On May 16, 2022 Nykode Therapeutics reported that (Press release, Nykode Therapeutics, MAY 16, 2022, View Source [SID1234614573])

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Highlights:
• Nykode announced completion of patient enrollment in its Phase II trial of VB10.16 in combination with immune checkpoint inhibitor atezolizumab for the treatment of advanced cervical cancer
• Received milestone payment of USD 20 million for initiation of phase 1b trial Highlights after March 31st, 2022:
• Nykode Therapeutics announced positive interim results from its Phase II trial with VB10.16 in combination with atezolizumab in advanced cervical cancer o Anti-tumor activity of VB10.16 in combination with atezolizumab was observed in a heavily pretreated population of patients with HPV16-positive advanced cervical cancer. Strong overall response rate (ORR) was observed in both PD-L1 positive patients (ORR of 27%) and in PD-L1 negative patients (ORR of 17%). Overall ORR of 21% including two complete responses (CRs) and six partial responses (PRs) were observed in the 39 patients studied o VB10.16 in combination with atezolizumab demonstrated a very high disease control rate (DCR, which includes patients who have achieved complete response, partial response and stable disease) of 64% (77% in PD-L1 positive patients and 58% in PD-L1 negative patients)
• Nykode Therapeutics presented preclinical data from its second generation Vaccibody vaccine technology at the 2022 American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting
• At Nykode’s AGM on May 12, 2022, it was resolved to convert the Company from a private limited liability company (AS) to a public limited liability company (ASA)
• Elaine Sullivan and Anne Whitaker elected to join the Board of Directors at the Company’s AGM on May 12, 2022 Michael Engsig, Chief Executive Officer at Nykode, comments: "I am delighted that the interim results from the phase II study with VB10.16 in combination with atezolizumab in HPV-16 positive cervical cancer support Nykode’s unique approach of targeting Antigen Presenting Cells (APCs), designed to produce a robust and long-lasting CD8 killer T cell response against cancer cells. In particular I am excited about the signs of durable anti-tumor activity in a heavily pre-treated and hard to treat population of patients with late-stage HPV16-positive cervical cancer.

Furthermore, the indication that the treatment may benefit not only PD-L1 positive patients but also PD-L1 negative patients and patients with immune excluded tumors may bode well for the continued development." Michael Engsig continues "Building on the promising clinical efficacy and favorable safety profile that was observed with VB10.16, Nykode has started planning the NYK003-C-03 Phase 1b trial of VB10.16 in combination with a check point inhibitor in patients with HPV16-positive squamous cell head and neck cancer (HNSCC). The trial is expected to start in the second half of 2022. In addition to the positive development of the wholly owned pipeline, and the disclosure of exciting new preclinical data from our second generation Vaccibody technology platform, I am pleased to report that the Regeneron collaboration is off to a good start. It is progressing according to plan, with lots of energy and good discussions."R&D update Nykode’s modular technology platform is very versatile and may be adapted to generate the desired immune response profile. Hence, Nykode’s platform may be applied across a broad range of immunotherapy areas as innovative solutions to an unmet medical need. Nykode continues to increase the headcount across all functions including R&D to continue to build competencies and support the strategy execution. Please find below an update on Nykode’s current research and development activities.

Oncology VB10.16 VB10.16 is a therapeutic HPV vaccine directed against HPV16+ induced malignancies:
• Clinical trial VB C-02: − Clinical stage: Phase II − Cancer indication: HPV16+ advanced, non-resectable cervical cancer − Fully enrolled − ClinicalTrials.gov Identifier: NCT04405349 Status and highlights The trial is fully enrolled and reported positive interim efficacy and safety data on May 9, 2022. Interim results from 39 patients with a median follow up of 6 months show an ORR of 21%, including two patients who achieved a complete response and six who achieved a partial response, and a very high disease control rate of 64%. The trial enrolled a heavily pre-treated patient population with more than two thirds of the patients having received at least two previous systemic lines of treatment. Interestingly, anti-tumor activity was observed in both PD-L1 positive (ORR of 27% and DCR of 77%) and PD-L1 negative patients (ORR of 17% and DCR of 58%) indicating a potential clinical benefit also in the PD-L1 negative population. In addition, a DCR of 71% was observed in patients with noninflamed tumors, including both immune desert and T cell excluded tumors.

Together these findings suggest a differentiated anti-tumor response pattern of the combination treatment compared to checkpoint inhibitor monotherapy. Nykode expects to report updated efficacy data read-outs from VB C-02 during the first half of 2023. VB10.NEO VB10.NEO is an individualized neoantigen cancer vaccine, exclusively licensed to Genentech:
• Clinical trial VB N-01: − Clinical stage: Phase I/IIa − Cancer indications: Melanoma, non-small cell lung cancer (NSCLC), clear renal cell carcinoma, urothelial cancer or squamous cell carcinoma of the head and neck (SCCHN) − Fully enrolled − ClinicalTrials.gov Identifier: NCT03548467
• Clinical trial VB N-02: − Clinical stage: Phase Ib − Cancer indications: Locally advanced and metastatic tumors − ClinicalTrials.gov Identifier: NCT05018273 Org.no. N-990 646 066 MVA 5 Status and highlights News flow updates relating to VB10.NEO are in general at Genentech’s discretion. Recruiting sites are open in US, Germany and Spain. Infectious Diseases Nykode’s infectious disease initiative continues to generate supportive data and explore and evaluate a diverse set of pathogens as potential next future clinical vaccine targets. VB10.COV2 Nykode has chosen a 2-arm strategy for its VB10.COV2 project to fight SARS-CoV2 variants of concern (VoC*).

VB10.2129 (RBD candidate) and VB10.2210 (T cell candidate) are two vaccines designed using Nykode’s modular and APC targeted technology:
• Clinical trial VB-D-01, investigating the two vaccine candidates, VB2129 and VB2210. − Clinical stage: Phase I/II − Pathogen: SARS CoV-2 − ClinicalTrials.gov Identifier: NCT05069623 VB10.2129 – 2nd generation vaccine addressing novel variants of concern* VB10.2129 contains the RBD domain of the Beta variant of concern B1.351. Importantly, preclinical data demonstrate induction of rapid, strong and persistent neutralizing antibody responses in animal models by VB2129 not only against the Beta variant, but also across several other major variants of concern. Nykode’s RBD vaccine candidate has the potential to induce rapid and strong levels of neutralizing antibody responses addressing both existing and emerging variants of concern.

VB10.2210 – 3rd generation universal broadly protective T cell vaccine Increasing evidence highlights the importance of broad T cell responses in providing rapid as well as long-term memory responses against COVID-19 with limited sensitivity to viral mutations. The vaccine includes SARS-CoV2 T cell epitopes identified and validated by Adaptive Biotechnologies. Nykode aims to boost and broaden the most clinically relevant and conserved T cell responses against a broad set of SARS-CoV-2 epitopes identified by Adaptive Biotechnologies. Preclinical data confirm induction of strong T cell responses against multiple SARS-CoV2 antigens in several mouse models. The aim is to induce long-lasting protective immunity across all population groups and across current and future variants. VB-D-01 trial The VB-D-01 trial is a Phase I/II, open label, dose escalation trial to determine safety and immunogenicity of two SARS CoV-2 vaccine candidates VB10.2129 and VB10.2210. Status and highlights VB10.2129 (RBD candidate): First subject dosed November 3, 2021.

The trial is fully enrolled at two out of three dose levels in the dose-escalation cohort. VB10.2210 (T cell candidate): First subject dosed December 27, 2021. The trial is fully enrolled at all three dose levels in the dose-escalation cohort. Results from the Phase I dose-escalation cohort is expected during the second half of 2022.

*Note: All viruses, including SARS-CoV-2, mutate and change over time. Most changes have limited impact on the virus’ properties. However, some changes may affect the virus’s properties, e.g., as how easily it spreads, the associated disease severity, or the performance of vaccines, diagnostic tools and so forth. The emergence of variants that poses an increased risk to global public health has prompted the characterization of specific variants of concern, in order to prioritize global monitoring and research, and ultimately to inform the ongoing response to the COVID19 pandemic. Source: Tracking SARS-CoV-2 variants (who.int)

MVA 6 Autoimmune disorders Autoimmune disorders are caused by unwanted immunogenicity to autoantigens. Antigen-specific tolerization for the treatment of auto-immune diseases has the potential to blunt autoimmunity without compromising normal immune function. Nykode is exploring autoimmunity model systems to generate pre-clinical proof-of-concept for the ability to induce meaningful antigen-specific immune tolerance. Nykode has demonstrated that its exploratory tolerizing vaccines induce proliferation of epitope specific T regulatory cells in such model systems and will continue its research and know-how building in the area. Other Uplift on Oslo Stock Exchange Nykode has initiated a process for transfer of the listing of its shares from Euronext Growth to the main market of the Oslo Stock Exchange. The expected timing is end of the second quarter of 2022.

Financial review Income statement The net result for the first quarter of 2022 was a net loss of USD 6.9 million compared to a net loss of USD 6.5 million in the first quarter of 2021. The change in net loss was mainly due to increased activities and operations in Nykode, leading to increased operating expenses and employee benefit expenses. This was offset by an increase in total revenue as well as a decrease in the social security cost accrual related to share-based payments included under employee benefit expenses. Revenue and other income Total revenue and other income amounted to USD 1.0 million in the first quarter of 2022 (Q1 2021: USD 0.8 million).

The increase was mainly due to increased R&D service activities under the agreements with Genentech and Regeneron. Operating expenses Total operating expenses amounted to USD 9.6 million in the first quarter of 2022 (Q1 2021: USD 8.3 million). Employee benefit expenses were USD 1.3 million in the first quarter (Q1 2021: USD 3.9 million). The decrease in employee benefit expenses in 2022 is primarily due to the reduction of the social security cost accrual related to share-based payments. This accrual is dependent on the share price as Nykode is required to accrue for the social security cost for all warrants and options that are in-the-money at the balance sheet date. This relates to both the current and the non-current portion. As the share price decreased during the quarter the accrual is also reduced. The corresponding reduction is USD 4.8 million.

The decrease is offset by the planned increase in headcount. Other operating expenses increased from USD 4.3 million in the first quarter of 2021 to USD 7.9 million in the first quarter of 2022, driven by increased operating activity. Net financial income and expenses Net financial income and expenses were USD 0.1 million in the first quarter of 2022 (Q1 2021: USD 0.8 million loss). Finance income and finance costs mainly relate to movements in foreign currency exchange rates and fair value adjustments of financial instruments. Income tax expenses The Group recognized tax income of USD 1.7 million in the first quarter of 2022 and USD 1.7 million in the first quarter of 2021.

The income tax expense is primarily related to movement in deferred tax. Statement of financial position Cash At March 31, 2022, Nykode had a cash position of USD 225.7 million compared to USD 216.2 million at December 31, 2021. The increase in cash is mainly a result from operating activities. Equity At March 31, 2022, total equity amounted to USD 188.6 million, compared to USD 194.1 million at December 31, 2021. The change mainly reflects the net loss of the period of USD 6.9 million, the exercise of warrants and options and recognition of share-based payments. Trade receivables At March 31, 2022, trade receivables amounted to USD 2.5 million, compared to USD 23.8 million at December 31, 2021. The decrease is mainly due to the receipt of the USD 20 million milestone payment from Genentech in the first quarter of 2022.

Trade and other payables At March 31, 2022, trade and other payables amounted to USD 7.0 million, compared to USD 8.5 million at December 31, 2021. Contract liability At March 31, 2022, total contract liability amounted to USD 18.0 million, compared to a contract liability of USD 16.0 million at December 31, 2021. The contract liability is mainly due to timing of invoicing to Genentech as well as recognition of the service component under the Genentech agreement. Other current financial assets At March 31, 2022, total other current financial assets amounted to USD 12.2 million compared to USD 12.2 million at December 31, 2021. Cash flow Net change in cash and cash equivalents was positive USD 9.5 million in the first quarter of 2022 (Q1 2021: USD 4.1 million negative).

Cash and cash equivalents increased to USD 225.7 million at the end of the period, compared to USD 179.7 million at the end of the same period in 2021. Cash flow from operating activities Net cash flow from operating activities was positive USD 10.9 million in the first quarter of 2022 (Q1 2021: USD 5.0 million negative). This was primarily driven by the decrease in trade receivables due to the receipt of the milestone payment from Genentech, offset by a negative profit before tax. Cash flow from investing activities Cash flow from investing activities was negative USD 1.6 million in the first quarter of 2022 (Q1 2021: USD 0.6 million positive).

The amounts mainly relate to the purchase of property, plant and equipment. Cash flow from financing activities Cash flow from financing activities was positive USD 0.1 million in the first quarter of 2022 (Q1 2021: USD 0.3 million positive). The amounts primarily relate to the proceeds from equity issuance, offset by payment of lease liabilities. Outlook The first major clinical objective for 2022 has been reached, namely:-VB C-02 clinical trial, positive interim efficacy and safety results have been reported Expected outlook and news flow regarding Nykode’s key priorities for the remainder of 2022 include: Uplift from Euronext Growth to the main list of Oslo Stock Exchange VB10.16 – Initiation of NYK003-C-03 Phase Ib trial in HNSCC VB-D-01 trial – Phase I key results with Nykode’s two COVID vaccine candidates measuring T cell and antibody responses Update on manufacturing strategy The Company has a strong cash position and no debt.

The Company is in continuous dialogue with academic and industrial entities and will announce new key collaborations and partnerships if or when they may occur. The COVID-19 pandemic and the situation in Ukraine may impact timelines and operations.

Disclaimer This announcement and any materials distributed in connection with this announcement may contain certain forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty because they reflect the company’s current expectations and assumptions as to future events and circumstances that may not prove accurate. A number of material factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.