placement.
• CBP501 news flow expectations are unchanged, with timing dependent on uncontrollable regulatory processes.

• There is material timing uncertainty for obtaining European Phase 3 trial initiation approval, which is outside of management control.
• While the risk of non-timing related failures (regulatory rejection of the trial design/plan) is currently assessed as low, this risk remains and could prevent trial initiation.
• Additional funding is required to complete the CBP501 Phase 3 trial, and unfavorable market conditions could result in excessive shareholder dilution if funding is raised at the current valuation. If the European application is delayed long-term, the company has the option to run the first stage of the US Phase 2b in parallel, which would require additional incremental cost. If European Phase 3 cannot be initiated, full development via the US pathway would require substantially higher total cost.

Q: Why has the 2027 approval target not been revised despite multiple ongoing delays and uncertainties, and when will management change the target if needed? / A: There are multiple layers of uncertainty across the entire process from trial initiation approval to final regulatory approval, including start timing, site activation, patient enrollment, and review timelines. The 2027 target remains within the range of realistic possible outcomes under current conditions, so no change is needed. If the realistic range of timelines shifts outside of 2027, management will promptly disclose the change via an update to the official Growth Possibility Explanation Document. Management will not specify a hard deadline to avoid misleading investors, and will continue providing transparent updates to support investor decision-making.

Q: Progress on the European Phase 3 application has been slow for over a year, what is the main bottleneck? Is it funding, or challenges faced by a Japanese biotech running an overseas trial? / A: Funding is not a bottleneck, the company has sufficient resources to continue preparation and respond to regulatory requests. Being a Japanese company has not caused unusual challenges in Europe, unlike past experiences in the US where inconsistent regulatory interpretations created delays. The main cause of delay is detailed regulatory differences between Europe and the US, despite general harmonization of rules. Because this is a registration Phase 3 trial, European regulators require commercial-grade manufacturing and supply processes that meet strict standards, leading to extensive detailed inquiries and required adjustments to previously US-validated processes that are still being addressed.

Q: How has the market opportunity for CBP501 changed with the recent progress of competing pancreatic cancer therapies in earlier lines of treatment? / A: Most competing candidates in development target 1st and 2nd-line treatment, so there is no direct competition with CBP501, which is being developed for 3rd-line treatment. Even if earlier-line therapies are successful, they will not eliminate the need for 3rd-line treatment, and will actually increase the pool of eligible patients for 3rd-line therapy by extending patient survival to that stage. Successful new earlier-line therapies will also leave patients fitter when they reach 3rd-line treatment, which improves the trial and commercial outlook for CBP501. This dynamic of early stage candidates failing to reach registration is common in pancreatic cancer, so the current pipeline of competing early-stage candidates does not change CBP501's value.