2Q23 Achieves Important Milestones With More To Follow

New PDS0301 Combination Data To Be Presented

Answering Questions About The VERSATILE-002 Data

Reiterating Outperform – Phase 2 Trial Meets Efficacy Endpoint

Robert LeBoyer

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Healthcare

Biotechnology

PDS Biotechnology Corporation

Summary. PDS Bioscience announced additional patient evaluations from the Phase 2 VERSATILE trial have become confirmed responses, meeting the trials&nbsp;threshold for showing efficacy. This news comes as only 34 out of 54 patients have been evaluated, with the remaining patients to be evaluated in the coming months. This news should clarify the number of confirmed responders, and help eliminate any misunderstanding of the data presented at the ASCO conference earlier this month. The Phase 3 VERSATILE-003 trial is expected to begin in 3Q23. 
News Should Help Clarify ASCO Trial Results. In our <a href="https://www.channelchek.com/research-reports/25903">June 7 Research Note</a>, we discussed data from the VERSATILE-002 trial presented at the ASCO (American Society of Clinical Oncology) annual meeting. This presentation updated the preliminary data presented at the ASCO 2022 meeting, showing a 12-month survival rate of 87% and a progression-free survival rate of 10.4 months. Responses were determined by the RECIST 1.1 criteria, requiring 30% tumor shrinkage by MRI scan. According to the trial protocols, responses seen in the first scan were considered unconfirmed responses until a second confirmatory scan 9 weeks later. 
Response Rate For The Trial Has Been Met. The ASCO presentation reported an objective response rate (ORR) of 41.2% (14 out of 34 patients), with 26.5% (9 of the 34) patients reported as Confirmed Responses (CR). The remaining patients had not yet had their confirmatory scan when the data was collected and reported as unconfirmed responses. This led to misinterpretation of the data and questions on outcomes of the other patients. Since that time, additional patients had their second scan and now 14 patients are confirmed responses. This meets the trialâ€™s definition of efficacy even before the 20 remaining patients in the trial have been evaluated.
VERSATILE-002 Trial Design.&nbsp;The Phase 2 VERSATILE-002 trial tested the combination of PDS010 with Keytruda (pembrolizumab, an anti-PD-1 checkpoint inhibitor) in patients with recurrent/metastatic head and neck cancer. This was compared with published data for Keytruda alone, the current standard of care. After 12 months of treatment, the survival rate was 87% with progression-free survival (PFS) of 10.4 months. Median survival has not yet been reached. 
 
This compares with published Keytruda monotherapy data of 36% to 50% survival with PFS of 2 to 3 months. The overall response rate (ORR), defined as tumor shrinkage of 30% or more, of 41.2% was unchanged from the ORR at nine months and compares with published ORR of 19% in studies with Keytruda monotherapy.
The side effect profile continues to show no cumulative toxicities and compares favorably with Keytruda regimens with and without other chemotherapy agents. The only difference between the abstract and the final presentation was 1 additional patient reaching Grade 3 adverse events, raising the TRAE to 8.3% from 6.3%. We do not see this difference as significant. 
Figure 1. VERSATILE-002 Endpoints Compared With Keytruda Regimens. Data from the VERSATILE-002 trial presentations in 2023 and 2022 show substantial benefits over Keytruda alone or in combination with other chemotherapy agents. Importantly, the adverse events did not exceed Grade 3, making it more tolerable for patients. 
 <img decoding="async" src="https://www.noblelinx.com/x/research/images/reports/ascochart23.jpg" style="width: 571px;height: 150px" />
Source: PDS Biotechnology Corp. 
 
Distinguishing Between Confirmed And Unconfirmed Responses. Responses were determined by the RECIST 1.1 criteria (shrinkage of 30% or more). The first MRI scan showing 30% reduction in tumor size was considered an unconfirmed response until a second scan 9 weeks later confirmed the response.
As a result, the company reported an objective response rate (ORR) of 41.2% (14 out of 34 patients), with 26.5% (9 of the 34) patients showing Confirmed Responses (CR). The remaining patients had not yet had their confirmatory scan when the data was collected and considered unconfirmed responses. Since the time of the patient evaluations, additional patients have had their second scan to bring the number of confirmed responses to 14 patients. This meets the trial criteria for efficacy, and expect the remaining 20 patient evaluations to improve the efficacy rates further.
Multiple Studies Have Confirmed Efficacy And Mechanism Of Action. The new data adds to the growing evidence that PDS0101 induces an immune response against HPV16-positive tumor cells. The clinical development program has tested PDS0101 in combination with&nbsp;Keytruda or Triple Therapy (including PDS0301 and a checkpoint inhibitor) in different tumor types. These studies have reported efficacy and mechanism of action data showing that PDS010 leads to better response rates and overall survival than Keytruda alone. 
Conclusion. The ASCO 2023 data showed an improvement over current therapies and was consistent with our expectations for PDS0101. However, a misinterpretation of the data posted on a social media site on the day of the presentation led to a sharp price decline and a trading halt in the stock. Although the post was deleted, the stock has not recovered from the decline. We believe this is a buying opportunity and reiterate our Outperform rating and price target of $17 per share.

PDS Biotechnology Corporation (PDSB)

Reiterating Outperform – Phase 2 Trial Meets Efficacy Endpoint

Fundamental Analysis:

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2Q23 Achieves Important Milestones With More To Follow (PDSB)

New PDS0301 Combination Data To Be Presented (PDSB)

Answering Questions About The VERSATILE-002 Data (PDSB)

Reiterating Outperform – Phase 2 Trial Meets Efficacy Endpoint (PDSB)

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