Celldex Therapeutics Inc (CLDX) 2010 Q2 法說會逐字稿

Good morning, and welcome to Celldex Therapeutics Second Quarter 2010 Financial Results and Business Overview Conference Call.

My name is Onika, and I'll be your operator on today's call.

Before we begin our discussion, I would like to caution listeners that today's speakers will be making forward-looking statements.

Such statements reflect on current views with respect to future events and are based on assumptions and subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements.

Certain factors that may cause Celldex's actual results to differ materially from those in the forward-looking statements include those set forth under the headings Business Risk Factors, Management Discussion, and Analysis of Financial Condition, Results of Operation in Celldex's Annual Report on Form 10-K, quarterly reports on Form 10-Q and its current reports on Form 8-K, as well as those described in Celldex's press release and filings under the Securities and Exchange Commission.

You should carefully review all of these factors and be aware that there may be other factors that could cause these differences.

These forward-looking statements are based on information, plans, and estimates of this call, and Celldex does not promise to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events, or other changes.

Please be advised that the question and answer period will be held at the close of the call.

I would now like to turn the call over to Mr.

Anthony Marucci, President and CEO of Celldex Therapeutics.

You may proceed.

Thank you, operator.

Good morning, and thank you for joining us today.

I'm Anthony Marucci, President and CEO of Celldex.

Joining me on the call from Celldex this morning are Dr.

Tom Davis, our Chief Medical Officer; Mr.

Chip Catlin, our Chief Financial Officer; and Dr.

Tibor Keler, our Chief Scientific Officer.

I'm also very pleased to welcome a special guest, Dr.

Linda Vahdat, the lead investigator of our Phase 1/2 study of CDX-011 in metastatic breast cancer.

Dr.

Vahdat presented results from CDX-011 at ASCO in June and we'll share those results with you today.

As a brief background, Dr.

Vahdat was recruited to the Weill Cornell Medical College in 2002 to develop and solidify Cornell's breast cancer program.

Her major research interests include strategies to understand and prevent metastases in breast cancer and evaluation of new therapies and approaches to controlling breast cancer.

She also has an interest in understanding side effects of certain drugs.

She serves as a Professor of Medicine at the Weill Cornell Medical College and is a practicing physician at the Weill Cornell Breast Center, the Medical Oncology/Solid Tumor Program, the Cancer Care and Blood Disorders Program, and the Iris Cantor Women's Health Center.

On behalf of Celldex, I'd like to thank Dr.

Vahdat for joining us today.

To date, Celldex has made significant progress in advancing our PTI platform and our pipeline.

During the year, we have presented positive data from multiple programs at the annual meetings of both AACR and ASCO and initiated a randomized, Phase 2 study of CDX-1307 in front-line bladder, which we named the N-ABLE Trial, which is an acronym for Neoadjuvant and Adjuvant Bladder Cancer Trial.

On our call this morning, we will review these accomplishments, provide a brief financial overview and close by outlining key events expected for the second half of the year.

And we'll also look forward to taking your questions at the close of the call.

Before I turn the call over to Tom Davis, I would briefly like to thank our investigators who presented our clinical data at ASCO.

As you are aware, we had a very positive and busy ASCO, with data accepted from three product candidates for four presentations.

In collaboration with our partner Pfizer, Dr.

Rose Lai, a Board-Certified Neurologist and Assistant Professor of Neurology from the Neurological Institute of Columbia University in New York, presented data from the Phase 2 ACT III study of rindopepimut in glioblastoma multiforme - or GBM.

Dr.

Vahdat presented data on Celldex's Phase 2 antibody drug conjugate, CDX-011, in breast cancer and Dr.

Omid Hamid, a Board-Certified Medical Oncologist and Director of the NeuroOncology Clinic from the Angeles Clinic and Research Institute in Santa Monica, California, presented data from our ongoing Phase 1/2 study of CDX-011 in metastatic melanoma.

And Dr.

Deborah Bradley, Assistant Professor of Medicine at Duke University Medical Center, presented our ongoing Phase 2 study of CDX-1307, an antibody-based vaccine in muscle-invasive bladder cancer.

I'm now going to ask Doctors Tom Davis and Linda Vahdat to walk you through these presentations.

Tom, will you take the lead?

Thanks, Anthony.

Before I begin, I just wanted to note that CDX-110 has reached an administrative milestone.

It's been assigned the generic name rindopepimut, which is how we'll refer to that candidate moving forward to avoid any confusion.

Rindopepimut is an investigational immunotherapeutic vaccine that targets the tumor-specific molecule epidermal growth factor receptor, variant III or EGFRvIII.

Rindopepimut was developed by Celldex and was partnered with Pfizer in 2008.

As Anthony referenced, at ASCO, Dr.

Lai presented interim data from ACT III, a Phase 2 trial of rindopepimut in patients with glioblastoma - or GBM - the most aggressive form of brain cancer.

The ACT III study is the largest clinical trial of rindopepimut to date, enrolling 65 patients across approximately 25 sites in North America.

We're excited about the presented ACT III results because the data do confirm the positive findings from previous studies, but in a much larger setting that included multiple, diverse clinical centers and investigators.

The ACT III Phase 2 trial is a single-arm study in newly-diagnosed patients with EGFRvIII-expressing glioblastoma who've undergone surgical - or gross total - resection followed by conformal radiation therapy and concurrent oral temozolomide - essentially, the standard of care.

Following completion of chemoradiation, enrolled patients received intradermal injections of rindopepimut mixed with GM-CSF every other week for three doses, then monthly dosing in conjunction with temozolomide maintenance therapy for up to 12 cycles or until intolerance or tumor progression.

After completion of temozolomide maintenance, rindopepimut monthly administration was allowed to continue until progression or intolerance.

The primary endpoint of the study is progression-free survival at 5.5 months from study day O, or randomization.

As this trial enrolled patients at the completion of initial chemoradiation, which requires over three months, the 5.5-month endpoint correlates with approximately 8.5 months since diagnosis or surgery, which is the start point used in many other trials, including the previous ACTIVATE and ACT II studies, the earlier Phase 2 trials testing rindopepimut.

Secondary endpoints include safety and tolerability, overall survival, progression-free survival, cellular and humoral immune responses.

The study was fully accrued by the presentation date of ASCO and the data presented at such time reported on the interim efficacy analysis of progression-free survival for the first 40 treated patients, with preliminary safety data for 60 treated patients.

At the time of the interim analysis, 40 patients were available for disease status at 5.5 months, and 28 of these 40 patients were alive without progression at 5.5 months, which reflects an observed progression-free rate of 70% at that time point, 5.5 months post study entry.

Again, this is roughly equivalent to 8.5 months post-diagnosis, so any comparisons need to be made with that figure.

Importantly, rindopepimut continues to generate a very solid safety profile.

The most common treatment-emergent adverse events include injection site reactions, nausea, fatigue, and headache and the majority of adverse events were grade 1 or 2.

The most frequently reported grade 3 or 4 AEs were hematologic toxicities and abnormal laboratory values that were likely related to the treatment with temozolomide.

AEs attributed primarily to rindopepimut vaccine included some redness and itching at the injection site in 97% of patients and mild, systemic allergic reactions in 5%.

Interim results presented to date are very promising and exciting on multiple levels.

First, the observed progression-free rate of 70% at 5.5 months is clinically meaningful in light of the progression-free survival of 6.3 months and 35% observed progression-free rate recorded for historical controls from Duke and MD Anderson, which was presented at ASCO 2009.

These results are supported by excellent immune response data, with mean titer of anti-EGFRvIII antibodies in the study shown to increase with increasing time on study, directly supporting the strong immunogenicity of rindopepimut.

Second, as I mentioned, the ACT III data confirmed results from previous clinical studies of rindopepimut, but now in a much more robust clinical trial setting.

And, third, when you look across all three Phase 2 clinical studies of rindopepimut, we're seeing a very consistent, solid safety profile.

Again, most AEs are mild in nature and manageable.

The growing profile for this candidate continues to support a significant potential future role for rindopepimut for the treatment of GBM - a devastating disease with an undeniable need for more effective therapies.

As previously reported, Pfizer has undertaken an important initiative related to the future study of rindopepimut.

They've entered into an agreement with a unit of Qiagen to develop a companion diagnostic test kit for rindopepimut.

The diagnostic will be a real-time, PCR assay used to detect EGFRvIII RNA in tumor tissue.

We're working with Pfizer on the performance of a confirmatory, international, randomized controlled trial, a critical next step in the development of rindopepimut.

Now turning our attention to CDX-011, CDX-011 is an experimental antibody drug conjugate directed against glycoprotein NMB and linked to a potent cancer-cell-killing drug monomethyl auristatin E - or MMAE.

MMAE is a very potent, tubulin-binding cytotoxic agent.

CDX-011 is designed to be stable in the bloodstream, but to release MMAE upon internalization into GPNMB-expressing cells, resulting in a targeted cell-killing effect.

GPNMB is a novel glycoprotein expressed in the majority of breast cancers, as well as in other tumor types.

And GPNMB is expressed within the tumor by epithelial cells and, more frequently, by the supportive stromal cells.

It promotes the migration, invasion, and metastasis of breast cancer and its expression correlates with the worst outcome for the patient.

Patients with high GPNMB-expressing tumors have significantly shorter periods of metastasis-free disease and significantly shorter overall survival.

Celldex presented compelling proof-of-concept results at the San Antonio Breast Cancer Symposium in December of 2009.

The data demonstrated that treatment with CDX-011 induced disease regression and stabilization in heavily pretreated, refractory populations of patients with breast cancer - including patients with triple-negative disease.

When we did an analysis of the data focusing on patients that had cancers that express GPNMB at significant levels, there was a correlation with a greater clinical activity and improved outcome when compared to historical controls.

Since presenting the data at San Antonio, we've developed a centralized assay that's intended for use in future studies of CDX-011 in breast cancer.

And, in the poster recently presented at ASCO, we reviewed mature clinical results for the safety portion of the study and presented results of the GPNMB-expression analysis.

I'll now ask Dr.

Vahdat to walk you through the study design and results.

Dr.

Vahdat?

Thank you, Tom.

Before we dive into the data, I think it would be useful to provide you with some quick demographics on this patient population to help put these results into context.

(technical difficulties).

Linda, you seemed to have cut out.

Could you start over again, please?

Absolutely.

Okay.

Before we dive into the data (technical difficulties).

Well, I think it would be useful to provide the context with some quick demographics on this patient population to help put these results into context.

The study enrolled a population of patients with advanced disease that were heavily pretreated.

95% of patients had Stage IV disease and the median number of prior regimens was seven, with a range of 2 to 18 treatments.

83% of patients had metastatic disease in the liver and/or lungs and 32% had triple-negative disease.

Patients with triple-negative disease have a form of breast cancer that has tested negative for three key receptors - estrogen receptors, progesterone receptors, and the human epidermal growth factor receptor 2, commonly called HER2.

Without these receptors, the growth of a patient's cancer is not as likely to be fueled by estrogen or progesterone or by growth signals coming from the HER2 protein.

Triple-negative breast cancer does not respond to hormonal therapies, such as tamoxifen or aromatase inhibitors, or to therapies that target HER2 receptors, such as Herceptin, or to standard chemotherapy.

This makes treating these women much more challenging and there is a clear need for more effective treatment options for women with triple-negative disease.

In the Phase 1 portion of the study, sequential cohorts of patients were treated with escalating doses of CDX-011 to the predefined maximum of 1.88 milligrams per kilogram given once every three weeks.

The Phase 2 portion of the study enrolled an expanded cohort of patients at that maximum dose, for a total study population of 42.

The primary endpoint for the Phase 2 study portion, which called for at least 20% of the patients to be progression-free at 12 weeks, has been met with 9 of 26, so 35%, progression-free at 12 weeks.

For all patients treated at the maximum dose level, tumor shrinkage was seen in 62% of patients, and PFS was 9.1 weeks.

A subset of 10 patients had triple-negative disease.

In these 10 patients, 78% had tumor shrinkage.

The 12-week progression-free survival rate was 70%.

And median progression-free survival was 17.9 weeks.

Tumor samples from a subset of patients across all dose groups were analyzed for GPNMB expression using a newly developed, centralized assay intended for use in Phase 2 studies of CDX-011, and outcomes were examined for patients with significant stromal and tumor cell expression of GPNMB.

The new assay proved sensitive, with significant GPNMB expression in 64% of those tested at the maximum dose.

And, in the subset of these patients with significant stromal or tumor cell expression of GPNMB, the overall response rate was 22%, median PFS was 17.3 weeks, and the 12-week progression-free survival rate was 67%.

The antitumor effect of CDX-011 in patients with strong stromal expression of GPNMB may be due to both a bystander effect, in which MMAE is released from the GPNMB-expressing stromal cells, killing neighboring tumor cell populations, as well as the direct depletion of supporting stromal cells that are necessary to support the cancer cells.

While the sample size is small for patients with GPNMB expression in the study, the analysis supports additional studies in a larger patient population.

Of the patients with tumor tissue tested for GPNMB, two achieved objective, confirmed partial responses.

One of these showed strong stromal expression of GPNMB and experienced a response duration of 27 weeks, while the second, a patient with triple-negative disease who showed significant expression of GPNMB in both the tumor cells and the stroma, experienced over 50% tumor shrinkage and has continued on treatment for over 61 weeks.

Since CDX-011 contains a very potent chemotherapy, it does induce toxicity, including rash, neuropathy, neutropenia, and other side effects consistent with this class of drugs.

However, the selected Phase 2 dose appears to be tolerable for future trials.

We'll certainly provide an opportunity for any questions to Dr.

Vahdat at the end of this presentation.

But based on the Phase 1/2 results just described, Celldex is planning to conduct a Phase 2b study in patients with advanced breast cancers that express GPNMB, including patients with triple-negative disease.

Celldex plans to initiate a randomized trial with a two-to-one randomization to experimental arm; so, a controlled study across 20 to 25 academic and community sites that will enroll 120 patients.

Centralized tissue screening will be conducted using the new assay, and the trial will allow crossover from the control arm to the CDX-011 arm upon disease progression.

Both response rate and progression-free survival will be evaluated as endpoints.

And we plan to initiate this study in the third quarter of this year.

At ASCO, we also presented results from a second study of CDX-011 in advanced melanoma.

Metastatic melanoma frequently expresses GPNMB.

The data presented were from the Phase 2 portion of the multi-center, open-label, Phase 1/2 study of CDX-011 in patients with unresectable, stage three or four melanoma.

A total of 36 patients were enrolled in the Phase 2 expansion, and CDX-011 was administered at the predefined, maximum-tolerated dose of 1.88 milligrams per kilogram given once every three weeks.

The primary activity endpoint of overall response rate was achieved with an overall response rate of 15%.

Median progression-free survival was 3.9 months.

A more frequent dosing schedule was evaluated in two additional, parallel, dose-escalation arms, in which patients received CDX-011 weekly or twice every three weeks.

The response rate was observed to be 20% and 33% at the MTD in these arms, respectively, although there are only a limited number of patients in each cohort.

Preliminary data also suggests an increase in PFS in patients with high tumoral GPNMB expression.

The subset of seven patients whose tumors were found to express high amounts of GPNMB and who were treated at the maximum-tolerated doses across all dosing schedules demonstrated a median PFS of 4.9 months.

The development of rash, which may be associated with the presence of GPNMB in the skin, correlated with greater PFS.

The most frequent treatment-related adverse events included rash, fatigue, alopecia (or hair loss), pruritus, diarrhea, and neuropathy.

While melanoma is a difficult disease for novel therapeutics, these results are considered very promising by investigators who are eager to further evaluate CDX-011 in larger studies of patients whose melanomas express GPNMB at high levels.

We're very supportive of this approach and are looking for external funding for this important program.

Lastly, at ASCO we presented the study design for our Phase 2 trial in CDX-1307 in bladder cancer, which we initiated in May of 2010.

CDX-1307 is the first antibody-based cancer vaccine designed to induce robust immune responses against cells contained in the beta chain of human chorionic gonadotropin, hCG-beta, found in many types of epithelial tumors.

hCG-beta appears to directly facilitate cancer progression and has been shown to correlate with poor prognosis.

CDX-1307 consists of a fully human monoclonal antibody with specificity for the mannose receptor on dendritic cells genetically linked to the hCG-beta tumor antigen and combined with two toll-like receptor agonists - resiquimod and Hiltonol, which are agonists for TLR7/8 and 3, respectively.

The TLR agonists are provided by 3M and Oncovir, respectively.

The Phase 2 randomized study is enrolling approximately 60 patients with newly diagnosed hCG-beta expressing, muscle-invasive bladder cancer who have not previously received any chemotherapy for their disease.

These chemo-naive patients will be most likely to have intact immune systems that are best able to generate a potent anti-tumor response.

Following screening with an hCG-beta diagnostic assay, the patients are randomized in a ratio of one to one to receive a standard neoadjuvant therapy, gemcitabine and cisplatinum, either with or without CDX-1307, prior to their bladder resection.

Following bladder resection, the patients randomized to receive neoadjuvant CDX-1307 will also receive adjuvant CDX-1307 for up to one year.

Patients will be evaluated for pathologic complete response in resected tumors after neoadjuvant therapy and relapse-free survival is two years.

In addition, we are evaluating immune response, anti-hCG-beta effects on the resected tumors, including hCG-beta expression and immune infiltration, safety, and overall survival.

Approximately 15 to 20 US sites participate in the study, and preliminary data is expected by year-end 2011.

This study offers many opportunities to understand the immunologic and clinical effects of CDX-1307.

So, that concludes our ASCO presentation.

I'll now turn the call over to Chip to review financial results.

Thank you, Tom.

For the second quarter ending June 30, 2010, Celldex reported a net loss of $9.5 million, or $0.30 per share, compared to a net loss of $8.7 million, or $0.55 per share, for the second quarter of 2009.

For the six months ending June 30, 2010, Celldex reported a net loss of $16.1 million, or $0.51 per share, compared to a net loss of $16.4 million, or $1.04 per share, for the six months ending June 30, 2009.

The net loss of $9.5 million for the second quarter of 2010 represents an increased loss of $0.8 million when compared to the net loss for the same period in 2009 and is primarily due to the increases in research and development, amortization, and interest expenses in the second quarter of 2010, offset partially by decreases in general and administrative expenses.

The net loss of $16.1 million for the first six months of 2010 is slightly lower than the net loss of $16.4 million for the same period in 2009.

Higher operating and interest expenses were incurred during the first half of 2010 compared to 2009, as we have initiated the Phase 2 trial for CDX-1307 and are preparing to initiate a Phase 2b study of CDX-011 in metastatic breast cancer.

Higher operating expenses in the first three and six months of 2010 compared to 2009 also reflect the combined operations of Celldex and CuraGen for the full three- and six-month periods in 2010.

These higher expenses were partially offset by the receipt of a sub-license income payment of $3 million from TopoTarget in the first quarter of 2010.

At June 30, 2010, Celldex reported cash, cash equivalents, and marketable securities of $65.8 million, a decrease of $9.5 million from March 30, 2010.

The decrease is due primarily to operational expenses, $1.4 million in severance payments made related to the CuraGen acquisition, and $0.7 million in capital expenditures made during the second quarter of 2010.

The remaining severance payments of $0.5 million and $0.7 million will be made in 2010 and 2011, respectively.

We believe that expected cash inflows from our existing collaborations, interest income on invested funds, and our current cash, cash equivalents, and marketable securities at June 30, 2010 are sufficient to meet estimated working capital requirements and fund planned operations into 2012.

As of June 30, 2010, Celldex had approximately 31.9 million shares outstanding.

I will now turn the call back over to Anthony for closing comments.

Thank you, Chip.

As you have heard, we have made significant progress in the first half of the year.

As we look forward to the second half of 2010, we will continue this momentum by initiating a Phase 2b study of CDX-011 in advanced breast cancer patients, as well as presenting data for CDX-1401 at the International Society of Biological Therapy of Cancer, or iSBTc, at a meeting in October.

We also expect Pfizer to present rindopepimut data at the Society of Neural Oncology, or SNO's, annual meeting in November on the complete 65-patient data set from the ACT III study.

In addition, in the fourth quarter of this year, we plan to initiate a Phase 1 trial of CDX-301 in healthy subjects.

The product is FLT3 ligand, a hematopoietic growth factor that has had some previous experience in human trials.

We acquired this program from Amgen last year and believe there are very specific clinical opportunities for CDX-301.

Our first priority is to develop this molecule for stem cell transplant, where it has demonstrated improvement in immune cell reconstitution in animal models.

Other indications will then follow.

Also, operationally, in Q4 2010, we expect to complete the renovations of our Fall River, Massachusetts manufacturing facility to increase our production capacity to a 1,000-liter bioreactor, as well as making the facility EMEA compliant.

Implementing EMEA requirements along with US GMPs will allow Celldex to distribute products to clinical sites in both the US and the EU and allow us to expand our development of product candidates to multiple geographic regions.

Finally, we'll continue towards completion of our preclinical work for CDX-1127 in oncology indications.

CDX-1127 is a fully human, monoclonal antibody that targets CD27, a member of the tumor necrosis factor receptor superfamily.

In our presentation at AACR this past April, we demonstrated that targeting CD27 receptors with our fully human antibodies can increase the number of responding T cells and can directly impact tumor cells that express CD27.

This was a critical preclinical proof-of-principle step to support bringing this program into human clinical studies in 2011, where it will add to our growing pipeline of product candidates in our PTI platform.

These accomplishments will position us at year-end with four product candidates in late-stage studies and a rich portfolio of early-stage candidates.

We believe the depth and diversity of our pipeline reflects the potential of Celldex's PTI platform to treat cancer and other difficult-to-treat diseases.

And we look forward to updating you on our progress throughout the year.

Operator, we are now ready for your questions.

(Operator instructions).

Jonathan Aschoff, Brean Murray.

Hi Guys.

Good morning.

Good morning Jonathan.

I was wondering.

You are certain about Pfizer presenting that?

I can understand why you wouldn't have written it in the PR that you put out today.

But just kind of making sure that's as certain as the catalyst that you did write in the press release.

That's the expectation.

Yes.

Okay.

Is Pfizer currently testing 110 in any other indications, do you think?

They have not told us that.

Okay.

And, given-- What will you be giving 301 in combination with - anything?

Well, 301 is a complicated molecule, Jonathan.

It has many interesting effects.

Its most prominent effect really is as a growth factor for both stem cells and dendritic cells.

So we certain see potential there for it simply to increase the number of stem cells in indications where you need that as a single agent.

It can be combined with other growth factors in that setting, such as GCSF or GMCSF, but it will need to be interpolated with the standard of care that's currently being used.

However, it does also have the potential, since it increases dendritic cells, to work in the vaccine setting.

And it can also work in other immune-control indications, where it would be combined with appropriate drug.

So I think there's a possibility for multiple, different combinations down the line.

But we're certainly focused in on the single-agent stem cell factor in transplant as our primary target.

Okay.

Can you guys be any more clear about what you mean by preliminary data for 1401-- maybe patient number, endpoint that you're looking at at this stage?

So, Tom Davis again.

1401 is currently in a Phase 1/2 study.

So we have completed the dose escalation and are planning to be presenting those data, the safety and basic immunogenicity data at different doses of 1401, which is currently being combined with resiquimod, the TLR7/8 agonist.

We may well have some Phase 2 expansion cohort type data, as well, but I can't guarantee that that will be ready in time for SBT.

Okay.

And, just to avoid sort of confusion, the Phase 2b that you would then cross over after placebo -- is it CDX-011-- the primary is going to be PFS, so you don't confound overall survival with the crossover design.

Right?

Well, there's no placebo in that trial.

Oh, of course.

It's versus treatment of physician's choice.

Sorry.

I totally forgot that.

Thanks a lot, guys.

It's a good point, though, Jonathan.

There will be the crossover, which will impact overall survival.

We will look at that.

But it won't be a clean number.

All the patients will have received CDX-011.

On the other hand, however, we will have response data from all 120 patients at the end of the day.

Mark Monane, Needham & Company.

Hi, it's Mark; thanks very much for taking our call and congratulations on your progress.

A couple questions.

The TPI platform now has both conjugated and naked antibodies and maybe you could start off telling us how you choose which antibody for which indication among the platforms.

Hi Mark; this is Tibor Keler.

Hi Tibor.

How are you?

Good.

I think the approach that we take is really to investigate from the targets' perspective what opportunities we have.

And, in fact, many of these targets are targetable by different approaches that include both naked antibodies as well as toxin conjugates, as we've done here.

So in the preclinical data that's developed through the models, the expression pattern, normal versus healthy tissues, and the ability of the target to internalize effectively are all components of making those decisions.

GPNMB, the target for CDX-011, is particularly effective for internalization and for delivering toxins into tumor cells for their killing.

And that was the basis for that decision.

For example, our program around CDX-1127, which targets CD27-- this is a co-stimulatory molecule on T cells and is also expressed on certain tumor cells.

In this setting, we found that a naked antibody could most effectively engage and impact the anti-tumor response.

And, therefore, we're not looking to develop that as a toxin conjugate.

So I think it really will depend on the particular target we're after.

We have all of the different preclinical models to be able to dissect the most appropriate way to develop these clinically.

That was helpful.

And then, specifically looking at the GPNMB program, we saw some data previously that looked quite encouraging.

And now you're going to enter a larger Phase 2b trial.

And I guess maybe Tom or you, Tibor, or Anthony could talk about what kind of numbers-- a little bit about maybe the powering of the trial.

Or, more importantly, what kind of clinical--?

What kind of numbers do you think would be clinically relevant in terms of bringing this forward into a pivotal test?

Clinically relevant, meaning documenting clear, clinical benefit for patients?

Yes.

What kind of response rate or patient outcomes in the 2b might be good enough, in your opinion, a priority, obviously, to make a difference, do you think?

Well, I will ask Dr.

Vahdat to comment when I'm done.

But I think there are no clear guidelines as to what type of response rate or benefit from PFS is considered by the FDA to be clearly approvable.

So, looking at historical precedent, a response rate in the 20% range would probably be considered significant.

And, certainly, if you can exceed that and get to 30%, then that's something that probably would be considered for accelerated approval by the regulatory authorities.

When you look at this trial, this is a trial in heavily pretreated patients.

So the trial will be in patients who have had between two and five prior lines of chemotherapy.

A good analogy to look at is some of the-- is the eribulin trial.

There was one that was just published in the "JCO." The 211 trial just came out on e-Publish.

And then there was the Phase 3 EMBRACE trial, which was just presented at ASCO.

And my guess is that drug will be approved.

But, if you look at the response rates there, the response rates for eribulin were about 12%, and the progression-free survival was a little under 3.5 months.

That trial had a survival benefit.

But those are the kinds of numbers that I think will enable this drug to ultimately be approved.

And it's a very good drug.

And it's a targeted agent.

And it's all about the target.

And this is-- It has particular utility in triple-negative disease, which it seems it does.

There's no difference between this and the PARP inhibitors, frankly, which are highly touted.

That was helpful.

Thanks for the added information.

Steve Brozak, WBB Securities.

Congratulations with all the programs.

But there's one item that basically a lot of people fail to understand.

And you're talking about the patients that you're dealing with, in some cases, have multiple treatments prior to your dealing with them and, also, multiple side effects.

Can you give us a profile as to--?

Obviously, the disease-free progression is a significant factor in evaluation.

But there's also a quality of life difference in terms of what you're dealing with in terms of your reagent product versus the current standard of care.

And I'd like some-- I'll use the word granularity to describe that, because there's a big difference.

Can you go into that in some kind of detail in terms of what you would expect the most significant differences you would see would be?

Well, I can talk about the breast cancer trial, having used the drug extensively over the past couple years.

CDX-011 is actually fairly well tolerated.

It causes a little bit of rash in some patients.

For most patients, rash is not a big deal.

The most significant side effect that you always have to worry about when you treat breast cancer patients is the issue of neuropathy, which is numbness and tingling in the fingers and toes, because a lot of the drugs that we use can cause that.

And, as you go from one treatment to the other, that can get worse.

And that can decrease quality of life.

This drug only really causes a little bit of neuropathy.

So that is, I would say, an advantage to the drug itself.

So, out of all the drugs that are out there that we use for stage four breast cancer, and there are many drugs-- I mean well over 10-- at a minimum, 10 to 15 drugs are used.

This one would sort of be on the spectrum of low side effect-- low on the bad side effect profile.

And, looking at what, for instance, one of the other competing companies, Dendreon, has basically espoused in terms of how they've said - Well, look, you know, we are showing better "patient outcomes," but the quality of life is completely different in terms of the treatment protocols.

And I want to emphasize-- The way we've interpreted it is that your platform would allow for that better quality of life across the board in terms of all treatment protocols.

Is that a fair assessment?

Right.

I do think that's a fair assessment.

We certainly believe that the immunotherapies we're developing are less likely to cause toxicity.

The one exception, of course, is the ADC, which does have a toxin on it.

As you've just heard from Linda, it does cause some side effects.

But the fact that you can target it with antibodies, we believe, will reduce the amount of toxicities in normal tissues.

I do hope that there is a general trend in all of cancer research to develop drugs that have less toxicity to support that quality of life you were describing.

But the thing that you always need to remember is that the worst thing for quality of life is uncontrolled cancer.

And that's where the real balance is.

So you have a drug that's effective.

People, patients, as well as physicians, are usually willing to live with a little bit of toxicity.

Yeah.

But, I mean, the reality is a lot of the drugs that we use today basically have been backed into in terms of levels of treatment by-- You go back and you say that, at this level, it's highly toxic, and you back in from there to see where it's just only marginally toxic.

You're talking about a targeted approach that would clearly give you superiority, even if the numbers were only marginally better.

And that's one of the things that I think a lot of people fail to understand in this new category of drugs.

We certainly agree with you.

We appreciate that.

Thanks.

Good.

Well, I look forward to being able to write about future progress.

Congratulations again.

Edward Kenna; Access Securities.

Good morning and thank you for taking my question.

Good morning.

Your antibody-based vaccine platform should be useful in infectious disease indications as well as to treat cancer.

Can you give us an update on any ongoing or planned activities in that space?

Yes.

This is Tibor Keler again.

We have also programs initiated in the infectious disease space.

We've been working, as we've discussed before, with Rockefeller University around an HIV vaccine that's also based on this same technology platform.

And we've recently been working with them to initiate a Phase 1 trial.

So that is the first infectious disease vaccine we're developing in the context of the antibody vaccines.

And we're also in discussions about other programs with collaborators that have infectious disease expertise.

Oh.

Thank you very much.

That was helpful.

There are no more questions.

I would now like to turn the call over to Mr.

Marucci for closing comments.

Thank you, Operator.

And thank you, all, for joining us today.

As you have heard Celldex has made considerable positive progress advancing our clinical pipeline.

ASCO 2010 was an important event for us, and we were able to present positive data from three of our four clinical programs.

We will maintain this momentum in the second half of the year and look forward to updating you further on our clinical and operational progress throughout the remainder of 2010.

I thank you once again for your time this morning, and have a good day.

This concludes our call today.

You may disconnect.