AbCellera at KeyBanc Forum: Strategic Moves in Antibody Discovery

On Wednesday, 19 March 2025, AbCellera Biologics (NASDAQ: ABCL) took center stage at the KeyBanc Annual Health Care Forum. The company outlined its strategic roadmap, emphasizing both its strengths in antibody discovery and the challenges of transitioning into drug development. With a focus on innovation, AbCellera is poised to leverage its unique capabilities to advance its pipeline and forge strategic partnerships.

Key Takeaways

• AbCellera is advancing its internal programs, ABCL-575 and ABCL-635, with a focus on autoimmune diseases.
• The company has partnered with AbbVie to enhance its T cell engager platform.
• A new manufacturing facility is set to begin operations by the end of 2025, offering strategic flexibility.
• AbCellera aims to expand its co-development partnerships, utilizing its antibody discovery expertise.
• The company estimates a $2 billion market opportunity for its program ABCL-635 in the U.S.

Financial Results

• The investment in manufacturing capabilities was substantial, with about half funded by Canadian and British Columbian governments.
• Even with limited throughput, the facility is expected to break even compared to using contract development and manufacturing organizations (CDMOs).

Operational Updates

• ABCL-575: Originally a co-development with EQRx, now fully led by AbCellera after EQRx’s acquisition by Revolution Medicines.
• ABCL-635: Clinical Trial Application (CTA) filing is anticipated next quarter, with patient dosing expected shortly thereafter. Results are projected for the first half of 2026.
• Manufacturing Facility: The building is complete, with equipment arriving and operational readiness expected by year-end.

Future Outlook

• Internal Programs: AbCellera plans to advance select programs, either independently or with partners offering complementary expertise.
• Manufacturing Facility: Expected to provide valuable insights and quick transition capabilities from production to clinical trials.
• TCE Platform: The company seeks to collaborate with significant players in developing T cell engagers, fueling numerous future programs.

Q&A Highlights

• Martin Hogan expressed excitement about both ABCL-575 and ABCL-635, with a focus on the latter’s strategic alignment and anticipated quick trial phases.
• The portfolio of 20 discovery programs offers attractive economics through downstream stakes in partners’ successes.

In conclusion, for a detailed understanding of AbCellera’s strategic plans, readers are encouraged to refer to the full transcript below.

Full transcript - KeyBanc Annual Health Care Forum:

Scott Schoenhouse, Healthcare Technology Analyst, KeyBank: Welcome everybody. My name is Scott Schoenhouse. I’m the Healthcare Technology Analyst at KeyBank. I have the pleasure to have Martin Hogan, Director of strategic finance and investor relations. Martin, you wear many hats.

Thank you for joining us here today for our fireside chat. I guess let’s kick off, maybe, introduce yourself, Martin, your role at the company, and a little bit about Apsara, for anyone that’s new to your story that’s on, that’s on the Aspire side.

Martin Hogan, Director of Strategic Finance and Investor Relations, AbCellera: Absolutely. Scott, thanks for thanks for hosting us today. I really appreciate the chance to have this conversation with you today. I’m Martin Hogan. Like I said, I lead strategic finance and investor relations, so responsible for our long term planning, supporting, you know, strategic decisions in in a number of areas of the business and also have the pleasure of connecting with our investors.

I’ve been with the company for about five years with a, you know, with a background in life sciences and other industries, strategy, corporate finance. Maybe before we launch into sort of a high level perspective on Absellera, I’ll be making some forward looking statements. You know, they’re they’re subject to the usual caveats, and I direct you to our SEC filings for a full list of risks involved with investing in AbCellara. AbCellara really is, you know, in a in a unique position. We spent the past over twelve years building a company focused on therapeutic antibody discovery and development, you know, like build and exercise that capability in well over a hundred drug discovery programs, initially many, four partners and then increasingly in co development and lately with a strong focus on internal programs.

What makes, you know, what makes that effort unique is really that we have integrated from the very front end of drug discovery now all the way through manufacturing to come online at the end of this year and then starting this year into clinical trials on a very broad basis and in an entirely therapeutic area agnostic fashion. The ability to find antibodies against the very most difficult targets, complex membrane protein targets, ion channels, GPCRs, and, you know, really to have demonstrated that ability with some internal programs, but also for some of the world’s, you know, largest, best known, most sophisticated drug developers, the likes of Lilly, Regeneron, Novartis to to just name a few. And so we’re now finding ourselves in a position where, having built that capability, having put it to excellent use, with partners on, you know, almost a hundred programs, where we have downstream participation in the ultimate success of the molecule. We have in parallel advanced our best ideas in an internal pipeline, and that is increasingly moving into the spotlight with our first two, IND equivalent filings here in Canada, CTAs, coming up this quarter or next next quarter, I should say.

We’re not not quite past March 31 yet.

Scott Schoenhouse, Healthcare Technology Analyst, KeyBank: Great. So I I’ll steer the conversation with some buyers side chat, but in, the investors, if you want, you can post your questions through the portal here, and I’ll be able to see them on my end and read them to Martin. So feel free to, post questions, on the board. But Martin, I guess, you provided your fourth Q update a couple of weeks ago. You made on track to file, CTAs, which for our American investors are IND equivalents in Canada.

You have two internal programs, the ABCL five seventy five and ABCL six thirty five that you are, sorry, you’re on track to file for second quarter, right? Maybe let’s talk about five seventy five. It has the potential to be the best in class drug, agnostic dermatitis. What’s the competitive landscape of the molecules in this area, ox forty ligand? And how are you and how are you differentiated here?

Martin Hogan, Director of Strategic Finance and Investor Relations, AbCellera: Yep. That’s a great question. So, let’s start with five seventy five. I’ll I’ll say at the at the start that we’re, you know, probably even more excited, about the the other program going into the clinic, six thirty five, but we are excited about five seventy five. Five seventy five is a bit atypical in the way that it ended up in our pipeline.

Normally, we choose programs in our pipeline that have a, you know, very clear potential for differentiation against other treatments for an indication. In this case, we are, you know, one of several drugs targeting the AUX 40, AUX 40 ligand pathway that is implicated in a wide range of autoimmune conditions, atopic dermatitis certainly being, you know, being a large one. And the the program came to us originally as a co development effort with EQRx. And once EQRx was acquired by Revolution Medicines, the program effectively reverted to us, and we’re now leading the development ourselves. EQRx had a strategy to pursue, fast follower molecules with a particular commercial model, which is, you know, not what we usually do.

But this molecule and this idea is really promising just because the opportunity is so large and the molecule that we discovered, is so attractive. Being a fast follower, you might, you know, ask who is it following? It’s it’s really following Sanofi’s amlutilumab, which in atopic dermatitis is now in, phase three trials and in phase two trials across a wide range of other autoimmune conditions. And, you know, we believe the mechanism of targeting the AUX40, AUX40 ligand pathway has potential to really make a difference to patients suffering from those conditions, including and, you know, maybe particularly those, who are not showing sufficient response on, IL four, IL thirteen targeting drugs like, Dupixent, for example. So, it’s a, you know, it’s a large opportunity, you know, overall, in atopic dermatitis alone, certainly across across the other indications.

There are other players, amlutilumab most most notably. You know, when you look across the landscape, there are also AUX40 targeting drugs, the other end, if you will, of, you know, of that, of that pathway. And I think in the in the, aux 40 ligand targeting space, I think the other notable one, that just had an interim phase one readout is Apogee’s nine nine zero. So it’s a busy space, but with, presumably room for, you know, for many successful drugs alone, potentially, and also potentially in, in combination. Right?

It’s it’s quite conceivable that, targeting, you know, targeting the, the disease mechanism, you know, in multiple ways, including, through the OX40, OX40 ligand pathway may be the may be the best way forward, and we’re certainly well positioned to do that. In terms of differentiation, there are really two things that stand out about, AMCELLARA five seventy five. The one is it has truly excellent biophysical properties. So in terms of manufacturability, administration, you know, all those things are looking very promising. And the second is, it has really good, you know, in, you know, in in preclinical studies demonstrated PD, PK, and half life, which may translate into a longer, less frequent dosing schedule than amlutelumab, although that ultimately will be proven out in the clinic.

Scott Schoenhouse, Healthcare Technology Analyst, KeyBank: That’s super helpful, Martin. Let me move to, ABCL six thirty five. Let’s talk about the therapeutic area. Let’s talk about the total addressable market, maybe when you plan to disclose the exact target and report phase one clinical readouts.

Martin Hogan, Director of Strategic Finance and Investor Relations, AbCellera: Yeah. Great question. So six thirty five, maybe let me start by saying, you know, how do we think about internal programs and frankly, co development programs too? Really, we’re looking at four criteria. Right?

The first one is, is the signs clear and promising? So, you know, if we can find an antibody that hits our target in the right way, is there a high likelihood that it is going to have a meaningfully positive impact on, you know, the the indication that we’re targeting. The second question is, do we have the potential here to actually differentiate from existing and upcoming treatments for that disease? And then, of course, the question of is this a large, is this a large, you know, unmet medical need and translating into a large commercial opportunity? And finally, what is the development path?

So can we reasonably quickly without putting too much capital, or capacity really at risk, demonstrate that we have, you know, to ourselves and to potential partners that we have a drug candidate that could become, a meaningful drug in the marketplace. And in the case of six three five, we really have a we really have a drug candidate that is, that is hitting, you know, well on all four criteria, right, where the, the science is very clear. We know, you know, we there’s a the target is although we can’t be, you know, specific on it yet, and we’ll talk about that in a second. The target is a complex membrane protein, so an ion channel or a GPCR, and it has been successfully targeted with small molecules. And those small molecules, by engaging the target, have demonstrated clear clinical benefit.

So we know, that the science is going to work. The second question here is, is this a significant unmet opportunity? We believe it is. We estimate that the total addressable market is you know, $2,000,000,000 or more in annual sales in The United States alone. And we do believe that we’ve got a clear path to differentiation.

This program is much more on strategy in that it would be the first ever biologic to, to hit this target. The only other competition out there at the moment is in the form of small molecules, and those small molecules, you know, as many small molecules do have, you know, undesirable side effects for one and require, you know, and require effectively daily daily taking of a pill, whereas, our treatment being an antibody, you know, is expected not to have any of the, not to have any of the side effects. We’re expecting a very clean safety profile and, would presumably come in the form of a once monthly injection, which, you know, which we understand many patients would prefer. You know, and I think finally, what is so exciting about this program is that there are clear markers, that we, you know, expect to be able to see in our phase one trial, where, you know, where a reasonably quick phase one trial should tell us not just, that the drug is safe, if indeed it is, but also, should give us a clear indication on whether, it is on track to be efficacious. Right.

So overall, you know, really, really exciting program, fully on strategy for us. You mentioned the CTA filing, next quarter, in the second quarter. It’s a reasonably quick trial, so we’re hoping to, you know, dose patients not long, not long after the filing and expect to be able to read out in the first half of twenty twenty six already.

Scott Schoenhouse, Healthcare Technology Analyst, KeyBank: Perfect. Thank you for all of that. That’s really helpful. So let’s talk about your programs, in discovery. I think you have a portfolio of 20 programs, and you’re reducing your co development activity.

Let’s talk about that strategy, Martin, that’s developed over the last several years. Maybe, yeah, maybe deep dive on that strategy.

Martin Hogan, Director of Strategic Finance and Investor Relations, AbCellera: Yeah. Absolutely. And I’ll step back a bit further. Right? The foundation of the company really is to have built this this therapeutic area agnostic capability to discover antibodies that are, you know, either best in class, but more importantly, have the potential to be first in class.

And, we made that capability initially available to partners, which made sense because, you know, years ago, there was a lot to learn about how to, you know, how to really develop antibody based drugs. But with those learnings under our belt, the question then became, what is the most valuable way to deploy that capability? And, what we’ve seen is that earning downstream stakes in partners programs, has attractive economics, sort of the the, you know, the the number of times you can do that and have conviction that the partner is actually going to take the molecule forward successfully is limited. So the question then becomes, in which other ways or maybe even in which better ways can you deploy that capability? And, the answer here is, to really use it against a select number of programs where we, can either own the program outright because we knew and had all the capabilities in place, to pursue, an attractive target or in the case of co development to work with a partner who’s bringing to the table capabilities or insights that we don’t possess ourselves.

Right? And so the the shift here really is to become a drug developer. Right? So, you know, at the moment, preclinical and soon to be clinical stage biotech company. And to do that, on opportunities that leverage our capabilities in a way that gives us a competitive advantage.

So this is mostly in the space of, difficult or very difficult targets. And whether we do that, you know, with a partner or not, particularly in the co development space, depends on whether there, you know, is a partner that is bringing something to the table that we don’t possess ourselves. So good examples of, you know, where that is the case, you know, recently, I think at the beginning of twenty twenty four, we entered into a co development partnership with Prelude. Prelude has, you know, excellent capabilities in degradation of cells and in linker technology to link those degraders to antibodies, and those are capabilities that we didn’t have. Conversely, Prelude had no capability in discovering and developing antibodies.

So this is a great, you know, great example, for the kind of situation where it makes perfect sense for us to enter into a co development agreement where we jointly own and drive the program fifty fifty, if you will. Another example where, you know, this wasn’t exactly structured the same way, but we were a, a founding partner in, Abderra, Abderra developing radioisotope conjugate antibody antibodies effectively where, you know, we have no capability in, in radionuclides or in the, you know, Cholator and Linker technologies, whereas Abderra does and Abderra conversely, you know, relied on us to deliver the antibodies that, that make those therapeutics work. So those are examples where, you know, now and going forward, co development will make sense. But in other areas, we’re really we’re looking, you know, where it’s where there’s a clear opportunity to pursue, a target that meets our four criteria that we discussed earlier, and we have the capabilities in house. The most valuable way to deploy our capabilities is just to start those programs, under our own steam, bring forward development candidates, you know, typically tape them into a phase one study, and then depending, you know, on what that development path looks like, what potential partner interest looks like, either take them further or license them to somebody who is, you know, who’s who’s frankly a better owner of the molecule owing either to their therapeutic area expertise, you know, to their balance sheet or, you know, or to their ability to run multiple phase two trials in parallel as may well be the case for EBSELRI five seventy five.

Scott Schoenhouse, Healthcare Technology Analyst, KeyBank: Thank you, Martin. I want to shift over to your manufacturing capabilities. So many people may not realize that you or maybe do they do that you are about to complete. Have you completed the manufacturing capabilities yet, Martin?

Martin Hogan, Director of Strategic Finance and Investor Relations, AbCellera: Yes, good question. So in terms of manufacturing capabilities, the building exterior is complete. Machinery, I think, is equipment is arriving every day. Very importantly, the team is in place, and we’re expecting to have the, you know, most of the CapEx investments, related to this completed in the first half of this year and, for the facility to come online and start manufacturing the first batch by the end of this year. The, you know, the big strategic rationale here was to say, one, when you rely on CROs, you are or CDMOs, I guess, in in this case, you are somewhat constrained by their schedule, and the incremental cost to, you know, try out a second, you know, a second molecule as backup to your first is really quite high on the one hand.

And on the other hand, sort of an insight that said, we’ve been quite good at systematically capturing data from our efforts and learning, you know, either, you know, either sort of in a in a traditional sense of know how or in a, you know, data driven machine learning kind of way from our efforts to do drug development at previous stages, there may also be significant insights to be gained from the information that arises out of carrying out the CMC and the manufacturing, activities ourselves. Right? So so two reasons here. One, greater flexibility. Two, greater opportunity for learning how to, how to develop truly optimal drugs that also behave well in, in manufacturing.

And, we’re seeing this play out. The, you know, the initial investment in the facility was, you know, quite significant, but we did have the support from the governments of Canada and British Columbia who, you know, together funded roughly half of that investment, which made it feasible for us. And in terms of operating the facility, we’re now at a point where, you know, even if we have only around about two programs that go through the facility per year, we’re breaking even on a, you know, on a cash basis compared to leveraging a CDMO. And all the same while gaining significant flexibility where we can afford to say, hey, let’s advance two program like, two candidates in parallel or at least have one ready, you know, as backup that we could spin up quickly if the need arose, to not have to wait in line, for your initial slot, you know, where, you know, also where if there were a delay in the program, you wouldn’t lose your slot. You just use lose whatever time is there for the delay and thus giving us and also particularly co development partners a reliable standby capacity to quickly move into manufacturing and from there then into the clinic.

Given the wider, you know, geopolitical environment, we all recall the BioSecure Act, it’s also attractive to really have this, you know, in North America fully under fully under our control.

Scott Schoenhouse, Healthcare Technology Analyst, KeyBank: Lastly, I really want to touch upon your T cell engager platform, your TCE. You announced a significant partnership with AbbVie in January, and I think that really marks the first sort of catalysts for you guys on this platform. Maybe talk about this platform, what the AbbVie partnership represents and what you expect going forward for your TCE platform, Martin?

Martin Hogan, Director of Strategic Finance and Investor Relations, AbCellera: Yeah. Gladly. Our TCE platform is, you know, is the result of one of those efforts where we said, hey. We’ve got a we’ve got a, platform capable of finding finding antibodies, more better antibodies, than than certainly most others, maybe than anyone else. And about, you know, two to three years ago, it became pretty clear that, T cell engagement, so CD three based T cell engagement, could be a very effective way of treating cancer.

And since then, also, I think it’s become clear that it could also be very helpful in treating autoimmune conditions. And the whole field was limited by the availability of CD three engagers. I think, something like 80% of all CD three based T cell engagers are reusing the same mouse derived antibody, SP 34 dash two, that was discovered sometime, I think, late in the nineties, and had the problem you know, continues to have the problem of, you know, really activating T cells and in fact, probably overstimulating them causing cytokine release syndrome. So where, you know, you then struggle, with many of the existing CD three antibodies, combined in a t cell engager to find a therapeutic window where you are effectively knocking down your target, the tumor, without triggering cytokine release syndrome, which, you know, in the worst case, can be fatal. And so against that backdrop, we said, hey.

We believe we’ve got the ability to find many different CD three engaging antibodies and a scientific hypothesis that if you flexibly pair them with the right tumor engaging antibody, finding optimal pairs may allow you to achieve efficient tumor cell killing without triggering cytokine release or at least excessive cytokine release. And so with, you know, with those two convictions, we went to work and discovered what is definitively the, you know, largest, most diverse, best characterized panel of, CD three engaging antibodies out there and developed sort of the mech the the methods, the capability to, you know, assess many different possible pairings between those antibodies and, the antibodies engaging any specific tumor. And we’ve or or autoimmune target. We’ve demonstrated that at a, you know, at successive conferences at AACR and, SITC over the years, getting a lot of recognition, you know, from, from attendees typically flocking around our posters and acknowledging that this is, you know, this is truly unique and possibly a key building block to develop effective T cell engager based therapies. What happened in the meanwhile as this was going on was that earlier T cell engagers, you know, struggled.

We’d argue many of them probably because they did not have optimal CD three engaging antibodies as as part of the constructs. And the key players in the field became more cautious and, you know, we’re really looking for a more validation that our platform could succeed where where others failed. And I think as you correctly pointed out, with AbbVie, you know, at the end of, you know, or or during many conversations with all the large players in the field, AbbVie were the first to, you know, to sort of build that conviction that indeed with our platform, we had something that could, that could make a significant difference to their T cell engager based efforts. We continue to be in conversation with others. So this platform really is a platform where we are looking to make the capability available to any significant player in the, in the space who is looking to, develop a t cell engager, and we’re looking to make it available to them in whatever, you know, whatever mode makes most sense to them.

Be that, you know, just giving them access to their CD three panel, and allowing them to use their own target engaging antibodies in their own bispecific or multispecific platform. At the other end of the scale, two partners, who just provide sort of the target name and ask us to carry out the work of finding the target engaging antibodies, the optimal pairing, and, you know, doing the bispecific or multispecific, formatting and even taking it through preclinical development, and anything anything in between, really. We did also announce that we’ve launched a number of internal programs on the back of that platform. Some of those, you know, might enter our disclosed, you know, disclosed pre preclinical development pipeline at some point. Others may not because they were really more intended to demonstrate, the capability of the platform.

But overall, we view, you know, the panel and the, and the capabilities around it, as a significant asset that, you know, that has the attention of all the players, all the significant players in the field and, you know, the potential to, you know, to to fuel a good number of T cell engager based programs in the future.

Scott Schoenhouse, Healthcare Technology Analyst, KeyBank: Great. Well, we’re coming up on time. Thank you so much, Martin, for doing this fireside chat with me and thank you investors for joining us here. If you have any follow-up questions, don’t hesitate to email me directly, but thanks again so much, Martin.

Martin Hogan, Director of Strategic Finance and Investor Relations, AbCellera: It was my pleasure, Scott. Thanks again for having us.

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