Rallybio Corp Stock

Ladies and gentlemen, thank you for standing by. Welcome to the merger between Rallybio Corporation and Avenzo Therapeutics.

[Operator Instructions] Please be advised that today's conference is being recorded.

I would like now to turn the conference over to Stephen Uden, Co-Founder and Chief Executive Officer. Please go ahead.

Thanks, Michelle. Thank you, and good morning. Before we begin, I'd like to remind you that this discussion will contain forward-looking statements based upon the current expectations of Rallybio and Avenzo, which include, but are not limited to, statements regarding the expected timing, completion, effects and intended outcomes for the proposed transactions and our future expectations, plans and prospects for the combined company, including clinical development matters, use of proceeds, expected cash runway and expected milestones.

Such statements represent management's judgment and intention as of today and involve assumptions, risks and uncertainties. Except to the extent required by law, we do not undertake any obligation to update any forward-looking statements. We also caution you against placing undue reliance on any forward-looking statements.

Further, as indicated on these slides, Rallybio intends to file a registration statement and accompanying proxy statement and prospectus with the Securities and Exchange Commission relating to the proposed transaction. Please be advised to read, when available, these and other relevant documents filed with the SEC. Please refer to the accompanying slides for more details on these forward-looking statements.

I will now turn the conference over to Dr. Athena Countouriotis, Chair, President and Chief Executive Officer of Avenzo Therapeutics. Athena?

Thank you, Stephen, and good morning, everyone. I want to thank the team at Rallybio for all the work they have done to get to today, and for their belief in our team and our mission. At Avenzo, our mission is to improve the lives of people living with cancer, by delivering next-generation therapies that improve upon today's standard of care.

With this announcement, we are excited to share the Avenzo story more broadly and to outline our plans to advance what we believe is a differentiated pipeline of small molecules and antibody drug conjugates that are progressing across 4 Phase I clinical trials in various solid tumor indications.

Avenzo Therapeutics was founded in the fall of 2022 by myself and Dr. Mohammad Hirmand, our Chief Medical Officer, after the acquisition of Turning Point Therapeutics by Bristol Myers Squibb. Between Mohammad and myself, we have been fortunate to develop multiple small molecules and antibody drug conjugates, or ADCs, within oncology, which are now marketed. Our Avenzo team is approximately 60 team members with deep expertise in oncology drug development and whom I have had the pleasure of working with for many years across different companies.

Our strategy at Avenzo parallels that of Turning Point with respect to how we've established a clinical-stage oncology pipeline of potentially differentiated programs that address areas of significant unmet need, with Avenzo having exclusive rights outside of Greater China. Today that pipeline consists of 4 programs spanning small molecules and ADCs, all of which are now being advanced in Phase I studies in the United States.

Our approach in building the pipeline was to identify potentially differentiated programs with strong biologic rationale and significant commercial potential, where we could utilize our expertise in drug development to rapidly advance each program to treat patients with unmet needs. We're excited about the pipeline we've assembled, excuse me, and believe we are well positioned to advance these programs across multiple clinical milestones as a result of this transaction.

Our pipeline includes 2 highly selective cyclin dependent kinase, or CDK, inhibitors: AVZO-021, our selective CDK2 inhibitor, and AVZO-023, our selective CDK4 inhibitor; as well as 2 bispecific ADCs, AVZO-1418, our bispecific ADC targeting EGFR and HER3, and AVZO-103, our bispecific ADC targeting Nectin-4 and TROP2. All 4 of our programs are being evaluated in ongoing Phase I studies conducted by our team in the U.S. while our partners are in parallel making progress within Greater China either as part of our study or in their own China-based study. We are truly excited about the potential of each of our agents as monotherapy and/or in combinations, such as the combination of our CDK2 and CDK4 with endocrine therapy in hormone receptor-positive/HER2-negative breast cancer.

Later today at the American Society of Clinical Oncology conference in Chicago, we will be presenting updated data from the ongoing Phase I study of AVZO-021, our CDK2 inhibitor, in HR-positive/HER2-negative breast cancer. We have treated 64 patients in total across monotherapy and in combination with fulvestrant. And we continue to believe these data support a differentiated profile given our CDK2 inhibitor's tolerability and clinical activity, including the emerging progression-free survival data of 5.3 months in patients with HR-positive/HER2-negative metastatic breast cancer with a median of 4 prior therapies in the metastatic setting.

In addition, we recently treated the first patient with the triplet combination of AVZO-021, our CDK2 inhibitor, with our selective CDK4 inhibitor, AVZO-023, and fulvestrant in the Phase I portion of the ORION-1 study. Beyond the triplet, the ORION-1 study is also evaluating the doublet combination of 023 and endocrine therapy in patients with previously treated HR-positive/HER2-negative metastatic breast cancer. We are encouraged by the initial profile of our selective CDK4 inhibitor, including its tolerability, specifically its lack of diarrhea, which is often difficult for patients, and emerging clinical activity and look forward to sharing updated data from the ORION-1 study later this year.

As for our 2 bispecific ADC programs, AVZO-1418 is our most advanced ADC targeting both EGFR and HER3. We have already dosed over 30 patients since initiating the Phase I portion of the AVENTINE-1 study in mid-2025. We are encouraged by the initial clinical data where clinical activity was observed across multiple tumor types with a potentially differentiated tolerability profile, especially in terms of hematologic adverse events.

Last in our pipeline is our fourth clinical-stage program, AVZO-103, a bispecific ADC targeting both Nectin-4 and TROP2. This is in the early stages of the ongoing Phase I portion of the BEACON-1 study, and we look forward to sharing clinical data from both of our ADC programs later this year.

With the additional $215 million expected to be raised as part of this transaction, in addition to the current cash on our balance sheet, we expect to have sufficient runway into late 2028 to advance our clinical-stage programs through multiple clinical milestones, including updated Phase I data across the pipeline, initial clinical data from the combination of 023 and 021 with fulvestrant and the initiation of multiple Phase II studies. We look forward to sharing more about our later-stage development plans with you over time.

I want to conclude my remarks by thanking all of the Avenzo team members, many of whom are currently at the ASCO conference, and especially my Co-Founder, Dr. Mohammad Hirmand; and our Chief Financial and Chief Business Officer, Scott Lipman, for your tireless efforts to get to today. I know you both and the team have worked incredibly hard to get here and work hard for the patients we serve.

I also want to thank our Series A and Series B investors who have supported us over the past 4 years. And to our new investors, we look forward to working with you following the close of this transaction. It's been a while since I've done a corporate call, but I truly look forward to Avenzo being a public company and to many more calls with all of you.

Thank you again for your support. I will now hand the call back to the operator. Operator, you can now conclude the call.

Thank you. Ladies and gentlemen, this does conclude our conference call for today. All parties may now disconnect.

Good morning, and welcome to the Rallybio Corporation conference call to discuss the merger of Rallybio and Candid Therapeutics. It is now my pleasure to turn the call over to Dr. Stephen Uden, Co-Founder and CEO of Rallybio.

Thank you, and good morning. Before we begin, I'd like to remind you that this discussion will contain forward-looking statements based upon the current expectations of Rallybio and Candid, which include, but are not limited to, statements regarding the expected timing, completion, effects and intended outcomes for the proposed transactions and our future expectations, plans and prospects for the combined company, including use of proceeds, expected cash runway and expected milestones.

Such statements represent management's judgment and intentions as of today and involve assumptions, risks and uncertainties. Except to the extent required by law, we do not undertake any obligation to update any forward-looking statements. We also caution you against placing undue reliance on any forward-looking statements. Further, as indicated on these slides, Rallybio intends to file a registration statement and accompanying proxy statement and prospectus with the Securities and Exchange Commission relating to the proposed transactions. Please be advised to read, when available, these and other relevant documents filed with the SEC. Please refer to the accompanying slides for more details on these forward-looking statements.

I will now turn the conference over to Dr. Ken Song, Chairman, President and Chief Executive Officer of Candid Therapeutics. Ken?

Thank you, Steve, and good morning, everyone. I want to thank Rallybio for their confidence in our mission and for the collaborative spirit they have brought to this process. We're thrilled to share the Candid story more broadly today and to outline our plans to advance what we believe is the most differentiated pipeline of T-cell engager or TCE therapeutics for autoimmune disease and development. Over the past 15 years as a serial entrepreneur, I built companies around a consistent theme, find areas where clinical or technical data already supports and helps derisk the compelling opportunity, yet broader conviction has not yet caught up with the science.

My first company, Ariosa Diagnostics, ventured into liquid biopsy in 2009. More recently, in 2020, I launched RayzeBio, a radiopharmaceutical company for cancer. Both of these areas were not popular within the industry at the time of founding. Following the acquisition of RayzeBio by Bristol-Myers Squibb in early 2024, I again went searching the broader industry landscape for things that seem to work but weren't getting the attention I felt they deserved. Clinical data using CAR-T cell therapy in autoimmune diseases showed the ability to reset the immune system, leading to significant clinical benefit.

However, the pursuit of TCEs, which can mimic CAR-T effects were largely being ignored despite TCEs having several clear advantages. After evaluating numerous clinical stage TCE programs globally, which were initially being developed in oncology, we identified 2 assets, Cizutamig, our BCMA TCE and CND261, our CD20 TCE, which we in-licensed to focus development in autoimmune diseases, then built an initial team and secured funding to formally launch Candid Therapeutics in September 2024. Our founding conviction was straightforward. TCE antibodies have the potential to be a transformative modality in autoimmune disease, capable of achieving deep B-cell and plasma cell depletion in a scalable outpatient-friendly manner.

Since founding Candid, the field has evolved rapidly with clinical data now showing the potential of TCEs in autoimmune diseases. We run Candid with a mindset to play to win and be the leader for TCEs in autoimmune diseases. To accomplish this, we had hyperfocused on execution with the following results: First, an expanded TCE portfolio. In addition to Cizutamig and CND261, we have built up our TCE portfolio with 2 additional trispecific TCEs. CND319, which targets CD19 and CD20 and is poised to enter first-in-human clinical trials by the middle of this year; and CND460, which targets BCMA and CD19 and is expected to enter first-in-human clinical trials in the first half of 2022. Second, lead decision-making with clinical data.

Since dosing our first autoimmune patient in the spring of 2025, we have now dosed over 70 patients with autoimmune disease with our TCEs. This clinical experience has been invaluable in allowing us to be data-driven to make decisions. Part of our success in generating clinical data has been through establishing a team in China to take advantage of the operational and financial efficiencies for clinical studies in China. Thirdly, advance into mid-stage clinical development. Based on clinical findings, we are prioritizing the development of Cizutamig into several global Phase II clinical studies in myasthenia gravis and interstitial lung disease.

In addition to the immune reset strategy with our TCEs in which we look to deeply deplete B-cells and plasma cells for a one-and-done approach to achieve long-term disease remission, we have also put forth the concept of immune dimming, which targets partial depletion. With immune dimming, we would expect intermittent TCE dosing that provides superior efficacy over standard of care with a strong safety profile. The immune reset and immune dimming approach, we believe, is unique to TCEs and both can be pursued in parallel as they are not mutually exclusive. Our lead program, Cizutamig, is a BCMA TCE that we view as a potential first and best-in-class drug candidate for autoimmune disease.

We have dosed 47 autoimmune patients across multiple indications with global Phase II studies in myasthenia gravis and interstitial lung disease expected to initiate in mid-2026. The data we have generated to date are encouraging across 3 dimensions: one, deep B-cell and plasma cell depletion. Based on lymph node and bone marrow biopsies taken from 4 patients treated with Cizutamig, we have shown deep depletion of B-cells as well as plasma cells, suggestive of an immune reset effect. Two, clinical activity.

Across multiple disease indications, we are seeing consistent decreases in autoantibodies and more importantly, clinical responses. For generalized myasthenia gravis, in our Phase I multicenter dose trial in China, we have observed significant improvements in QMG and MG-ADL scores, which are physician and patient assessments of disease activity, respectively. In highly refractory patients with interstitial lung disease due to systemic sclerosis, we have treated 2 patients as part of compassionate use and seen improvements in lung function in each patient as measured by increases in forced vital capacity. Thirdly, a good safety profile.

Across 47 patients with autoimmune disease who have received Cizutamig, the overall rate of cytokine release syndrome, or CRS, has been less than 15% with all cases being mild. There have been no unexpected treatment-emergent serious adverse events. Beyond this, for targeting of B-cells, we have 2 drug candidates: CND261, a CD20 T-cell engager, which is in clinical trials; and CND319, a dual targeting CD19 and CD20 TCE, which is expected to start first-in-human testing in the middle of this year. CND261 has also shown deep B-cell depletion in lymph nodes of patients with autoimmune disease with good tolerability.

We see tremendous potential for TCEs to be a leading modality for autoimmune diseases. At Candid, we are hyper-focused on execution to generate clinical data to guide further decisions and development of our TCE programs so that these drug candidates can reach patients globally as quickly and safely as possible. This over $500 million capital raise in addition to our current cash on balance sheet is expected to provide sufficient runway to advance multiple programs through Phase II and into pivotal registrational studies, assuming positive Phase II data. Thank you to all the employees, advisers, business partners, physicians, patients and investors who believe in our mission and join us on this TCE journey.

This concludes my remarks, and I will now hand the call back to the operator.

This now concludes the webcast. Thank you.