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Item 1. Business

2021-02-25 compared with 2020-03-02 · 342 added, 296 removed, 493 unchanged (56% of the section changed)

We are a clinical stage biotechnology company developing first-in-class immunology therapeutic product candidates to patients.

We are focused on emerging immune control mechanisms applicable to inflammation and immuno-oncology indications.

We develop our product candidates using our proprietary antibody discovery technology platform, which is based upon a breakthrough understanding of the natural process of antibody generation, known as somatic hypermutation, or SHM, and replicates this natural process of antibody generation in vitro .

We are a clinical stage biotechnology company developing first-in-class immunology therapeutic product candidates focused on emerging immune control mechanisms applicable to inflammation and immuno-oncology indications.

We develop our product candidates using our proprietary antibody discovery technology platform, which is based upon a breakthrough understanding of the natural process of antibody generation, known as somatic hypermutation (“SHM”), and replicates this natural process of antibody generation in vitro .

Our strategy is to advance the development of our proprietary product candidates, and where applicable, establish partnerships with leading biopharmaceutical companies where we retain certain development and commercialization rights.

Our most advanced wholly-owned antibody programs, etokimab, ANB019, ANB030 and ANB032, are designed to modulate therapeutic targets that are genetically associated with human inflammatory disorders.

Etokimab inhibits the activity of the interleukin-33 cytokine, or IL-33, which we believe is broadly applicable to the treatment of respiratory disorders.

We are conducting a randomized, placebo-controlled Phase 2 trial of etokimab in approximately 100 adult patients with CRSwNP, also referred to as the ECLIPSE trial, which is a debilitating atopic disorder associated with elevated IL-33 pathway signaling.

We anticipate interim top-line data from this trial to be available in the first half of 2020.

We have previously completed a Phase 2a randomized, placebo-controlled, single dose study of etokimab in 25 severe adult eosinophilic asthma patients.

We presented full data from this trial at the 2019 European Academy of Allergy and Clinical Immunology (EAACI), which demonstrated that a single dose of etokimab resulted in rapid and sustained lung function improvement as measured using Forced Expiratory Volume in One Second, or FEV1, patient reported outcomes associated with asthma symptoms, as measured using the Asthma Control Questionnaire 5.

As a result of our recently completed Phase 2b etokimab ATLAS trial in moderate-to-severe atopic dermatitis, the Company has decided to discontinue further clinical development in atopic dermatitis.

We have also postponed initiation of a previously announced Phase 2b etokimab clinical trial in eosinophilic asthma until data is available from the aforementioned ECLIPSE trial.

Our ANB019 antibody inhibits the interleukin-36 receptor, or IL-36R, and is being developed for the treatment of rare inflammatory diseases including generalized pustular psoriasis, or GPP, and palmoplantar pustulosis, or PPP.

We completed a Phase 1 clinical trial in healthy volunteers, which was presented at EAACI 2018, where ANB019 was well-tolerated by all subjects, no dose-limiting toxicities were observed, and no serious adverse events were reported among any subjects in the trial.

We are conducting an open-label, multi-dose, single-arm Phase 2 trial of ANB019 in up to 10 GPP patients, also referred to as the GALLOP trial, where an interim analysis, announced in September 2019, was conducted after the first two patients completed 16-weeks (Day 113) with ANB019 monotherapy.

Both patients achieved the primary endpoint of disease improvement at Day 29 and Day 113 without requiring rescue therapy.

Patients demonstrated rapid and sustained modified Japanese Dermatology Association (mJDA) improvement and complete clearance of skin pustules from Day 8 through Day 113.

C-reactive protein, or CRP, levels decreased to nearly normal in both patients and genotypic testing of these two patients indicated that ANB019 may be broadly applicable to pustular disease patients without a requirement for genetic screening.

Enrollment is ongoing in GALLOP and we anticipate additional clinical data and a regulatory strategy update for the development of ANB019 in GPP during 2020.

We are also conducting a randomized, double-blind, placebo-controlled approximately 50-patient multi-dose trial of ANB019 in PPP, also referred to as the POPLAR trial, where top-line data are anticipated in the second half of 2020.

Our third wholly-owned program ANB030, an anti-programmed cell death protein 1 (PD-1) agonist antibody program, is designed to augment PD-1 signaling through ANB030 treatment to suppress T-cell driven human inflammatory diseases.

Genetic mutations in the PD-1 pathway are known to be associated with increased susceptibility to human inflammatory diseases, and hence we believe ANB030 is applicable to diseases where PD-1 checkpoint receptor function may be under-represented.

Preclinical data for ANB030 was presented at the 2019 Federation of Clinical Immunological Societies (FOCIS) Annual Meeting in June 2019.

We submitted an Investigational New Drug Application, or IND, for ANB030 in the fourth quarter of 2019 and anticipate initiation of a Phase 1 healthy volunteer clinical trial in the first half of 2020.

Our fourth wholly-owned program is an anti-B-and T-lymphocyte attenuator, or BTLA, modulator antibody, known as ANB032, which is broadly applicable to human inflammatory diseases associated with lymphoid and myeloid immune cell dysregulation.

Mutations in the BTLA signaling pathway are associated with human inflammatory disease and we believe ANB032 silences pro-inflammatory signaling by modulating BTLA binding to herpes virus entry mediator, or HVEM.

We anticipate filing an IND for ANB032 in the second half of 2020.

In addition to our wholly-owned antibody programs, multiple AnaptysBio-developed antibody programs have been advanced to preclinical and clinical milestones under our collaborations.

Our most advanced wholly-owned antibody programs, imsidolimab, ANB030 and ANB032, are designed to modulate therapeutic targets that are genetically associated with human inflammatory disorders.

Imsidolimab, our IL-36R antibody previously referred to as ANB019, inhibits the interleukin-36 receptor (“IL-36R”), and is being developed for the treatment of multiple dermatological inflammatory diseases.

We completed a Phase 1 clinical trial in healthy volunteers, which was presented at the European Academy of Allergy and Clinical Immunology in 2018, where imsidolimab was well-tolerated by all subjects, no dose-limiting toxicities were observed, and no serious adverse events were reported among any subjects in the clinical trial.

In July 2020, the U.S.

Food and Drug Administration (the “FDA”) granted Orphan Drug Designation for imsidolimab for the treatment of patients with GPP.

We are conducting an open-label, multi-dose, single-arm Phase 2 clinical trial of imsidolimab in 8 GPP patients, also referred to as the GALLOP clinical trial, where we announced positive topline data in October 2020.

Six of 8 (75%) patients treated with imsidolimab monotherapy achieved the primary endpoint of improvement in the clinical global impression scale (“CGI”) on Day 29.

Two of 8 (25%) patients were considered to have not met the primary endpoint because they dropped out of the clinical trial prior to Day 29.

The modified Japanese Dermatology Association Severity Index (“mJDA-SI”) score, which incorporates both dermatological and systemic aspects of GPP, decreased on average by 29% on Day 8 and 54% on Day 29.

Erythema with skin pustules, which clinically defines GPP, decreased by 60% on Day 8 and 94% on Day 29.

Serum c-reactive protein (“CRP”), which is an indicator of systemic inflammation, was normal (less than 5 mg/L) for 5 of the 6 patients achieving the primary endpoint on Day 29.

Genotypic testing indicated homozygous wild-type IL-36RN, CARD14 and AP1S3 alleles for all 8 patients.

We believe this suggests that imsidolimab may be broadly applicable to pustular diseases irrespective of genetic drivers.

Anti-drug antibodies were not detected as of Day 29 in any patient.

Imsidolimab was generally well-tolerated, and most treatment-emergent adverse events were mild to moderate in severity and resolved without sequelae.

No infusion or injection site reactions were observed.

One patient dropped out of the trial due to a diagnosis of Staphylococcal aureus bacteremia in the first week, which was a serious adverse event deemed to be possibly drug-related.

Because the patient was symptomatic prior to dosing and had a prior medical history of bacteremia, a common comorbidity of GPP, we do not believe this event is likely attributable to imsidolimab.

Another patient dropped out of the study on Day 22 due to investigator reported inadequate efficacy.

One patient contracted COVID-19 during the course of the clinical trial, which was mild, unrelated to imsidolimab, and did not lead to study discontinuation.

Data from the first two patients to have completed the Day 113 treatment period under this clinical trial, which we announced in September 2019, indicated sustained efficacy in these two patients through Day 113.

We plan to report full data from the GALLOP clinical trial at a medical conference in 2021.

While initial GPP epidemiology studies suggested at least 3,000 patients in the United States, recent medical claims analyses suggest GPP prevalence in the United States of at least 10,000 patients.

We met with the FDA during the fourth quarter of 2020 to review an orphan disease registration plan for imsidolimab for the treatment of GPP and anticipate initiating a Phase 3 clinical trial in mid-2021 following completion of protocol alignment and review of 16-week data from the GALLOP clinical trial by the FDA.

We are also conducting a randomized, double-blind, placebo-controlled 59-patient multi-dose clinical trial of imsidolimab in PPP, also referred to as the POPLAR clinical trial, where enrollment was completed in 2020 and top-line data are anticipated in the first quarter of 2021.

The primary endpoint of this clinical trial is change in palmo-plantar pustulosis area severity index (PPPASI) at week 16 relative to baseline.

PPP is a non-fatal form of pustular psoriasis that we estimate affects approximately 150,000 patients in the United States alone.

We have initiated a global registry of GPP and PPP patients, also referred to as the RADIANCE study, which we anticipate will improve understanding of the patient journey in these two indications and assist in enrollment of future GPP and PPP clinical trials.

We have initiated clinical development of imsidolimab for the treatment of skin toxicities associated with treatments with inhibitors of epidermal growth factor (“EGFRi”) and MAPK/ERK kinase (“MEKi”).

Treatment of solid tumors with EGFRi and/or MEKi is frequently limited by the occurrence of skin toxicities, including acneiform or papulopustular rash.

Recent translational data has suggested that these skin toxicities are mediated by excess IL-36 signaling, leading to IL-8-mediated cutaneous neutrophilia and acneiform rash.

Based on existing claims data, approximately 60,000 patients are prescribed EGFRi and/or MEKi treatments annually, and the vast majority of these patients experience skin toxicity, which in some cases leads to dose reduction and/or discontinuation of treatment.

Current standard-of-care treatments are generally

ineffective in patients with the most severe grades of EGFRi and/or MEKi mediated skin toxicity.

During the fourth quarter of 2020, we initiated a Phase 2 clinical trial, called EMERGE, of imsidolimab in combination with EGFRi inhibitors, for the treatment of patients diagnosed with a certain baseline severity of skin toxicity, where 45 patients are randomized 2:1 between imsidolimab and placebo arms, to assess the efficacy of imsidolimab in the treatment of this indication.

We anticipate interim top-line data from this clinical trial at the end of 2021.

We have also initiated clinical development of imsidolimab in ichthyosis, which is a family of rare, inherited, dermatological disorders characterized by dry, scaling and thickened skin.

Recent human translational studies have suggested that the underlying skin inflammation responsible for ichthyosis is mediated by dysregulated IL-36 signaling, and we believe that imsidolimab treatment may be efficacious in treatment of this condition.

Approximately 6,000 patients in the United States are affected with moderate-to-severe levels of ichthyosis, and no approved therapies are available for this disease.

We have initiated a Phase 2 clinical trial, called INSPIRE, of imsidolimab in patients with certain baseline severity of ichthyosis, where 24 patients are randomized 2:1 between imsidolimab and placebo arms, and interim top-line data is anticipated in 2022.

We plan to initiate clinical development of imsidolimab in hidradenitis suppurativa, also known as acne inversa, which is a chronic inflammatory skin disease characterized by painful nodules in intertriginous areas that can progress to abscesses, sinus tracks and scarring.

Current treatment options for hidradenitis suppurativa, including antibiotics, corticosteroids and anti-TNF therapy, have variable efficacy in moderate-to-severe patients, which often leads to surgery for removal of hidradenitis suppurativa nodules.

Human translational studies have demonstrated elevated IL-36 cytokine expression in hidradenitis suppurativa skin biopsies, and we believe treatment of moderate-to-severe hidradenitis suppurativa with imsidolimab may lead to therapeutic benefit for this patient population.

Moderate-to-severe hidradenitis suppurativa affects approximately 150,000 adults in the United States.

We intend to initiate a Phase 2 clinical trial of imsidolimab in hidradenitis suppurativa, called HARP, in the second quarter of 2021.

We plan to initiate clinical development of imsidolimab in acne, which is the most common skin disorder in the United States, with approximately 7 million patients diagnosed with moderate-to-severe disease.

Moderate-to-severe acne typically presents with painful papules, pustules, nodules, cysts and scarring.

A key contributing factor to the pathogenesis of acne is the immune response to p.

acnes, which is associated with upregulated IL-36 cytokine activity, localized inflammation and neutrophil infiltration of the skin.

Existing therapies, including isotretinoin and systemic antibiotics, provide variable efficacy for moderate-to-severe acne patients and have practical limitations to their use given potential for clinically meaningful side effects.

We anticipate initiating a Phase 2 clinical trial of imsidolimab, called ACORN, for the treatment of moderate-to-severe acne in the second quarter of 2021.

Our second wholly-owned program, ANB030, is an anti-PD-1 agonist antibody program designed to augment PD-1 signaling through ANB030 treatment to suppress T-cell driven human inflammatory diseases.

Genetic mutations in the PD-1 pathway are known to be associated with increased susceptibility to human inflammatory diseases, and hence we believe that ANB030 is applicable to diseases where PD-1 checkpoint receptor function may be under-represented.

We presented preclinical data for ANB030 at the Festival of Biologics Annual Meeting in March 2020, including translational data demonstrating i n vitro activity of ANB030 in alopecia areata patient samples.

We initiated a Phase 1 healthy volunteer clinical trial in the first half of 2020, which is designed to assess the safety, pharmacokinetics and pharmacodynamics of ANB030 in single and multiple ascending dose cohorts.

We anticipate top-line data from this Phase 1 clinical trial in mid-2021.

We plan to initiate Phase 2 clinical trials of ANB030 in alopecia areata and vitiligo in the second half of 2021.

Our third wholly-owned program is an anti-BTLA modulator antibody, known as ANB032, which is broadly applicable to human inflammatory diseases associated with lymphoid and myeloid immune cell dysregulation.

Mutations in the BTLA signaling pathway are associated with human inflammatory disease, and we believe ANB032 silences pro-inflammatory signaling by modulating BTLA binding to HVEM.

We filed a Clinical Trial Notification (“CTN”) in Australia for ANB032 during the first quarter of 2021 and anticipate initiating a healthy volunteer Phase 1 trial in the first half of 2021 upon clearance of the CTN.

We presented preclinical data regarding ANB032 at the 2020 Federation of Clinical Immunology Societies (FOCIS) Virtual Annual Meeting in October 2020.

Etokimab, our anti-IL-33 antibody previously referred to as ANB020, inhibits the activity of the interleukin-33 cytokine (“IL-33”).

We have conducted a randomized, placebo-controlled Phase 2 clinical trial of etokimab in approximately 100 adult patients with CRSwNP (a debilitating atopic disorder associated with elevated IL-33 pathway signaling), also referred to as the ECLIPSE clinical trial.

We recently reported top-line data from a week 16 analysis of the ECLIPSE clinical trial.

Patients dosed with etokimab every four (q4w) or eight weeks (q8w) failed to achieve the co-primary endpoints of statistically significant improvement in their bilateral nasal polyps score (“NPS”), an endoscopic measure of nasal occlusion, and in their sino-nasal outcome test (“SNOT-22”), a patient reported quality-of-life assessment, versus placebo at the week 8 time point.

Both endpoints demonstrated statistically significant improvement over baseline levels of NPS and SNOT-22.

Blood eosinophil levels, which are a biomarker of etokimab’s mechanism, demonstrated statistically significant reduction relative to

baseline in both etokimab treatment arms.

Following this data, we have decided to discontinue further development of etokimab.

In addition to our wholly-owned antibody programs, multiple Company-developed antibody programs have been advanced to preclinical and clinical milestones under our collaborations.

We have received to date approximately $164.6 million in cash receipts from collaborations.

Our collaborations include an immuno-oncology-focused collaboration with TESARO, Inc.

and TESARO Development, Ltd., or collectively TESARO, now a part of GlaxoSmithKline or “GSK”, and an inflammation-focused collaboration with Celgene Corporation, or Celgene, now part of Bristol-Myers Squibb.

A Biologics License Application, or BLA, for our most advanced partnered program, which is an anti-PD-1 antagonist antibody called dostarlimab, was recently submitted by GlaxoSmithKline, and we anticipate FDA approval in the near-term.

Our collaborations include an immuno-oncology-focused collaboration with GlaxoSmithKline, Inc.

(“GSK”) and an inflammation-focused collaboration with Bristol-Myers Squibb (“BMS”).

A Biologics License Application (“BLA”) for our most advanced partnered program, which is an anti-PD-1 antagonist antibody called dostarlimab, was submitted by GSK and accepted by the FDA for the treatment of advanced or recurrent deficient mismatch repair endometrial cancer (“dMMREC”), and FDA approval is anticipated in this indication during the first half of 2021.

This FDA approval is dependent on a pre-approval inspection of the dostarlimab manufacturing site by the FDA and is therefore contingent on easing of the coronavirus (“COVID-19”) pandemic travel restrictions.

In addition, the European Medicines Agency (“EMA”) recently accepted GSK’s Marketing Authorization Application (“MAA”) for dostarlimab in the European Union (“EU”) for dMMREC, and EMA approval is anticipated in this indication during the first half of 2021.

A second BLA submitted by GSK was accepted by the FDA during the first quarter of 2021 for dostarlimab in pan-deficient mismatch repair tumors (“PdMMRT”).

We received a $10.0 million cash milestone payment upon the FDA acceptance of GSK’s first BLA for dostarlimab and anticipate an additional $20.0 million cash milestone payment upon first FDA approval of dostarlimab during the first half of 2021.

We also received a $5.0 million milestone payment for the EMA acceptance of GSK’s first MAA for dostarlimab and anticipate an additional $10.0 million cash milestone payment upon first EMA approval of dostarlimab during the first half of 2021.

An additional $10.0 million cash milestone payment is anticipated by the end of the first quarter of 2021 for acceptance of the second FDA BLA referred to above.

Dostarlimab is currently in clinical development for various solid tumor indications, including dMMREC, PdMMRT, colorectal cancer, ovarian cancer, non-small cell lung cancer, cervical cancer, rectal cancer, clear cell sarcoma and head-and-neck squamous cell carcinoma.

We anticipate receiving additional milestones from GSK, of equal magnitude to the milestone payments outlined above, upon approval of the BLA and acceptance and approval of the EMA filings of dostarlimab for the PdMMRT indication.

Depending upon the timing of the aforementioned dostarlimab regulatory acceptance and approval milestones, we anticipate a total of $75.0 million in such milestone payments over the upcoming 18 months.

An additional $165.0 million in sales milestones is anticipated upon achievement of certain dostarlimab annual sales revenues.

In October 2020, we amended our GSK collaboration to increase royalties on global net sales of dostarlimab to 8-25%, add 1% royalty rate on GSK’s global net sales of Zejula and received a one-time cash payment of $60.0 million.

For more information about these collaborations, see “— Collaborations”.

We endeavor to operate with capital efficiency and anticipate that our current cash and existing collaborations will provide cash runway at least into 2023.

We anticipate our net cash usage in 2020 (after receipt of anticipated collaboration revenues) to be approximately $60.0 million.

Our Product Candidates

The following table summarizes certain key information about our wholly-owned and partnered product candidates:

The outbreak of the novel coronavirus and the COVID-19 disease that continues to be a global pandemic.

The full impact of the COVID-19 pandemic is inherently uncertain at the time of this Annual Report.

The COVID-19 pandemic has resulted in travel restrictions and, in some cases, prohibitions of non-essential activities, disruption and shutdown of businesses, and greater uncertainty in global financial markets.

As COVID-19 has spread, it has significantly impacted the health and economic environment around the world, and many governments have closed most public establishments, including restaurants, workplaces and schools.

Our ongoing clinical trials have been, and may continue to be, affected by the closure of offices, or country borders, among other measures being put in place around the world.

The inability to travel and conduct face-to-face meetings can also make it more difficult to enroll new patients in ongoing or planned clinical trials.

Any of these circumstances will potentially have a negative impact on our financial results and the timing of our clinical trials.

The COVID-19 pandemic has caused us to modify our business practices (including but not limited to curtailing or modifying employee travel, moving to full remote work, and cancelling physical participation in meetings, events and conferences), and we may take further actions as may be required by government authorities or that we determine are in the best interests of our employees, patients and business partners.

The extent of the impact of the COVID-19 pandemic on our future liquidity and operational performance will depend on certain developments, including the duration and spread of the outbreak, the availability and effectiveness of vaccines, the impact on our clinical trials, patients and collaboration partners, and the effect on our suppliers.

We are a leading antibody development company with a pipeline of novel therapeutic antibodies, which is being further expanded by applying our technology platform to emerging biological targets.

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We are working to demonstrate the safety and efficacy of our wholly-owned pipeline programs.

We are currently developing four wholly-owned programs to key 2020 milestones, including our Phase 2 chronic rhinosinusitis with nasal polyps ECLIPSE trial with etokimab in the first half of 2020, additional data from our Phase 2 ANB019 trials in GPP during 2020 and PPP during the second half of 2020, initiation of a Phase 1 trial of ANB030 in the first half of 2020 and filing of an IND for ANB032 in the second half of 2020.

We are currently developing three wholly-owned programs to key 2021 milestones, including data from our Phase 2 imsidolimab clinical trial in PPP during the first quarter of 2021, initiation of a Phase 3 clinical trial in GPP during mid-2021, data from our Phase 2 imsidolimab clinical trial in EGFRi/MEKi during the fourth quarter of 2021, top-line data from our Phase 1 clinical trial of ANB030 in mid-2021 and initiation of Phase 2 clinical trials in alopecia areata and vitiligo during the second half of 2021 and initiation of a healthy volunteer Phase 1 trial for ANB032 in the first half of 2021.

• Continuing to expand our proprietary pipeline by generating new product candidates using our technology platform.

Using our proprietary SHM antibody generation platform, we are able to rapidly develop novel antibodies

against biological targets.

Using our proprietary SHM antibody generation platform, we are able to rapidly develop novel antibodies against biological targets.

Our goal is to continue expanding our wholly-owned new therapeutic antibody program pipeline by innovating additional wholly-owned novel pipeline antibodies to potentially first-in-class immune-related targets.

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Our Wholly-Owned Product Pipeline

Our most advanced, wholly-owned pipeline programs, etokimab, ANB019, ANB030 and ANB032, are described below:

Anti-IL-33 Antibody

Etokimab is a potentially first-in-class antibody that inhibits the activity of IL-33 and is being developed to treat respiratory disorders.

We are conducting a Phase 2 clinical trial of etokimab in patients with CRSwNP.

We have completed a Phase 2a clinical trial of etokimab in severe eosinophilic asthma, and have elected to delay initiation of further clinical development in this indication until data are available from our ongoing CRSwNP trial.

We have previously completed a Phase 2a trial in severe peanut allergy patients and a Phase 2a and Phase 2b clinical trial of etokimab in moderate-to-severe atopic dermatitis and have subsequently decided to discontinue further clinical development in those indications.

IL-33 Target Biology

IL-33 is a pro-inflammatory cytokine that signals through the ST2 receptor, which multiple studies suggest serves as a central mediator of various immune responses leading to Th2-type inflammatory disorders, including asthma, CRSwNP and other atopic diseases.

In response to pathogens, viruses, toxins or allergens, IL-33 is rapidly released from mucosal epithelial and endothelial cells.

For example, a scientific study has indicated that individuals with asthma symptoms express higher levels of IL-33 than healthy control subjects.

IL-33 initiates a diverse array of cellular immune responses, including the activation of mast cells, basophils and eosinophils, leading to production of downstream cytokines, such as IL-4, IL-5 and IL-13, which are associated with atopic diseases.

IL-33 also acts on T helper 2, or Th2, effector cells and Innate Lymphoid Cell Type 2, or ILC2, two types of white blood cells that initiate and orchestrate atopic responses.

Because etokimab inhibits IL-33 function and acts upstream of key cell types involved in atopy and the subsequent release of Th2 cytokines, we believe that its mechanism has advantages over that of competing therapeutic antibodies which block only a subset of IL-4, IL-5 or IL-13 cytokines.

Genetic studies support the importance of the IL-33 pathway in respiratory diseases.

These studies have demonstrated that certain ST2 mutations reduce IL-33 mediated signaling and thereby protect individuals with mutated ST2 from asthma.

Certain studies also demonstrate that mutation that increases IL-33 mediated signaling increases incidence of asthma.

This supports the hypothesis that an anti-IL-33 antibody, such as etokimab, has the potential to benefit respiratory diseases, including asthma and CRSwNP patients.

We believe that targeting IL-33 activity is a more promising therapeutic intervention strategy than targeting its receptor, ST2, because (i) ST2 is present in significantly larger quantities, in comparison to IL-33, which will likely require high anti-ST2 antibody dosing levels, (ii) anti-ST2 antibodies are likely to be internalized in vivo , which will likely require frequent dosing and (iii) soluble ST2 inhibits IL-33 function, therefore blocking ST2, and likely leading to the release of additional IL-33, thereby exacerbating atopic disease.

Etokimab Description

Etokimab, which is a potential first-in-class therapeutic antibody, is our wholly-owned anti-IL-33 antibody product candidate generated using our SHM technology platform.

The potency and functional activity of etokimab for human and cynomolgus monkey IL-33 was measured using standard in vitro assays:

equilibrium dissociation constant, or KD, and half-maximal inhibitory concentration values, or IC50.

Etokimab demonstrated highly potent KD values of approximately 1 pM and 37 pM for human and cynomolgus monkey IL-33, respectively.

Etokimab inhibits secretion of IL-5 from primary basophils purified from peripheral blood of healthy human subjects with an IC50 of approximately 1.5 nM, which is approximately 15-fold greater than that of the soluble ST2 antagonist.

Lower KD and IC50 values indicate higher potency and functional activity, respectively.

Using peripheral blood mononuclear cells, or PBMC, etokimab inhibited human and cynomolgus monkey interferon-gamma release with an IC50 of approximately 1.1 nM and approximately 20.4 nM, respectively.

We have developed a whole blood version of the PBMC assay, which we used in our Phase 1 trial to understand the pharmacodynamic activity of etokimab in clinical trials.

Our preclinical development has also demonstrated that etokimab has favorable manufacturability, pharmacokinetics and toxicology to support development.

Studies have demonstrated desirable manufacturing properties for etokimab, including robust expression from Chinese hamster ovary cells, or CHO cells, efficient purification using standard downstream techniques and stable formulation up to concentrations required for subcutaneous dosing in humans.

Etokimab demonstrated a half-life of approximately seven days in cynomolgus monkeys, retained full functional activity when incubated in normal human serum at 37 °C for one week and proved to be fully active in cynomolgus monkey sera two weeks after dosing.

We have conducted preclinical toxicology studies under good laboratory practices, or GLPs, for etokimab.

In addition, we have conducted manufacturing under good manufacturing practice to produce etokimab in quantities for clinical use.

Clinical Development Plan

We have completed a Phase 1 trial of etokimab in healthy volunteers in Australia under an approved Clinical Trial Notification, or CTN.

Our Phase 1 trial assessed, in single ascending doses, or SAD, and multiple ascending doses, or MAD, safety, tolerability and pharmacokinetic characteristics of etokimab.

The SAD cohorts of this Phase 1 trial have been completed and, subsequent to review of the clinical data generated under the SAD, the Australian regulatory authority approved the initiation of MAD cohorts, which have also been completed.

In the double-blind, placebo-controlled Phase 1 trial, 96 healthy volunteer subjects were dosed with either a single subcutaneous or intravenous dose of etokimab ranging between 10 mg and 750 mg, or four multiple doses of etokimab ranging between 40 mg and 300 mg over a period of four consecutive weeks.

In the SAD portion of our Phase 1 clinical trial of etokimab, 51 subjects (80%) experienced at least one treatment-emergent adverse events, or AE, however the occurrence of AEs was similar between etokimab (38 of 48;

79%) versus placebo (13 of 16, 81%) dosed individuals, and the most common AEs were upper respiratory tract infection (etokimab 48% vs.

placebo 50%) and headache (etokimab 27% vs.

placebo 31%).

The only serious adverse event reported in the SAD portion of the trial was severe neutropenia 22 days post single dose of intravenous 750 mg etokimab in a single subject.

Neutrophil levels in this subject returned to normal by 29 days post-dose and this event was preceded by prodromal viral symptoms consistent with an on-going viral infection.

In the MAD portion of the Phase 1 clinical trial of etokimab, 24 subjects (75%) experienced an AE, however there was no difference in the percentage of AEs observed amongst subjects dosed with etokimab (18 of 24, 75%) versus placebo (6 of 8, 75%), and the most common AEs were upper respiratory tract infections (etokimab 21% versus placebo 38%) and headache (etokimab 33% versus placebo 38%).

No severe adverse events were reported in the MAD portion of the clinical trial.

None of these adverse events were determined to be drug-related and no dose-limiting toxicities were observed at any dose level.

We concurrently evaluated the pharmacodynamics of etokimab in the SAD portion of the Phase 1 study using a whole blood ex vivo assay upon stimulation with IL-33/IL-12, where etokimab inhibition of IFN-gamma release was measured.

Persistent and nearly complete inhibition was observed at 1032 hours (day 43) post-dosing for all SAD cohorts dosed with 40 mg etokimab or greater, regardless of whether such dose was through a subcutaneous or intravenous route of administration.

In the 300 mg and 750 mg IV dosed cohorts of the SAD portion of the study, the pharmacodynamic assay was also performed at 2040 hours (day 85) post-dosing, and nearly complete IFN-gamma inhibition was observed through this time point.

Pharmacokinetic testing indicated that the terminal half-life of etokimab among the SAD cohorts was approximately 372 hours (15–16 days) with comparable values across all doses and regardless of intravenous or subcutaneous route of administration.

Anti-drug antibodies were detected at only low titer levels, and were observed in 5 of 48 etokimab dosed subjects in the SAD cohorts and 2 of 24 etokimab dosed subjects in the MAD cohorts, and no effect was observed on pharmacokinetic parameters in any of the subjects with anti-drug antibody titers.

There were no adverse events that were determined to be drug-related, and no dose-limiting toxicities were observed at any dose level.

We have concurrently utilized a whole blood ex vivo assay to evaluate pharmacodynamics, and we believe the results of this assay suggest that the pharmacodynamic activity of etokimab

can, at certain dose levels, extend to three months subsequent to a single administration.

We disclosed detailed data from this Phase 1 trial at the AAD and AAAAI conferences in early March 2017.

We are conducting, under an IND to the FDA, a randomized, placebo-controlled Phase 2 trial of etokimab in approximately 100 adult patients with CRSwNP which is a debilitating atopic disorder associated with elevated IL-33 pathway signaling.

Patients in this trial, also known as the ECLIPSE trial, will be randomized between three subcutaneous dosing cohorts, each in combination with mometasone furoate nasal spray as background therapy, as follows:

(i) initial 300mg loading dose followed by 150mg monthly doses of etokimab, (ii) initial 300mg loading dose followed by 150mg doses of etokimab every eight weeks, and (iii) monthly doses of placebo.

Efficacy will be assessed at week 8 and week 16 post-dosing, with an eight week monitoring period, using the bilateral endoscope Nasal Polyp Score and Sino-Nasal Outcome Test, and we anticipate interim (week 8) analysis top-line data from this trial to be available in the first half of 2020.

In June 2019, we announced positive proof-of-concept data from our Phase 2a trial of etokimab in severe adult eosinophilic asthma patients.

This Phase 2a proof-of-concept trial, conducted under a CTA with the MHRA in the United Kingdom and under an IND, with the U.S.

Food and Drug Administration, or FDA, enrolled 25 adult severe eosinophilic asthma patients, who were randomized between a single 300mg intravenous dose of etokimab or placebo upon enrollment (Day 1) at six sites located in the United States and the United Kingdom.

Upon screening, which occurred seven to 14 days prior to enrollment, patients were required to have a blood eosinophil count of at least 300 per microliter, confirmed clinical diagnosis of severe asthma according to the Global Initiative for Asthma (GINA) 2016, pre-bronchodilator FEV1 of less than 80 percent of predicted and at least one asthma exacerbation within the past 12 months requiring use of rescue medication.

Patients were required to be stably maintained on high-dose inhaled corticosteroids (ICS) and long-acting beta-2-agonists (LABA) for at least three months prior to screening and were required to continue ICS/LABA therapy during the course of this trial.

Patients were permitted to utilize rescue therapy when medically necessary, including in the management of asthma exacerbations.

Baseline clinical assessments were conducted for each patient on Day 1 prior to etokimab or placebo dose, and patients completed follow-up clinical assessments on Days 2, 8, 22, 36, 64, 85, 106 and 127.

Patients in the etokimab arm rapidly improved their Forced Exhaled Volume In One Second (FEV1), which is a measure of lung function, with an eight percent FEV1 improvement over placebo at Day 2, which was sustained through Day 64 with an 11 percent increase over placebo.

Asthma Control Questionnaire 5 (ACQ-5) scores, which comprise patient-reported outcomes associated with asthma symptoms, decreased in the etokimab arm by 0.52 over placebo at Day 8 and were sustained to 0.54 over placebo at Day 64, and the etokimab arm achieved the minimal clinically important difference (MCID) of 0.5 below baseline.

Blood eosinophil level reduction, which is a biomarker of etokimab’s mechanism, demonstrated 31 percent and 46 percent reductions in the etokimab arm over placebo at Days 2 and 64, respectively.

Etokimab was generally well tolerated in all patients and no serious adverse events were reported.

Each of the aforementioned clinical trials are subject to regulatory review by the respective regulatory authority applicable to the jurisdiction of the trial.

We have also conducted a Phase 2a trial in severe peanut allergy patients and Phase 2a and Phase 2b trials of etokimab in moderate-to-severe adult atopic dermatitis patients, and have subsequently decided to discontinue further clinical development in those indications.

As described in the section titled “Risk Factors” and elsewhere in this report, the clinical development of drug product candidates is subject to a wide range of risks and uncertainties, any of which could cause our actual development strategy or timeframes to vary.

Etokimab Market Opportunity

A significant portion of individuals in the U.S.

population experience at least one atopic disease during their lifetime, and it is well understood that most patients with one type of atopic condition tend to present with other allergic conditions.

While we believe etokimab may be effective across multiple atopic diseases, we have prioritized our development efforts based on unmet medical need and potential market opportunity.

We have chosen to focus our etokimab program initially on respiratory indications, including asthma and CRSwNP.

We estimate, based on our analysis of publicly available data sources and interviews with physicians and key opinion leaders in the field, that asthma affects approximately 7.7% of the adult U.S.

population, or 19.0 million individuals, of which 1.1 million individuals have severe disease that cannot be controlled by standard-of-care therapy, of which 50% are believed to be eosinophilic patients.

As a chronic inflammatory disorder, severe asthma can lead to permanent structural damage to the airways and long-term reductions in lung function.

Although many mild-to-moderate asthmatics respond well to currently available treatments, which include inhaled corticosteroids, or ICS, and long-acting beta agonists, or LABA, severe asthma in patients is generally not adequately controlled by such available therapies.

We believe that etokimab may have therapeutic benefit across a broad range of ICS-refractory severe adult eosinophilic asthma patients, and plan to differentiate etokimab’s therapeutic efficacy, dosing frequency and safety relative to competitors.

Chronic Rhinosinusitis with Nasal Polyps.

We estimate that CRSwNP, based on our analysis of publicly available data sources and interviews with physicians and key opinion leaders in the field, affects approximately 1.3 million adults in the United States and we estimate that 400,000 of these patients are inadequately controlled with standard-of-care.

CRSwNP is a debilitating chronic atopic condition associated with elevated IL-33 expression.

Patients with CRSwNP that do not respond to standard-of-care are likely to undergo recurring surgeries to remove nasal polyps that block airflow through the nasal passages and often lead to recurring infections and related discomfort.

Our most advanced, wholly-owned pipeline programs, imsidolimab, ANB030 and ANB032, are described below:

Anti-IL-36R Antibody

ANB019 is an antibody that inhibits the function of IL-36R, which we are initially developing as a potential first-in-class therapy for GPP and PPP patients.

GPP is a life-threatening, rare systemic inflammatory disorder reported to affect approximately 3,000 patients in the United States alone, with no currently approved therapies.

Imsidolimab is an antibody that inhibits the function of IL-36R, which we are initially developing as a potential first-in-class therapy for multiple inflammation-mediated dermatological patient populations.

GPP is a life-threatening, rare systemic inflammatory disorder reported by literature to affect at least 3,000 patients while recent medical claims analysis indicates at least 10,000 patients in the United States alone, with no currently approved therapies.

Studies have shown that GPP can be associated with mutations in the gene encoding the IL-36R antagonist, or IL-36RA, or can be caused by excessive IL-36 cytokine levels, that lead to abnormally high signaling through the IL-36R and thereby cause the systemic inflammatory condition, GPP.

We also plan to develop ANB019 for other IL-36R driven inflammatory conditions, including PPP, which is reported to affect approximately 150,000 patients in the United States.

We plan to seek FDA Orphan Drug Designation for ANB019 for the treatment of GPP and PPP, which we believe may be differentiated from the non-rare plaque psoriasis, or psoriasis vulgaris, based upon distinctive genetic and translational features unique to GPP and/or PPP.

We are currently conducting two Phase 2 clinical trials with ANB019 in GPP and PPP.

We are also developing imsidolimab for PPP which is reported to affect approximately 150,000 patients, EGFRi/MEKi-mediated skin toxicity which is estimated to affect 60,000 patients, certain IL-36 mediated ichthyosis subtypes that affect 6,000 patients, hidradenitis suppurativa affecting 150,000 patients and moderate-to-severe acne which affects 7 million patients, all in the United States.

We have obtained FDA Orphan Drug Designation for imsidolimab for the treatment of GPP, and plan to seek Orphan Drug Designation for additional indications in the future.

We anticipate initiating a Phase 3 clinical trial in GPP starting mid-2021, reporting top-line data from the POPLAR Phase 2 clinical trial of PPP in the first quarter of 2021, reporting interim top-line data from the EMERGE Phase 2 trial in EGFRi/MEKi mediated skin toxicity by the end of 2021, reporting top-line data from the INSPIRE Phase 2 clinical trial in ichthyosis in 2022, and initiating the HARP Phase 2 clinical trial in hidradenitis suppurativa and the ACORN Phase 2 clinical trial in moderate-to-severe acne in the second quarter of 2021.

IL-36R Target Biology

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In addition, studies have demonstrated that humans with genetic mutations that downregulate IL-36 receptor activity are otherwise normal with no specific clinical phenotype.

We believe that ANB019 has the potential to be the first-in-class therapeutic antibody targeting IL-36R, serving as a therapeutic opportunity for patients with IL-36 signaling mediated inflammatory disease, including GPP and PPP.

ANB019 Description

ANB019 was generated using our SHM technology platform and has demonstrated high functional potency in blocking human and cynomolgus monkey IL-36 signaling in preclinical studies.

ANB019 blocks signal transduction through the human IL-36R and cynomolgus monkey IL-36R by inhibiting the interaction between the receptor and IL-36 alpha, IL-36 beta, and IL-36 gamma cytokines.

The high potency and functional activity of ANB019 for human and cynomolgus monkey IL-36R was measured using standard in vitro assays to determine KD and IC50 values.

ANB019 has demonstrated potent KD values of approximately of 71 pM and 209 pM for human IL-36R and cynomolgus monkey IL-36R, respectively.

The antibody exhibits high specificity for IL-36R, displaying no detectable binding

to related proteins.

Functional potency of ANB019 is at least 100-fold greater than IL-36RA in human systems, which is measured as the IC50 of inhibition of interleukin-8, or IL-8, release from human keratinocytes.

ANB019 functional activity has been demonstrated through inhibition of IL-8 secretion from human primary keratinocytes when stimulated by IL-36 gamma of approximately 0.15 nM and 1.2 nM, respectively.

We believe that imsidolimab has the potential to be the first-in-class therapeutic antibody targeting IL-36R, serving as a therapeutic opportunity for patients with IL-36 signaling mediated inflammatory diseases.

Translational studies have indicated that IL-36 signaling is upregulated in GPP, PPP, EGFRi/MEKi-mediated skin toxicity, ichthyosis, hidradenitis suppurativa and acne.

Imsidolimab Non-Clinical Development

Imsidolimab was generated using our SHM technology platform and has demonstrated high functional potency in blocking human and cynomolgus monkey IL-36 signaling in preclinical studies.

Imsidolimab blocks signal transduction through the human IL-36R and cynomolgus monkey IL-36R by inhibiting the interaction between the receptor and IL-36 alpha, IL-36 beta, and IL-36 gamma cytokines.

The high potency and functional activity of imsidolimab for human and cynomolgus monkey IL-36R was measured using standard in vitro assays to determine equilibrium dissociation constant, or KD, and half-maximal inhibitory concentration values, or IC50.

Imsidolimab has demonstrated potent KD values of approximately of 71 pM and 209 pM for human IL-36R and cynomolgus monkey IL-36R, respectively.

The antibody exhibits high specificity for IL-36R, displaying no detectable binding to related proteins.

Functional potency of imsidolimab is at least 100-fold greater than IL-36RA in human systems, which is measured as the IC50 of inhibition of interleukin-8, or IL-8, release from human keratinocytes.

Imsidolimab functional activity has been demonstrated through inhibition of IL-8 secretion from human primary keratinocytes when stimulated by IL-36 gamma of approximately 0.15 nM and 1.2 nM, respectively.

Lower KD and IC50 values indicate higher potency and functional activity, respectively.

Similar IC50 values were observed in those same preclinical studies when keratinocytes were stimulated with IL-36 alpha or beta.

To date, we have demonstrated that the half-life of ANB019 in cynomolgus monkeys is more than nine days.

ANB019 is well-expressed from CHO mammalian cells and is readily purified using standard methodologies.

To date, we have demonstrated that the half-life of imsidolimab in cynomolgus monkeys is more than nine days.

Imsidolimab is well-expressed from Chinese hamster ovary cells, or CHO cells, and is readily purified using standard methodologies.

In addition, the antibody retained full functional activity when incubated in normal human serum at 37 °C for one week.

Clinical Development Plan

We have completed, under an approved CTN, a Phase 1 clinical trial in healthy volunteers for which we announced positive top-line results from an interim analysis of this trial and subsequently presented completed data from this trial at EAACI 2018.

In the double-blinded, placebo-controlled healthy volunteer Phase 1 trial, 36 subjects were administered a single subcutaneous or intravenous dose of ANB019 ranging between 10 mg and 750 mg, 18 subjects were administered multiple ascending doses of ANB019 intravenously ranging between 40 mg and 300 mg weekly for four consecutive weeks and 18 subjects were dosed with placebo.

ANB019 was well-tolerated by all subjects and no dose-limiting toxicities were observed.

The most frequent treatment-emergent adverse events observed in the single ascending dose cohorts were upper respiratory tract infections in 10 of 36 (28%) subjects dosed with ANB019 versus six of 12 (50%) subjects dosed with placebo, and headache in 10 of 36 (28%) subjects dosed with ANB019 versus three of 12 (25%) subjects dosed with placebo.

In the multiple ascending dose cohorts, the most frequent treatment-emerging adverse events observed were headache in seven of 18 (39%) subjects dosed with ANB019 versus one of six (17%) subjects dosed with placebo.

No serious adverse events were reported among any subjects in the trial.

The in vivo half-life of ANB019 was approximately 28 days for both subcutaneous and intravenous routes of administration, with bioavailability of approximately 90 percent.

A single dose of ANB019 at certain dose levels was able to completely suppress IL-36 cytokine function for 85 days, as measured by IL-36 cytokine-mediated release of IL-8 using an ex vivo pharmacodynamic assay.

The favorable pharmacokinetics and pharmacodynamic properties of ANB019 and other results demonstrated by this Phase 1 trial support advancement of ANB019 into Phase 2 studies for GPP and PPP.

We received clearance of a CTA filing to the MHRA and an IND filing with the FDA, and have initiated a 10-patient open-label, multi-dose, single-arm Phase 2 trial of ANB019 in GPP patients, also referred to as the GALLOP trial, where an interim analysis, announced in September 2019, was conducted after the first two patients completed 16-weeks (Day 113) with ANB019 monotherapy.

Both patients achieved the primary endpoint of disease improvement at Day 29 and Day 113 without requiring rescue therapy.

Patients demonstrated rapid and sustained modified Japanese Dermatology Association (mJDA) improvement and complete clearance of skin pustules from Day 8 through Day 113.

C-reactive protein, or CRP, levels decreased to nearly normal in both patients, and genotypic testing of these two patients indicated that ANB019 may be broadly applicable to pustular disease patients without a requirement for genetic screening.

Enrollment is ongoing in GALLOP, and we anticipate additional clinical data and a regulatory strategy update for the development of ANB019 in GPP during 2020.

ANB019 Market Opportunity

IL-36R cytokine dysfunction is implicated in multiple inflammatory disorders including GPP and PPP.

Generalized Pustular Psoriasis.

We have completed, under an approved Clinical Trial Notification, or CTN, a Phase 1 clinical trial in healthy volunteers for which we announced positive top-line results from an interim analysis of this clinical trial and subsequently presented completed data from this clinical trial at the 2018 European Academy of Allergy and Clinical Immunology Congress.

In the double-blinded, placebo-controlled healthy volunteer Phase 1 clinical trial, 36 subjects were administered a single subcutaneous or intravenous dose of imsidolimab ranging between 10 mg and 750 mg, 18 subjects were administered multiple ascending doses of imsidolimab intravenously ranging between 40 mg and 300 mg weekly for four consecutive weeks and 18 subjects were dosed with placebo.

Imsidolimab was well-tolerated by all subjects, and no dose-limiting toxicities were observed.

The most frequent treatment-emergent adverse events observed in the single ascending dose cohorts were upper respiratory tract infections in 10 of 36 (28%) subjects dosed with imsidolimab versus six of 12 (50%) subjects dosed with placebo and headache in 10 of 36 (28%) subjects dosed with imsidolimab versus three of 12 (25%) subjects dosed with placebo.

In the multiple ascending dose cohorts, the most frequent treatment-emerging adverse events observed were headache in seven of 18 (39%) subjects dosed with imsidolimab versus one of six (17%) subjects dosed with placebo.

No serious adverse events were reported among any subjects in the clinical trial.

The in vivo half-life of imsidolimab was approximately 28 days for both subcutaneous and intravenous routes of administration, with bioavailability of approximately 90 percent.

A single dose of imsidolimab at certain dose levels was able to completely suppress IL-36 cytokine function for 85 days, as measured by IL-36 cytokine-mediated release of IL-8 using an ex vivo pharmacodynamic assay.

The favorable pharmacokinetics and pharmacodynamic

properties of imsidolimab and other results demonstrated by this Phase 1 clinical trial supported advancement of imsidolimab into Phase 2 studies.