Cantargia will present new clinical data at the AACR 2023 relating to IL1RAP in pancreatic cancer, the summary of which was published today. There were new interesting results from monotherapy patients.

23 pancreatic cancer patients in CANFOUR were treated with nadunolimab as monotherapy after failure of chemotherapy. IL1RAP levels were assessed in tumour biopsies taken from 17 patients. The results are presented below.

The results are clearly superior for the IL1RAP high patients, though they are not statistically significant (the p-value for mOS was 0.079 and for mPFS it was 0.073, so it was close). They are in line with the results already published from first-line patients in CANFOUR. The survival figures are poor for this patient category, especially for IL1RAP low patients. Cantargia also published the most recent data from the pancreatic cancer patients treated with combination therapy in CANFOUR, with better mOS and mPFS for IL1RAP high patients treated with nadunolimab and GEM-NAB versus IL1RAP low:

Public biomarker data furthermore suggest that IL1RAP is upregulated in advanced PDAC, and IL-1alpha and IL-1beta also show increased levels, confirming the validity of IL1RAP as a target in PDAC.

The new monotherapy results, though from a small number of patients, are interesting in that they suggest nadunolimab can be effective as monotherapy in IL1RAP high patients in pancreatic cancer. Cantargia has previously reported efficacy of nadunolimab as a monotherapy <a href="https://www.redeye.se/research/912624/cantargia-new-positive-readout-in-nsclc">leading to a complete response in NSCLC.</a> We will come back with an interview in a few days after the presentation (November 29). We restate our base case of SEK20.

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Cantargia

* Pre-revenue status with no profits and negative cash flow, requiring significant capital investment for drug development.
* High dependence on capital markets for funding, increasing vulnerability to market fluctuations and investor sentiment.
* Potential for binary outcomes in clinical trials, presenting a risk of core business failure if lead candidate nadunolimab is unsuccessful.
* Limited revenue diversification, with future dependence on partners for commercialization and revenue generation.
* Highly regulated industry environment, exposing the company to potential regulatory challenges and compliance costs.

* Strong potential for growth in oncology market, particularly in pancreatic cancer, supported by aging population trends and limited competition in the pipeline.
* Robust intellectual property protection through patents and proprietary clinical data, providing a competitive advantage for 10-15 years post-approval.
* Commitment to environmental sustainability and ethical practices, including energy reduction and waste management initiatives.
* Close collaboration with hospitals, research networks, and key opinion leaders in product development, ensuring alignment with customer needs.
* High employee satisfaction and low turnover, indicating a positive work environment and potential for talent retention.

* Lack of profitability: The company shows no positive gross profit margin, operating margin, or return on equity/assets.
* Weak historical growth: No evidence of consistent revenue or earnings growth above industry averages or historical rates.
* Poor financial health: Current assets do not sufficiently cover liabilities, and debt levels appear high relative to cash flow.
* Low earnings quality: The company fails to meet benchmarks for inventory management, accounts receivable, and cash flow conversion.
* No dividend power: The company does not demonstrate any positive indicators related to dividend yield, growth, or sustainability.

* Cantargia is not burdened by dividend obligations, allowing it to reinvest all available capital into research and development.
* The company's lack of debt-related metrics indicates it may have a clean balance sheet, potentially providing financial flexibility.

* Inconsistent delivery on promises, evidenced by delays in pancreatic cancer studies and early cancellation of three programs.
* Suboptimal capital allocation, as seen in the cancellation of three programs and inability to generate returns due to pre-revenue status.
* Weak insider ownership, with management and board members holding insignificant stakes in the company.
* Lack of gender diversity in leadership, with less than a third of board members being female.
* Absence of sustainability-related performance incentives in executive compensation plans.

* Strong founder mentality with CEO's long-term vision and deep industry knowledge, driving innovative drug development based on IL1RAP.
* Lean organization with a virtual business model, promoting self-direction and accountability.
* Transparent and timely communication, focusing on long-term business value and consistently presenting the same story and key metrics.
* Reasonable executive compensation structure with evenly distributed pay and sensible exit packages.
* Independent board with diverse expertise aligning with business strategy, capable of challenging management without adverse consequences.

Cantargia: New Clinical IL1RAP Data

Efficacy parameter according to iRECIST1.1

	median overall survival	median progression-free survival
IL1RAP high	5.8	3.6
IL1RAP low	2.6	1.6

Efficacy parameter according to iRECIST1.1	All patients (n=73)	IL1RAP high (n=29)	IL1RAP low (n=20)	Historical control [1] (n=431); RECIST
Overall survival (OS); median	13.2 mo	14.2 mo	10.6 mo	8.5 mo
Progression-free survival (iPFS); median	7.2 mo	7.4 mo	5.8 mo	5.5 mo (PFS)
1-year survival	58%	67%	39%	35%
Overall response rate (iORR)	33%	48%	30%	23%
Duration of response (iDoR); median	7.3 mo	9.5 mo	5.6 mo	NA