Corvus Pharmaceuticals, Inc. 2026 Q2 Earnings Call

Good afternoon, everyone. Thanks for joining us for the Corvus Pharmaceuticals second quarter 2026 business update and financial results conference call. On the call to discuss the results and business updates are Richard Miller, Chief Executive Officer, Leiv Lea, Chief Financial Officer, Jeff Arcara, Chief Business Officer, and Ben Jones, Senior Vice President of Pharmaceutical Development. The executive team will open the call with some prepared remarks, followed by a question and answer period. I would like to remind everyone that comments made by management today and answers to questions will include forward-looking statements.

Forward-looking statements are based on estimates and assumptions as of today and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied by those statements, including the risks and uncertainties described in Corvus's annual report, quarterly report on Form 10-Q for the quarter ended June 30, 2026, and other filings the company makes with the SEC from time to time. The company undertakes no obligation to publicly update or revise any forward-looking statements, except as required by law. With that, I'd like to turn the call over to Leiv Lea.

Leiv? Thank you, Zack. I will begin with a brief overview of our second quarter 2026 financials.

Then turn the call over to Richard for a business update. Research and Development expenses in the second quarter of 2026 total $16 million, compared to $7.9 million for the same period in 2025. The increase in R&D expenses was primarily due to higher clinical trial costs associated with the development of soquelitinib, as well as an increase in personnel costs. Net loss for the second quarter 2026 was $18 million, compared to a net loss of $8 million for the same period in 2025.

Included in the net loss for the second quarter of 2026 and 2025 were non-cash losses of $0.7 million and $0.4 million, respectively, from Corvus's equity method investment in Angel Pharmaceuticals, and a non-cash gain of $2 million in the second quarter of 2025 associated with a change in fair value of the company's warrant liability. Total stock compensation expense for the three months ended June 30th 2026 was $2.6 million, compared to $1.3 million for the same period in 2025. As of June 30th 2026, Corvus had cash equivalents, and marketable securities totaling $215.2 million as compared to $56.8 million at December 31st 2025. Cash as of June 30th 2026 included approximately $189.4 million in net proceeds received in a follow-on offering completed in Q1.

As announced on June 9th 2026, Corvus invested $5 million in a $13.5 million financing completed by Angel Pharmaceuticals in the second quarter of 2026. Based on our cash position at June 30th 2026 and our current plans, we expect our cash to fund operations into the second quarter of 2028. I will now turn the call over to Richard, who will discuss our clinical progress and elaborate on our strategy and plans.

Thank you, Leiv, and good afternoon, everyone. Thank you for joining us today for our update call. We are highly focused on soquelitinib, our first-in-class selective ITK inhibitor. Our efforts are primarily directed to driving patient enrollment and executing on our clinical trials to reach the next milestones for soquelitinib's two lead opportunities. Our phase III peripheral T-cell lymphoma program, or PTCL, and our phase II atopic dermatitis program. In parallel, we continue to advance soquelitinib's development across broad areas of medicine, including near-term plans to initiate trials in hidradenitis suppurativa and asthma, as well as the ongoing trial at the NIAID in ALPS. The growing body of clinical and pre-clinical evidence supports the broad potential of soquelitinib based on its novel mechanism of action and ability to reset or rebalance immunity.

Our ongoing development efforts with soquelitinib position Corvus to deliver key data readouts and milestones associated with our pipeline over the next year. I will start with a brief update on our phase III trial in relapsed refractory PTCL, which is planned to enroll 150 patients randomized one-to-one between soquelitinib and standard of care chemotherapy with belinostat or pralatrexate. The primary endpoint is progression-free survival, or PFS, which with current treatment options, has a median of about three months. Enrollment is on track with our expectations, with the next milestone being a futility analysis that will be conducted after a predefined number of PFS events have occurred. Based on current trends, we believe this interim futility analysis will occur in the first quarter of 2027.

The futility analysis will be conducted by an independent data monitoring committee that will determine whether the study should be continued or terminated for futility based on available safety and efficacy data at the time. No safety or efficacy data will be publicly released at that time. We remain excited about the potential of soquelitinib to provide a new treatment option for patients with relapsed refractory PTCL, particularly given the challenges with current therapies, none of which are fully approved for this indication. I should also mention that the results of our phase I trial are now in press in "Blood," the peer-reviewed medical journal of the American Society of Hematology. We expect the results will be published later this year, providing an important overview of soquelitinib's mechanism of action, rationale, and data obtained from the phase I trial.

Some of this data was presented at the ASH meeting last year. Turning to our other high-priority indications for soquelitinib atopic dermatitis. We remain very excited about the data to date and our path forward in this indication. During the second quarter, we presented the final data from the randomized, blinded, placebo-controlled phase I trial evaluating soquelitinib in patients with moderate to severe atopic dermatitis at the Society for Investigative Dermatology, or SID annual meeting. The data demonstrated safety and positive efficacy results, including 75% of soquelitinib patients achieving EASI-75 in Cohort 4, compared to 20% of placebo patients. Cohort 4 studied is the highest dose and longest dosing period tested in the trial, covering 24 patients randomized in a one-to-one ratio to receive 56-day, 8 weeks, 200 milligram twice a day daily regimen of soquelitinib or equivalent placebo.

In addition to the compelling EASI-75 result, 25% of soquelitinib patients in Cohort 4 achieved EASI-90, and 33% achieved an IGA 0 or 1. No patients receiving placebo achieved EASI-90 or IGA 0/1. Importantly, soquelitinib's efficacy results were observed in patients who received prior systemic therapy, some of whom were confirmed to be treatment-resistant to these systemic therapies. The data also showed a dose-dependent efficacy trend and additional clinical benefit with longer treatment. Of significant interest was the observation of prolonged treatment benefit extending beyond the period of dosing without evidence of disease rebound. Disease rebound has been observed with other agents, including dupilumab, JAK inhibitors, and STAT6 degraders and inhibitors. The finding of soquelitinib's durable activity was not surprising given research done by Corvus and others demonstrating that ITK blockade results in enhancement of T regulatory function.

In the SID presentations, we presented compelling data correlating the induction of Tregs with prolonged clinical responses. If confirmed in future studies, these findings may usher in a new treatment paradigm for autoimmunity, resetting or rebalancing of immunity. On the safety front, no significant safety issues were observed. No severe or serious adverse events were reported, and no significant lab abnormalities were seen. There was no conjunctivitis and, of course, no injection site problems since it is an oral drug. There was no difference in adverse events seen comparing placebo to the active groups. All of this is in line with our experience with soquelitinib in lymphoma patients, some of whom are on continuous drug for over 2 years.

Based on its novel mechanism of action, oral dosing, and the safety and efficacy data to date, we believe soquelitinib could become a leading therapy for atopic dermatitis that may find a valuable role in frontline therapy or treatment of relapsed refractory disease. Our strategy is to progress soquelitinib as quickly as possible through the typical development pathway, similar to the other approved systemic therapies for atopic dermatitis. This includes our phase II trial, the SIERRA-1 trial, which is currently enrolling patients, followed by the usual phase III trials. These trials will have a primary endpoint based on EASI score and IGA score at 12 or 16 weeks of therapy compared to placebo. Our goal is to make soquelitinib available as soon as possible for patients, and then expand the clinical evidence and label with post-marketing studies exploring some of its more unique attributes.