S2, E6: iOmx and shaking up the immuno-oncology field with CEO Apollon Papadimitriou, Professor Phillip Beckhove (RCI) and Jared Holz (Mizuho)

[00:00:00] Welcome to the Raising Biotech podcast, I'm your host, Surani Fernando and thanks for tuning in. This podcast has a mission of exploring biotechs raising impressive funds to develop ambitious medical breakthroughs. I speak with CEOs and founders to get origin stories, missions,

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[00:01:06] Today we're finally diving into the scary zone of cancer, exploring the fascinating story of German biotech Iomics. The company has raised a total of 115 million euros in a series A and B since its inception in 2016, and with its noble screening platform is hoping to

[00:01:28] take immunocology drug development to a whole other level. Joining me on the podcast is CEO of Pollan Pappademytrio, who talks about the company's technology, investment story, progress in clinical trials, as well as future strategic for the company, including a potential IPO. I'm also joined by Professor Philip Beckhover,

[00:01:52] director of the Regensburg Centre of Interventional Immunology at the University of Regensburg in Germany. He's the expert humour immunologist behind Iomics's origins, and he gives us a play by play of his findings before they became the foundations for a new and highly

[00:02:10] sought after cancer company. He also speaks about how these drugs can possibly differentiate and fill in unmet need, where the current oncology landscape falls short. I'm also joined by Jared Holtz, Helpcare Equity Strategist at Nizyu Ho Securities, who gives us his take on

[00:02:28] the company's story with more of an investment community lens, as the company navigates many interesting investment decisions. I hope you enjoy the episode. Hi, Pauline. Thanks for joining the podcast. Hi, Sirani. Nice to meet you. Pleasure to be here.

[00:02:42] So just to start us off, can you just give us the crux of Iomics's platform and lead compound and why it's so novel and differentiated in the current landscape? Yeah, sure. Absolutely. I mean, we are working in a field that has been a next wave

[00:02:59] kind of in cancer treatment, its immun oncology. And it may as heard of the successes that certain products have delivered. And immun oncology has been helping a lot of patients. Actually, you know, the new drugs have revolutionized the way not only how we are treating

[00:03:18] cancer patients but also how we are thinking about cancer biology. Immuno-oncology has been a game changer in cancer treatment by using the immune system to fight tumors. The landscape really took off in the mid-2010s with PD1 and PDL1 inhibitors

[00:03:37] like Merch's KTRUDA and BristlemyaSquibs Optivo both huge multi-billion dollar drugs which have helped many patients across a number of different cancers. Before this, cancer was mainly treated with chemotherapy, radiation and surgery. These new drugs have led to exciting innovations

[00:03:56] like combination therapies and other immun oncology drugs known as checkpoint inhibitors. But here's the kicker, around 90% of cancer patients still don't benefit from these treatments. So while we've made huge strides in the field, there's still a lot of work to do to make

[00:04:14] these therapies work for everyone. And then the key question was what is next? Are there other pathways that you know in EBIT tumor immunoscabe? Can we identify those and can we tackle them with completely novel drugs? And that's exactly the mission of IOMICs. You know, we have a

[00:04:34] technology that allows us to identify novel immunoscabe pathways, pathways that the tumor uses to hide from the natural immune system and if you identify such novel pathways, can we track them? And this is exactly our platform, with a technology that allows us to screen

[00:04:55] for new targets by a genetic knockout system that is indeed knocking out each individual gene of the human genome one by one either in a tumor cell or in a myeloid cell or in other

[00:05:09] immune cells in the tumor microenvironment and then we are looking for enhanced activation of active immune cells, the T cells that are actually then driving the tumor cell killing and that is our technology. So let's go back to the very beginning. Before the company was unveiled in 2016

[00:05:29] and before a pollin joined the company, IOMICs' story came out of the German Cancer Research Centre, the DKFC. It's a very renowned Institute in Germany. There are a lot of cancer researchers there and two of them were Professor Philipp Beckhoffel and here are a PhD student, Nishit Kandelwald

[00:05:49] and they were working in the field of immun oncology. So I was also able to speak with Professor Phillip Beckhoffer. Whilst he's the scientific founder of IOMICs, he never fully switched over to any

[00:05:59] full-time industry executive role instead choosing to remain in academia but he does keep him touch with IOMICs as a scientific advisor. So I am a physician, medical oncologist, I train him and very early

[00:06:15] throughout my career I found that it is very it's frustrating to have advanced age cancer patients in the clinic treated with insufficient or not really effective treatments. He decided to then

[00:06:31] dedicate more of his time in the lab as a tumour immunologist at the DKFC leading a group of scientists that were analyzing the spontaneous interactions between a patient's immune system, mainly T cells and tumours. I went further into analyzing under which conditions T cells can really

[00:06:55] destroy the tumour cells of their own tumour and then I found that even in the case of a strong cytotoxic T-cell response, tumours often are often resistant against the cytotoxic attack and they survive this. Earlier it was thought that you could just increase the amount

[00:07:14] of cytotoxic T cells in the body to control tumour growth but this wasn't proving to be the case as tumours were still surviving a full-blown killer T cell attack. So Professor Beckhoffer's lab gripped developed a broad high throughput screen and unveiled hundreds of genes that strongly impact

[00:07:35] tumour cell resistance against an immune attack. The key message is that on the one hand side tumours cells can control the activity of cytotoxic T cells but there is a much larger and also much

[00:07:51] stronger level of endogenous immune resistance which is triggered by a lot of intracellular enzymes kinases for example. These different enzymes or kinases can prevent that killing signal of the cytotoxic T cell or even worse convert that signal into a signal that actually makes the

[00:08:15] tumour grow. When you think about it that's kind of insane and puts a whole new spin on the phrase cancer is evil. So Professor Beckhoffer's team found this super interesting to hack into and actually the company's first drug tries to prevent any conversion into a signal that makes

[00:08:34] the tumour grow by blocking the kinase perpetrator. By blocking this we could show that there is more than tenfold increase of cytotoxic capacity against the tumour cell in this blockage situation than with a white-up tumour cell. So this is what motivated us and when we came up with

[00:08:56] the first hostels and then publications on our screen and on the mechanisms that we found be very approached by investment companies and their representatives on the respective Congresses for example at the ACR. Well they suggested that maybe investment into a new company

[00:09:17] would be possible and would make sense and this actually at that time fitted exactly our our point of view and this is how Iomics was then found it. That ACR U.S. cancer conference was in 2015

[00:09:30] and Iomics was founded in 2016 with the series A Round of 40 million euros led by MPM Capital and Serfinova partners with other investors including Wellington partners and Merck Ventures. A few things that struck me when hearing this story is that 40 million euros is quite a lot

[00:09:50] for a series A for a European company and I was surprised to hear that the company didn't have to go knocking on doors begging for its first investors. Professor Becovers said that team did have some preliminary discussions with some local Germany investors in 2014,

[00:10:06] but they were told it was a bit too premature given it was a platform to identify new targets. But over the course of a year the immunocology field was moving fast, allowing the company to

[00:10:17] accelerate it search for new targets and the rest is history. They were able to generate an attractive investment story and as it turned out they had a couple of options to choose from. There were two different approaches from two different sides. One was basically the U.S.

[00:10:34] based investor company. That would be MBM Capital based in Boston. And the other one was a strategic investor coming from a farmer company who were both interested to develop this together with

[00:10:48] us so we could finally make a decision home to choose and we decided then to go for investment that is let's say already big enough involved, you know, allow us to go through the entire

[00:11:02] development. So the company was born. As Professor Becovers didn't join the company in any leadership role feeling he was more useful to society as an academic, the company hired a leadership team and scientific team where a pollin was hired in 2017. First as chief development officer

[00:11:20] setting up the pipeline and driving the drug development and he was later elevated to the CEO role in 2019. A pollin comes from a long career within Big Farmer specifically rose for 22 years.

[00:11:33] I asked him what can tell him to leave his cushy farmer position to work with a new biotech? I was fascinated about the idea to start a biotech that focused exactly on this very, very hot topic.

[00:11:49] And I was convinced about the technology I was convinced about. The team that was existing, the team that was there was so passionate and so intriguingly scientific. And I thought this is

[00:12:01] something I want to engage with. And of course it was not easy, you know, to switch from a big farmer into a biotech. But I thought I'm bringing the right experience to be as quick as possible

[00:12:12] and to have seen things before and drive things into the right direction. And I believe I can help to be successful. We spoke about the early days and how the company needed to really focus its R&D mission in line with the current immunocratology landscape and unmet need.

[00:12:30] I mean at the beginning we had a lot of targets, you know, you have a lot of targets that come out of your screen. And this target at the beginning is gene numbers, right? You don't have a link

[00:12:42] into the biology. And so the first task was what is the biology of a given target that we identify? Can we dig deeper and identify what are the key drivers, what role does it play? How does

[00:12:54] it compete with PD1? Is it independent of the existing targets? Can we describe it in a better way and can we develop a very, very focused plan with respect to drug discovery? And that was I think

[00:13:12] the very early stage to come away from the target only and to kick off true programs, drug discovery programs with a very focused approach, bringing in the biologics expertise, you know, to find the right antibody. So we build up the whole team around antibody discovery

[00:13:30] and antibody engineering and have the biologists select the best antibody. And that was something we did very successfully and we drove a certain amount of programs to the right level. That right level at the early stages of the company was showing that their lead drug candidates

[00:13:49] were convincingly working against tumors in animal models. We had exciting animal data, we had a biomarker that's something I also you know, regard as very important to understand as early as possible, what will be my responsive population in which indications will this drug work?

[00:14:11] Can we define this on an indication level or can we define this on a molecular level, meaning a personalized level? In the end it's about do we have the right copulation to be treated

[00:14:24] with our drug where we understand that this drug has a chance in in a given population? And we had the data, you know, we for our lead compound actually it's a dual targeting compound

[00:14:36] that on the one hand drives the immune system working against the tumor. On the other hand it also works directly against the tumor. So we had the nice data, we had a very clear understanding

[00:14:48] in which populations we will see efficacy signals that's extremely important and we had the right biomarker not only from monitoring pharmacodynamics to see what is the drug doing by logically in a human system but also to be able to select the right indication and eventually also if you

[00:15:07] have a chance of the right patient. And this is a gene signature that we developed that allows you based on an expression pattern in your patient, in the tumor of the patient, to select the sensitive versus the non-sensitive. And if you have this understanding, of course,

[00:15:25] this is extremely helpful to see efficacy signals and to treat the right patient population. So with a convincing proposition it doesn't change the fact that the immunoconology field is now a crowded space, originally with some amazing breakthroughs and then some lackluster

[00:15:41] second generation attempts. I was curious as to how Iomics was able to position itself with investors. That's a very good point because we have to be very true and also looking to what happened in the following years after an initial hype. What happened with the next generation

[00:16:00] programs, the second generation program? And there was a bit of a setback I would say because everyone was trying to combine his new drug with existing drug, Kitruda. And most of the pathways and the targets that had been identified at this stage were drugs that were

[00:16:19] working mostly only in combination. So they were adding an additionally effect to an existing effect. And that was kind of not the right way, of course, eventually some of them were successful, but many studies had failed. And then our approach was completely different because

[00:16:37] we were coming with the idea, we have targets that first of all, independent of the existing known targets. So completely novel biology or forgonal meaning independent in a completely different direction than the existing PD1 PDL1 axis. And the key remit was monotherapy efficacy, not trying to

[00:17:00] combine your existing drug with something else, your new drug with something else, but rather drive single-edged efficacy in a clinical setting. And that were the hallmarks of the iomics strategy and also with the data that we had generated, showing that we can work independent of PD1,

[00:17:19] we can work in indications where PD1 is not working and we do not need a PD1 react as in monotherapy that was I think the compelling story behind it. So the company had a clear plan with how a phase

[00:17:33] one would look like for its lead compound, but also a plan for a pipeline which brought interest from new investors. New investors were fascinated about the pipeline approach about doing this again and the potential to have a machinery working that delivers continuously per year a new entry

[00:17:53] a new clinical candidate and that was fascinating to the investors for the series being investment. So the company raised 65 million euros in October 2021 led by a thos service and MIG capital along with the existing investors from the series A. And that was later expanded to 75 million

[00:18:14] euros in 2023. And a pollin said that the series B would allow the company to take its lead compound through its initial phase one studies, as well as get its second compound a dual targeting monoclonal antibody ready for clinical testing. That later expansion also allowed the company to accelerate

[00:18:33] some of its additional discovery programs running in the background. So let's dive a bit deeper into IOMIX's lead candidate OMAX 407, a multi-targeting sick inhibitor and they already have some signals in their phase one safety study which started in early 2023. Back then the company managed

[00:18:53] to convince the authorities to let them start the trial with a higher than normal starting dose, as well as conduct a much faster dose escalation compared to what's usually allowed in cancer trials. This allowed the company to kickstart and move its program quite swiftly through the

[00:19:11] dose escalation phases. And the program is now in the fifth cohort right? So we have increased the dose already 14 fold from the get-go. And I mean it's very nice that the drug is very well tolerated. We see nice pharmacokinetics as expected. We also can monitor pharmacodynamics in a

[00:19:32] PBMC as say in a blood essay to see targeting engagement and target down modulation. And we have a very good understanding that we are all ready now at a relevant dose, a dose that has a chance to

[00:19:45] show anything. I think this is nice and this is expected and this is something you would of course like to see. But on top of this we also have a very nice responder patient already in

[00:19:57] an all-comers trial where you wouldn't expect to see any strong responders because the population is not pre-selected. So this all-comer trial includes patients with different types of cancer. The responder that OMAX is talking about is a lady suffering from angiosarcoma, a rare cancer

[00:20:14] that develops in the inner lining of blood and limb vessels, often looking like a bruised area on the skin which can swell over time as the cancer grows. The Sanitavka is chemotherapy and this particular patient was chemotherapy resistant. And we brought her into our study. She

[00:20:33] was getting 10 weeks at the beginning of low dose where we expected not to be ineffective dose. The tumor progressed within one cycle, within four weeks of treatment and then we said, why don't we escalate it to the next level? We brought her up to a three-fold higher dose.

[00:20:50] And then eventually after three weeks of her under drug with this higher dose, she started to be responding and that is such an enormous response. She continued to be responsive the response deepened over time. And then five months back we decided, why don't we escalate

[00:21:10] her further to 60? And since then she's having a normal life, she is a near-complete response. We can simply not say it because the next scan is due in May but you know from a visual inspection,

[00:21:24] you could not see any too many more. The lady was last line no chance ever and now she's doing a wonderful life and the duration is now already 11 months. And this is very impressive

[00:21:36] and this fits very nice into our mouth data, the animal data that we have generated, where we saw you know, a striking in effect in this disease. And that brings one and one together,

[00:21:48] you can always challenge predictive power of animal models. And in this case it really was like like a dream coming true and that is a path that we would like to follow on top of other

[00:21:58] priority indications that we have identified. So it keeps us very optimistic that you know, once we kick off the next stage, the phase 1B, there's efficacy arm of this trial,

[00:22:09] we have you know a high chance to be extremely successful. Yeah I think I saw some of those pictures when I spoke with Nells and it was pretty impressive. So like in terms of the indications,

[00:22:21] that's something that you'll keep an eye on that's a rare disease, right? Do you have an idea what indications you want to go into or will you decide that after the phase 1B?

[00:22:33] No, we are very decided on that and you know this ready-sees is topping the whole story. Right? It is not our priority focus, right? Of course we want to access bigger patient populations

[00:22:45] and we have all the data and we are ready to start the phase 1B in real-style carcinoma as one example and in scramusnonsmosaluncensor and we have a lot of other priority indications on the

[00:22:58] table that are strongly supported by our in-pregnantical data and biomarker data, but we do not want to miss the opportunity in this ready-sees indication for a fast-to-market strategy to simply complement our overall strategy. So we have real on the table and we have scramusnonsmosaluncensor

[00:23:18] on the table and we have a few other solid two main indications on the table and angiosacoma will top this up. Professor Bechova believes the technology has a wide application and the company will just have to be strategic with what they tackle first,

[00:23:32] perhaps starting where they have more confidence on success like this rare cancer and then gradually moving in a stepwise fashion to the more harder to treat cancers. I mean we know that the big needs are the hard-to-treat cancers and that they are basically

[00:23:47] known personally I am very interested in pancreatic cancer and advanced coloractual cancer also these are let's say cancer types where I have expertise particularly on heal some mentioned potential in triple-negative breast cancer as well as treatment resistant

[00:24:03] non-small cell lung cancer where he sees a real unmet need for patients. So let's get a complete outside as take on this looking more through the lens of the healthcare investor community. I spoke with Jared Holt, healthcare equity strategist at Mizzouh's

[00:24:21] securities and a regular capital markets commentator on various programs like CNBC. He's an all-contactive mind back from my time in New York and we'd often just bounce ideas on what's going on in the industry. I knew he knew the immunocology field well and given

[00:24:37] he has this unique investor perspective I was curious about his high level thoughts on this story obviously without having seen any meaningful data. My like initial thoughts are like it's still early like I think categorically it's intriguing we need some other therapies other than

[00:24:54] ketruda at the end of the day and the entire industry or a good portion of the industry is vying for positioning within tumor types where ketruda or updivo have not worked or they've

[00:25:08] not as well as in other indications. And so here we are with hundreds of early stage biotech companies that are still very focused on a immunotherapy either as a junked of therapies or as monotherapy isn't it's been pretty challenging as a monotherapy because of how well

[00:25:28] Io and chemo have worked in tandem but there's still a lot of opportunity and obviously we're really just scratching the surface in terms of identifying all of the biomarkers in which these drugs are going to work. I think monotherapy is always going to be

[00:25:45] the primary goal but I think there's a secondary goal in which survival data look better using a drug and combination so there are several ways to win here and we'll just kind of

[00:25:56] had to see how the data look over time. From an investor perspective Jarod said the company strategy to tackle a rare indication first followed by larger indications like renal cell carcinoma makes a lot of sense and decisions would ultimately be driven by the strength of the

[00:26:12] data sets and the competitive landscape. When I look at the company there are a lot of shots on goal here so they're probably have some decisions to make down the line and then I think a lot

[00:26:21] of it comes down to you know level in investment versus what is already commercially available. I also asked Jarod about his first impressions of the investor base because that was something that got my attention when choosing to explore this company. Yeah I think the investors that I saw

[00:26:37] that had put money in the company in its infancy stage was very strong and I think that you know other other investors and healthcare that look at that kind of syndicate I think will be pretty impressed. Moving forward with the company's financing efforts

[00:26:53] a pollin mention the company is thinking about a near-term series see financing with eyes towards the future IPO depending on the market appetite and how its own data reads out

[00:27:04] over time. We want to close this series here by end of the year to help us to bring the company to the next stage and the next stage will be a very attractive stage because if you think about

[00:27:15] IPOs we understand the markets have been down over the last two years now we realize a little comeback in the public markets you know at least for the first quarter let's assume that the IPO

[00:27:28] window will open up more and more right and let's assume we are successful and see more clinical signs of efficacy already next year that could open an IPO window for our IOMX but even after

[00:27:44] clinical proof of concept with our pipeline approach I think we would be ready also for an IPO in 2026 and at that stage the markets made it back I do not know the trends are

[00:27:57] hinting into this direction but this is a wonderful opportunity for us. I asked Jarrett to weigh in with his thoughts on the potential investor appetite around IOMX's story particularly given how stress the capital markets have been over the last year or so. There's definitely a pretty

[00:28:13] sizable appetite a lot of the oncology companies that have started up over the past decade of gotten acquired I do think there is there's obviously going to be strategic interests from all the major farm accompanies and most of them you know have substantial oncology hematology arms

[00:28:33] to begin with so I feel like from an investor standpoint when we're not looking at it strategically there is there's viable opportunity if you can show minor therapy efficacy in some of these two

[00:28:45] more types and and really have survival data that's viewed as good or excellent there's a place in the market I mean I think investors in biotech and health care will always have capital that they're willing to commit to companies that show you know promising early stage efficacy

[00:29:02] and oncology I think this could be a prime example here and I think longer term there is a there's a strategic interest kind of perpetually in this area because the likes of Merck and Bristol and Jane J. etc are always looking for kind of like ancillary assets that

[00:29:19] they can fit in and I think that's probably what I see here over the long term and as the founding father of this story I was curious as to what Professor Bekhova wished for the company's future

[00:29:31] for me it's important that that this makes its way to hopefully an approval so that patients really benefit later on from these developments that's the motivation of an academic researcher to develop something that that really has an impact on health care systems. I personally I am

[00:29:49] relatively agnostic here so it can be an IPO that allows the company to develop their own portfolio further it could also be in alignment with the larger farmer company that provides

[00:30:03] the resources to do this maybe quicker or easier or with more impact if it comes to an acquisition I think that's for me that is both fine the most important question is how do we bring

[00:30:18] the portfolio into the clinic best. And as I usually ask see years at the end of each episode I got a poll in five year vision for the company where its pipeline could possibly be and

[00:30:30] whether that pipeline might be growing under iomics as a publicly listed company or under a big farmer. That's a very good question and that meets a lot of alignment with existing investors

[00:30:42] and with new investors but look for the time being we have both right we have a big vision for the company maybe this angiosacoma fast to market in an often disease is a chance to really

[00:30:55] become a fully integrated company you don't need the ultra huge super sales force because it's a rare disease right but this is dreams right but it's tangible right it's tangible and this is something we can easily decide within the next two years where would the next step go

[00:31:12] for assuming a clinical proof of concept in this rare disease? On a long term of course at a certain stage the typical exit is that somebody acquires your lead asset and then with this

[00:31:25] concomitantly acquires the whole company I think for me it's clear we need to keep all opportunities open as long as possible and to drive the company into directions so that we can follow multiple paths keep the options for multiple paths open as long as possible

[00:31:42] and to take the decision as late as possible of course in my vision in my personal vision I would love to do this again and again and again we have the power to do so we have the

[00:31:53] technology to do so and I think we can continue generating value repeatedly several times with more money we could do more projects and if we bring money in through the first project

[00:32:04] we can use the money to drive a second and a third in a fourth program that would be a dream and that would be something that for me is still realistic and something we could achieve

[00:32:18] so that's it for another episode of Raising Biotech a very intriguing scientific story in a huge area of innovation and unmet need and looking forward to following the company over the next month and year which will know doubt be packed with some super meaningful milestones

[00:32:36] thanks to my guests a pollen pepper dumechu professor philipp beckove and jarred holes for their valuable insight and expertise and thanks to wall for listening in that was a final episode of Raising Biotech for Season 2 I'm currently mulling over how to

[00:32:52] bring you all season 3 but in the meantime if you liked this episode if you can do me a huge favor subscribe share this podcast around give it a five star review and rating on either apple

[00:33:03] or Spotify and also join the LinkedIn page for more updates for when season 3 will be launched for now I'm seranie vanando thanks for listening and thanks for your support for raising biotech