OmniAb, Inc. Common Stock LD Micro 20th Annual Main Event Conference

Please welcome to the stage CFO of OmniAb, Kurt Gustafson. Excuse me, Kurt Gustafson. Thank you very much. I guess I will be doing an advertisement for Coca-Cola here. You, me, all of us in this room, we all have immune systems. Our immune systems have evolved over hundreds of millions of years, and our immune systems are designed to keep us safe from foreign things that come into our body. Think about a virus, cancer cell, even a piece of pollen. Some sort of foreign substance that comes into your body. Our immune systems are designed to go fight off that foreign substance, kill it or get rid of it, and remove it out of the body. At OmniAb, we have designed transgenic animals where we have swapped out the genes of those animals so that our animals actually have a human immune system.

In response to some sort of foreign threat, that cancer cell or virus or whatever, our animals will produce antibodies to go fight that threat. But the antibodies they produce aren't mouse or rat antibodies, they're actually fully human antibodies because of the way that we've adjusted out the genes of these animals. Big biotech companies and pharmaceutical companies come to us to get access to our technology to go discover drugs. Our business model is we let them use our technology and we take a piece of the action. They'll take a license from us to get access to our technology, and in return, they'll pay us milestones and royalties to the extent they identify something that they move forward. That's the essence of what OmniAb is, and let me now go into a few details here.

Before I begin, just a reminder, I'll make certain forward-looking statements. Those are outlined in our SEC documents. As I mentioned, what we have are these transgenic animals that produce fully human antibodies. We pair that with novel screening technology because once these animals produce these antibodies, we have to screen them. We have something that we call the power of BI and AI. BI is the biological intelligence that's built into our animals. The immune systems of these animals that actually can go figure out what's foreign and develop antibodies to go create that's the biological intelligence of our engine. Then we pair that with some proprietary screening technology that uses artificial intelligence to find the antibodies that those animals produce that go after the antibodies of interest.

We have what we feel is the best of both worlds, the power of BI and AI put together. We've got 110 partners using this technology. We're working with some of the major pharmaceutical companies in the world. Those companies have developed 425 different programs that are currently under active development. That's a net number we'll talk a little bit more about. If you add up all the milestones of those 425 programs, they add up to more than $3 billion with an average royalty rate of 3.4%. I'll talk a little bit more about the xPloration. xPloration is an instrument that we designed to go screen all of these antibodies, and we've had some partners recently come to us and say, "Hey, we might be interested in buying one of those." That's a new business opportunity that we've just launched.

At the end of the day, this is a licensing model. We do not develop drugs. We help partners find drugs. They come to us to take a license to our technology. In return, we will get paid an upfront fee. They may hire us to do research work for them. But the real sort of meat of the economics are as they take a molecule and move it into the clinic, they will pay us milestones, and hopefully eventually royalties if that drug is commercialized. Here is kind of a snapshot of the technology that we have. On the far left here, we have sort of the creation of the antibody. Here are all of our different transgenic animals that we have. We have mice, rats, and chickens, you see that up on the top, that create fully human antibodies.

We actually have animals that can produce bispecific antibodies, so these are antibodies that can connect to two different things. That is OmniClic and OmniFlic. This will sound a little bit out of science fiction, but we have actually developed animals that can produce very unique shaped antibodies. OmniDab and OmniUltra are examples of some of those. Just as an example, OmniDab comes from a llama where llamas actually make really unique antibodies. They are single-domain antibodies, thus the dAb name, but they are much smaller than regular antibodies. We have actually designed a chicken that will produce a llama-like antibody with a fully human sequence. We have a bunch of rockstar geneticists at our company that have designed all of these animals, and these antibodies are used for very specific reasons.

OmniDab, for example, because the dAb is so much smaller than a regular antibody, think about diseases that are in your brain where a regular antibody would not cross the blood-brain barrier. OmniDab, given its small size, these dAbs can cross the blood-brain barrier. We have had renewed interest in sort of the technology platform from a number of neuro players once we launch this technology. I thought I would put together this diagram of just sort of how this technology kind of works from a workflow standpoint.

Let us say you are a pharmaceutical company, you have interest in treating prostate cancer and your idea is, if I can hit this prostate cancer cell in this specific way, this specific receptor, but not this part, but kind of a little bit over here, we will work with you to design an antigen or the thing that we are going to give to our animal that sort of mimics that target that you are after. Usually it is a strand of RNA or a protein, and we will give that to one of our animals. Our animals will produce millions and millions and millions of antibodies, right? Some of them will be against that target that you want, but the animal is going to be producing millions of antibodies to all kinds of things.

We then use our proprietary screening technology, which is this xPloration machine that you see on the lower right-hand side. This instrument, in the span of an afternoon, can sort through millions of cells and figure out which of those antibodies are directed against the target that you want using a number of our artificial intelligence algorithms. You end up with all of these antibodies that are then targeted against your specific target. Eventually, you'll sort of decide which of those antibodies becomes the one that I want to take into the clinic and hopefully become a drug. That is kind of the workflow that we have. As I mentioned, we've been at this a while, so we've got 110 partners using this technology. These numbers continue to grow. These numbers are also net of attrition.

Sometimes these companies fail or whatever, and so these numbers can kind of grow and come down a little bit. But we're working with eight of the top 10 pharma companies, and you see the list of names here, kind of the who's who on the big pharma and biotech list. We've got 425 active programs. Once again, this is a net number, right. This business is a business where most stuff actually fails, and so we're constantly adding new programs. Certain things are failing and coming out, and so we always track our numbers net in terms of what is actually being currently developed, and that's 425 as of the end of June 30th. The other metric that we track is the number of programs in clinical development.

This is an important metric for us because as I mentioned, our licensing model, where we really start getting some more bigger economics is when things move into the clinic, right. So they start triggering milestones. We currently have 34 drugs that are in the clinic. If you were to kind of add up the milestones or the remaining milestones associated with those 34 drugs, it would add up to about $340 million. So there's a lot of money just in this later stage of development. Here's a snapshot of our pipeline, or I should say our partner pipeline. I want to highlight maybe just a couple of drugs on this that I think are exciting and our partners are clearly excited about. The first one is kind of there in the purple color there, called IMVT-1402. This is an asset being developed by Immunovant.

It's an FcRn, and they're going after five or six different indications. They've had some good data this year in difficult-to-treat RA. Next year, they will have the readout of their pivotal programs in myasthenia gravis and Graves' disease. Assuming those are successful, people think they will file next year. Most analysts have this drug launching in 2028. If I were to pull up the analyst reports for Immunovant and look at the consensus revenue estimate, the consensus view is this drug will be a $3 billion drug at peak sales. So this is a big drug going after a big market and pivotal data not too far away. So we'll see that data at some point next year. The other one I'll highlight just because they've had some really nice data this year, which is in phase II, the top one there, TEV-408.

They're going after the disease of celiac disease as well as vitiligo. They've reported out data from both of those indications earlier this year, and this drug looks amazing. It's an IL-15. The initial results look amazing. Teva said that they think this is a $2.5 billion drug. We'll see more data from these programs next year. Based on the results that they saw in these first two indications, they're actually now going to be going after certain types of dermatitis as well as alopecia. So almost a pipeline and a product for that one as well. Obviously a lot of other drugs. We had a few of these this year. The ramantamig at J&J went straight from a phase I to a phase III this year. We've been seeing some very nice progress from our partners in recent months.

We've got a lot more data coming. These are the clinical data readouts over the next 15 months from those various partner programs. There will be a steady drumbeat of clinical data that's coming out over the next coming months on products that are part of this pipeline. I mentioned a little bit about xPloration, which is our screening platform that can screen millions and millions of cells in the span of a very short period of time. We use this for our own workflow to go screen the antibodies that come out of our animals. A few of our partners came to us and said, "Hey, could we get one of those?" We did some additional development on the instrument, and last year we started making it available to partners.