SAB Biotherapeutics Q3 2026 Earnings Call Transcript

SAB Biotherapeutics (NASDAQ:SABS) reported third-quarter financial results on Thursday. The transcript from the company’s third-quarter earnings call has been provided below.

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Summary

SAB Biotherapeutics reported strong progress in its clinical programs, particularly with SAB142, which received FDA Fast Track designation for stage 3 type 1 diabetes.

The Safeguard study has completed enrollment for adult and adolescent cohorts, with pediatric enrollment accelerated by a recent Data Monitoring Committee approval.

Financially, the company ended Q3 2026 with $205 million in cash, projecting sufficient funds through 2028, despite increased R&D and G&A expenses primarily due to SAB142’s clinical advancements.

The PRIZE study, an extension of the SAB142 program, is set to dose its first patient soon, aiming to expand the potential label for SAB142 to those up to two years from a stage 3 diagnosis.

Management expressed optimism about SAB142’s differentiation from competitors, highlighting its full human antibody approach and long-term redosing potential, while reaffirming guidance for future enrollment and data milestones.

Full Transcript

Sam

We recognize Diabetes Awareness Month and focus attention on the millions of people living with type 1 diabetes. We remain committed to advancing new medicines with the potential to change the course of the disease and improve the lives of those affected. That focus continues to drive our work at SAB Biotherapeutics and we’re pleased to have you with us today to review the progress we made during the third quarter. We continue to execute on our priorities for SAB142 with strong momentum in Safeguard enrollment and the FDA granting Fast Track designation to SAB142 for the treatment of new-onset stage 3 type 1 diabetes. For context, SAB142 is a fully human anti-thymocyte immunoglobulin designed to preserve insulin-producing beta cells in order to slow disease progression in autoimmune type 1 diabetes. It was developed using our proprietary Tc Bovine platform, which allows us to generate fully human multispecific antibodies without the need for human donors.

Because SAB142 is fully human, it has the potential to overcome key limitations of non-human approaches and enable safe redosing over the long term. We believe SAB142 represents an opportunity to help people with type 1 diabetes redefine what a stage 3 diagnosis can mean. SAB142 is currently being evaluated in two clinical trials, the registrational Phase IIb Safeguard study for those newly diagnosed with stage 3 T1D and the investigator-led Phase 3 PRIZE study for people up to two years from a stage 3 T1D diagnosis. Let’s start with an enrollment update for Safeguard. The performance of our clinical team this quarter has been exemplary. In September, the study’s Data Monitoring Committee approved the final step down to children ages 5 to 11, helping to further accelerate enrollment.

We continue to see strong interest in Safeguard from both patients and investigators, and we’re excited to share that the adult and adolescent cohorts are now fully enrolled and closed for screening. With that, we are reaffirming our guidance to complete enrollment of Safeguard in Q4 with top-line data expected in 2H27. Building on that progress, the PRIZE study expects to dose the first patient this quarter. There are seven clinical sites planned across the United States, Europe, and the UK. PRIZE is an important extension of the SAB142 clinical program as it would potentially allow a future label expansion for SAB142 to T1D patients up to two years from a stage 3 diagnosis. As a reminder, PRIZE is an investigator-led study supported by a grant from Breakthrough T1D co-funded by SAB Biotherapeutics.

We are grateful to Breakthrough T1D for its support and to Dr. Michael Haller at the University of Florida who serves as the study’s principal investigator. We also want to recognize Dr. Chantal Mathieu at UZ Leuven and Dr. Timothy Tree at King’s College London as co–principal investigators for their important contribution to the study. Beyond our clinical progress, we reached an important regulatory milestone in October when the FDA granted Fast Track designation to SAB142 for the treatment of new-onset stage 3 type 1 diabetes. This designation is intended to facilitate the development and expedite the review of therapies for serious conditions where there is an unmet medical need with the goal of bringing important new treatments to patients earlier. For SAB142, this designation gives the program some serious aura and importantly it provides valuable procedural benefits as we advance our program.

These include opportunities for more frequent meetings and written communications with the FDA, eligibility for rolling review of the future BLA, and potential eligibility for priority review if the applicable criteria are met. While Fast Track designation does not change the FDA’s standards for approval or ensure that SAB142 will ultimately be approved, we believe the benefits are meaningful as we move toward top-line data. We will continue to work closely with the FDA as we advance the SAB142 clinical program and we believe this designation represents meaningful progress toward our goal of bringing SAB142 to people living with type 1 diabetes as quickly as possible.

And with that I will hand the call over to Lucy, our Chief Financial Officer, for a recap of our third quarter financials.

Lucy To (Chief Financial Officer)

Thanks, Sam. We ended the third quarter with $205 million in cash, cash equivalents, and investment securities as of September 30, 2026. We maintain a strong cash position and project that our existing cash balance will fund our operations through 2028. This total includes $13.4 million in gross proceeds received in the third quarter from the exercise of our previously issued enrollment and data release warrants from our July 2025 PIPE. R&D expenses were $18.1 million for the third quarter of 2026 compared to $9.0 million for the same period in 2025. The increase is primarily driven by ongoing clinical trial costs and related headcount to support the advancement of SAB142 through the registrational Safeguard study. R&D expenses include non-cash stock-based compensation expense of $3.9 million for the third quarter of 2026 compared to $0.5 million for the same period in 2025. G&A expenses were $7.8 million for the third quarter of 2026 compared to $3.7 million for the same period in 2025.

The increase is primarily driven by personnel-related costs including non-cash stock-based compensation. G&A expenses include non-cash stock-based compensation expense of $3.6 million for the third quarter of 2026 compared to $0.3 million for the same period in 2025. Other income was $3.6 million for the third quarter of 2026 compared to $58.1 million for the same period in 2025. The decrease primarily reflects the change in fair value of warrant liabilities recognized in 2025.

As a result, net loss was $22.3 million for the third quarter of 2026 compared to net income of $45.4 million for the same period in 2025. Overall, we reaffirm our position to support SAB142’s clinical development in the Safeguard and PRIZE studies through key milestones while preparing for commercial readiness for SAB142. And with that I can turn it back over to Sam for closing remarks before we open the call for questions.

Sam

Thanks, Lucy. We’re pleased with the progress we made during the third quarter and enter the final months of the year with a clear focus completing enrollment in Safeguard and continuing to advance SAB142 toward top-line data. We’re incredibly grateful to our team and our investigators and clinical collaborators, the patients and families participating in Safeguard, and the broader diabetes community. Their commitment and engagement continue to drive our work and reinforce the importance of developing new therapies for people living with type 1 diabetes.

As we look to 2027, we are excited to move toward top-line data from Safeguard while continuing to build the capabilities and infrastructure needed to support SAB142 over the long term. We believe SAB142 has the potential to meaningfully change the treatment of type 1 diabetes and we are focused on delivering on that promise. We look forward to sharing our progress as we continue advancing SAB142 across our clinical programs and executing on our strategy.

And with that, we’re ready to take any questions.

OPERATOR

Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions.

The first question is from Michael Yee from UBS. Please go ahead.

Michael Yee (Analyst)

Hey guys. Good morning. Congrats on the progress on enrollment. As we think about the data ahead next year, could you sort of comment or reiterate your framing of expectations on that result in terms of C‑peptide and A1C and how important each of those are to hit for differentiation to Tzield? And secondly, given that Tzield now has a new stage 3 indication, while we’ve been talking with different docs, what are you hearing out there? What are you seeing?

And is that perhaps a pretty good indication of what the opportunity could be? Although it’s still early there. Thank you.

Sam

Thanks, Mike. I’ll answer the second part first and then hand it to Alexandra to answer the first question. So the second part on Tzield, we’re very encouraged by what we’re seeing with Tzield. The uptake in the community shows the importance of new medicines and it’s paving the way and establishing a pattern with doctors and patients to get treatment, to get a prescription, to preserve the pancreas when a patient is diagnosed. So we’re encouraged by what we’re seeing and I think it bodes well for SAB142.

As you know, we believe strongly that it’s a competitive product with fewer days of dosing. We’ll see where the results on the efficacy, but also we’ll overall have a better profile. So I think everything we’re seeing with Tzield is good news for the field and for SAB142. And for the first part, I’ll hand it over to our Chief Medical Officer, Alexandra, to answer the question.

Alexandra (Chief Medical Officer)

Thank you very much, Sam. We’re very hopeful about our upcoming data release next year. Of course, the primary endpoint is the preservation of the beta-cell function as measured by the area under the curve. C‑peptide is our primary endpoint and we’ll be reporting the results on that, where the statistically significant results versus the control arm will guarantee us the accelerated path to the approval for the drug. Now, ATG is a clinically validated mechanism of action where previous multiple clinical trials showed the important improvement in the glycemic control needed for the full approval of the medications in the disease-modifying therapies. And we will be releasing the data on the glycemic control as well based on the HbA1c and the continuous glucose monitoring.

Now, a third component of a very important differentiation profile of SAB142 versus Tzield is the low immunogenicity due to the fully human nature of the antibody that will allow the drug to provide the disease-modifying therapy over a lifetime of the disease patients, where the product can be redosed to continue maintaining the C‑peptide and preserving the residual beta cells not only over one or two courses, but for over much longer periods. So immunogenicity data and the safety data associated with the long-term redosing will be part of our top line as well.

Michael Yee (Analyst)

Great, thanks.

OPERATOR

The next question is from Ellie Merle from Barclays. Please go ahead.

Tejas (Analyst)

Hi, this is Tejas on for Ellie. Thanks for taking our question. My first one, just for the study in the patients two years from diagnosis, could you expand on just some of the different cohorts of patients across that two-year timeframe and what you’re looking to see in each of those? And then I have a follow-up.

Sam

Sure. So it’s a sister study to the Safeguard study. The protocol is exactly the same with one exception, which is the time from diagnosis. One cohort is age matched from the Safeguard population; that’s effectively the control and that’s patients within 100 days of diagnosis. One cohort is from 100 days to 365 days, which is that window out to a year. And what we call Cohort 3, or the third cohort, is from one year to two years. And the importance of that and that data is to prove that the thing that matters most with a patient is the amount of beta cells they have and our ability to preserve those.

And the T1D community and SAB want as many patients as possible to be able to get access to SAB142. And the PRIZE study is designed to show that we can provide a benefit to patients up to two years from diagnosis.

Tejas (Analyst)

Great. And then just a quick follow-up on timing. When could we expect to get data from any of these cohorts and how could that be used to support a label extension or inform a registrational trial in those various populations?

Sam

Well, so on the timing, I don’t know that we’re guiding to a specific time yet. As it’s an investigator-led study, I think we would expect it to be subsequent to Safeguard data. But we’ll see and we’ll keep you posted on that. As far as the label, pending good outcome, you know, we would hope to and have the potential to have time not be a basis for diagnosis and just beta cells. So if a patient with type 1 diabetes has adequate beta cells for preservation, there’s a possibility that that might be all required for being able to get treated and covered.

And maybe if you step it back to just one step more conservative, perhaps it’s up to two years from diagnosis, which will, you know, markedly expand the available total addressable market as well as have the ability to increase market penetration by not having this kind of gun to the head of a patient with “you have to get it now or you’re not going to be able to get it.”

Tejas (Analyst)

Yeah, really helpful. Thank you.

Sam

You’re welcome.

OPERATOR

The next question is from Roger Song from Jefferies. Please go ahead.

Chacha (Analyst)

Hi guys, this is Chacha on for Roger. I was hoping that you could give us more color in regards to the September DMC approval. Keen to share more on what safety parameters were particularly important in supporting the expansion to the pediatric population.

Sam

Sure, I’ll let Alexandra answer that.

Alexandra (Chief Medical Officer)

Thanks, Sam. So we have the independent Data Monitoring Committee that has been a part of the SAB142 development program for over the last two years. The DMC consists of one adult endocrinologist and two pediatric endocrinologists along with an independent biostatistician. For prescheduled, predefined DMC meetings, cumulative data for SAB142—which means that all data that were accumulated from the beginning, the very first patient enrolled in the trial all the way until the DMC scheduled meeting—were provided.

The data were provided to the DMC in an unblinded fashion. It means that the DMC saw the data by treatment arm versus control, and that’s all available safety data across populations, broken also down by the age groups: adult versus adolescent versus pediatric population. We had the DMC meetings that approved the step down as planned without any delays, indicating that the product behaves very consistently and there is no new safety signal identified in the ongoing Safeguard trial.

So we’re very, very pleased with how the product behaves and it’s again a very, very consistent safety profile across all age groups.

Chacha (Analyst)

Thanks, that’s helpful.

OPERATOR

The next question is from Yatin Suneja from Guggenheim Securities. Please go ahead.

Iris Gao (Analyst)

Hi, good morning, this is Iris Gao on for Yatin. Thank you for taking our questions and congratulations on the progress with both studies. So my first question would be, is there an update on how many patients have been redosed so far and is the drug still clean on ADA? And my second question would be about how does the PRIZE study affect the burn rate going forward? Thank you.

Sam

We haven’t disclosed to date how many patients have been redosed, but it’s going according to plan. And then the second part was—I’m sorry, could you repeat it? I didn’t hear it.

Iris Gao (Analyst)

Oh, yeah. The second part of the question: how do you expect the PRIZE study to affect the burn rate going forward?

Sam

We had included that study in our budgeting process. So the burn as guided has accounted for the PRIZE expenses and doesn’t change.

Iris Gao (Analyst)

Thank you.

OPERATOR

The next question is from Thomas Smith from Leerink Partners. Please go ahead.

Brian (Analyst)

Hey guys, good morning. This is Brian on for Tom. Congrats on all the progress and thanks for taking our questions. So first, given adult and adolescent cohorts here are fully enrolled in Safeguard, can you comment on if there’s anything notable in the baseline characteristics of the patients in these cohorts relative to your expectations? And then we have a quick follow-up.

Sam

I’ll let Alexandra answer that.

Alexandra (Chief Medical Officer)

Our baseline characteristics for both cohorts are comparable to the baseline characteristics of the respective age cohorts in previous trials, TN19 and mLD-ATG. So the data are very consistent again, even at the baseline.

Brian (Analyst)

Got it. Thanks so much. And our second question just on the PRIZE trial, understanding that in Safeguard we needed to have that step down from adults to pediatric patients, but can we expect a similar dynamic in PRIZE, given at least some of the overlapping patient population, or can you begin enrolling those pediatric patients once the study begins recruitment, given the safety data you’ve generated to date? Thanks so much.

Alexandra (Chief Medical Officer)

Yeah, excellent question. And yes, we are starting enrollment in the PRIZE study with the early age cohorts, considering that we already have a very significant amount of the safety data accumulated through Safeguard and the independent DMC committees across the program. So it’s the same DMC that already has seen all the data from SAB142 and previous trials and will be guiding and monitoring the safety in PRIZE.

Brian (Analyst)

Great, thanks.

OPERATOR

The next question is from Samantha Semenkow from Citi. Please go ahead.

Ben (Analyst)

Hello, this is Ben on for Samantha. Thanks so much for taking the question. Can you describe the level of physician interest in the PRIZE study? What kind of feedback are you receiving based on the site interactions? And then I have a separate question, if I may.

Sam

Yes, physician interest is very high. I think that we mentioned that Dr. Haller at University of Florida, Dr. Mathieu in Belgium, and Dr. Tim Tree at King’s College proposed this study design because of the tremendous interest. If you can imagine that both all the clinical research done with immunomodulation as well as now the first approved therapy, Tzield, limits a patient’s ability to get dosed to the first up to eight weeks. The Safeguard has been the most inclusive up to 100 days so far.

There’s a huge pent-up demand and frustration both at the physician level and the patient level of people who are being excluded from the ability to get therapy or participate in clinical research. So interest is high, demand is high, and it really is inbound interest from the T1D community and the academic community to SAB that we’re gladly collaborating with and accommodating.

Ben (Analyst)

And then, turning back to Safeguard, what is the pace of the pediatric screening and enrollment? Is it tracking with your expectations?

Sam

Yes, it’s good. We’re pleased by how it’s going and we’re reiterating that we expect to complete enrollment this quarter.

OPERATOR

The next question is from Ki Nakai from Chardan. Please go ahead.

Ki Nakai (Analyst)

Good morning. With respect to PRIZE’s Cohort C patients, it’s not clear to me from the inclusion/exclusion. How do you best handicap which patients at that duration of onset might be best suited to show a positive result?

Sam

I think it’s all about C‑peptide at baseline. It’s the same study design as Safeguard; the only difference is the time from diagnosis. So the amount of C‑peptide—meeting the inclusion criteria for baseline C‑peptide—is that. And Alexandra, do you have anything to add?

Alexandra (Chief Medical Officer)

And the additional parameter is the age groups. Similar to Safeguard, we have predefined parameters for the sample size across the adult, adolescent, and pediatric population in approximately similar one third of each population, since the disease progression may be dependent on age as well. So baseline C‑peptide and age are two parameters that participate in the stratification randomization at the baseline of the PRIZE ATG participants.

Ki Nakai (Analyst)

All right, thanks.

OPERATOR

The next question is from Seema Shuran from Rodman Financial. Please go ahead.

Seema Shuran (Analyst)

Hi. Thank you for taking my questions and congrats on the progress. So in April you presented impressive four-patient data where three patients, described as super-responders, showed C‑peptide levels above baseline at 120 days, or four months. My understanding is that this cohort is not receiving additional doses whereas Safeguard includes redosing. I’m just curious to know how C‑peptide levels have evolved with longer follow-up in these four patients and what that suggests about the durability of response without redosing.

Thank you.

Sam

So the data we presented from the Phase 1 study was the complete data set. The study was 120 days long. That was the last study visit and so we have not collected data beyond that.

Seema Shuran (Analyst)

I see. Okay, thank you.

OPERATOR

This concludes the question and answer session as well as today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.

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