MACROGENICS INC Q1 FY2023 earnings call

• US FDA approved Insight’s ZYNYZ for metastatic recurrent locally advanced Merkel cell carcinoma, third US marketing clearance for MacroGenics' products.
• Updates on clinical programs: Vobramitamab duocarmazine (vobra duo) Phase 2 TAMARACK study protocol modified, enrollment expected this quarter. Lorigerlimab Phase 2 randomized study in mCRPC planned for second half of 2023. MGD-024 Phase 1 study ongoing. Enoblituzumab Phase 2 study results showed 66% of patients had undetectable PSA 12 months post-surgery.
• Collaboration updates: Received $100 million upfront from DRI for single digit royalty on TZIELD, retains 50% share above threshold; Sanofi acquisition of Provention Bio and DRI’s royalty interest in TZIELD leaves economic interests unchanged with potential up to $430 million in milestones.
• Cash runway: Anticipated cash balance plus future payments provide runway through 2025, funding Phase 2 TAMARACK, lorigerlimab Phase 2, and other clinical/preclinical studies.

MacroGenics reported total revenue of $24.5 million for the quarter ended March 31, 2023, primarily from collaborative agreements, compared to $11.1 million in Q1 2022. Revenue included a $15 million milestone from Insight, $3.6 million in contract manufacturing revenue, and $3.5 million in MARGENZA net sales. Research and development expenses were $45.9 million in Q1 2023, down from $61.4 million in Q1 2022, due to decreased vobramitamab duocarmazine development costs and discontinued studies, partially offset by increased discovery and clinical expenses. Selling, general and administrative expenses were $13.5 million in Q1 2023, down from $16.3 million in Q1 2022, primarily due to decreased legal and consulting expenses. Net loss was $38 million in Q1 2023, better than the $66.4 million net loss in Q1 2022. Cash, cash equivalents, and marketable securities balance was $241.7 million as of March 31, 2023, providing a cash runway through 2025.

• Cash runway through 2025 expected based on $241.7 million cash balance as of March 31, 2023, plus projected partner payments and product revenues.
• Anticipated funding requirements include Phase 2 TAMARACK clinical trial, Phase 2 lorigerlimab in mCRPC, and other clinical/preclinical studies.

Q: How are you thinking about your cash position now following non-dilutive deals?

A: Very pleased with cash position, provides runway through 2025 and early 2026, actively seeking additional business development opportunities for future revenues.

Q: Should we expect clinical data from the vobra duo plus lorigerlimab combo study this year?

A: Less likely to have data by end of 2023, more likely in first part of 2024 as dosing and study expansion are ongoing.

Q: What efficacy signal would you anticipate from the docetaxel control arm and combo arm in the lorigerlimab docetaxel combo trial?

A: Historical rPFS for docetaxel control arm in chemo naive setting is ~8.3 months, median OS ~19 months; aim to exceed these with the combo arm.

Q: Thoughts on lorigerlimab dosing for the docetaxel combo cohort?

A: Starting at 6 mgs/kg Q3 weekly, with opportunity to adjust doses based on safety and efficacy, wide window of opportunity to balance safety and activity.

Q: Plans for vobra duo registrational strategy after removing control arm?

A: Will assess landscape when doses are selected for vobra duo, considering changing treatment landscape and other combinations like PARP inhibitors, not ready to finalize control yet.