Fate Therapeutics Inc (FATE) 2015 Q1 法說會逐字稿

Welcome to Fate Therapeutics' first-quarter 2015 financial results conference call. At this time, all participants are in a listen-only mode. This call is being webcast live on the Investor and Media section of Fate's website at fatetherapeutics.com. This call is the property of Fate Therapeutics, and recordings, reproduction or transmission of this call without the express written consent of Fate is strictly prohibited. As a reminder, today's call is being recorded.

I would now like to introduce Scott Wolchko, Chief Operating and Financial Officer of Fate Therapeutics.

Thank you. Good afternoon, and thanks, everyone, for joining us for the Fate Therapeutics first-quarter 2015 earnings call. At 4 p.m. Eastern time today, we issued a press release with our first-quarter 2015 financial results, which can be found on the Investors and Media section of our website under Press Releases. In addition, our first-quarter 2015 10-Q was filed shortly thereafter, and can be found on the Investors and Media section of our website under Financial Information.

Before we begin, I would like to remind everyone that, except for statements of historical facts, the statements made by management and responses to questions on this conference call are forward-looking statements under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that can cause actual results to differ materially from those in such forward-looking statements.

Please see the forward-looking statement disclaimer on the Company's earnings press release issued after the close of market today, as well as the Risk Factors in the Company's SEC filings included in our Form 10-Q for the quarter ended March 31, 2015 that was filed with the SEC today. Undue reliance should not be placed on forward-looking statements, which speak only as of the date they are made, as the facts and circumstances underlying these forward-looking statements may change. Except as required by law, Fate Therapeutics disclaims any obligations to update these forward-looking statements to reflect future information, events, or circumstances.

Joining me on the call today is Dr. Christian Weyer, President and Chief Executive Officer. I will begin the call by reviewing our financial results for the first quarter of 2015. Christian will then provide a general corporate update and discuss some of the recent progress with our ProHema clinical program. And then I will provide a brief overview of our newly-formed strategic collaboration with Juno Therapeutics. We will then open the line to questions.

For the three months ended March 31, 2015, Fate Therapeutics reported a net loss of $7.9 million as compared to a net loss of $7 million for the first quarter of 2014. Research and development expenses for the first quarter of 2015 were $4.6 million compared to $4.5 million for the first quarter of 2014. This increase is primarily related to additional headcount and costs associated with the Company's conduct of its Phase II PUMA clinical trial of ProHema, offset by a $400,000 charge during the first quarter of 2014 related to the achievement of a preclinical milestone pursuant to our April 2010 asset acquisition agreement with Verio Therapeutics.

General and administrative expenses for the first quarter of 2015 were $2.8 million compared to $2.4 million for the first quarter of 2014. This increase is largely due to incremental expenses across the Company's operations. Total operating expenses for the first quarter of 2015 were $7.3 million compared to $6.9 million for the first quarter of 2014. After adjusting for stock-based compensation expense of approximately $600,000, total operating expenses for the first quarter of 2015 were $6.7 million.

At the end of the first quarter of 2015, our cash and cash equivalents were $42.3 million. Our debt outstanding under our facility with Silicon Valley Bank was $20 million, and we had approximately 20.6 million shares outstanding. Cash and cash equivalents as of March 31, 2015 did not include $13 million in payments and proceeds in connection with entering into our strategic research collaboration and license agreement with Juno Therapeutics.

I will now turn the call over to Christian to provide a general corporate update, including an update on our clinical activities.

Thank you, Scott. And good afternoon, everyone. Since our founding, we have been pioneering a novel therapeutic approach to cell therapy that allows us to program the function and optimize the therapeutic potential of hematopoietic cells. We believe that our cell programming platform holds tremendous potential, and we are applying it to develop a robust pipeline of first-in-class programmed cellular therapeutics for the treatment of severe life-threatening diseases.

On our last earnings call, we discussed the significant progress we had made in 2014 to demonstrate the therapeutic potential and broad applicability of our cell programming platform. This included the identification of modulators to program the therapeutic properties of T cells, the use of modulators in combinatorial fashion, and the application of modulators to enhance multiple therapeutically relevant pathways.

We reviewed our development stage programs, ProHema and ProTmune, which represent first-in-kind program cellular therapeutics derived from cord blood and mobilized peripheral blood, respectively, that have the potential to improve outcomes in patients undergoing allogeneic hematopoietic stem cell transplantation, or HSCT, and that address approximately 80% of the steadily growing and concentrated market.

We also highlighted progress on key research stage programs that are aimed at expanding our therapeutic franchise beyond the transplant setting, including our PD-L1 programmed HSC candidate. And we pointed to the significant opportunities that exist for value-creation through strategic partnerships.

On today's call, we are pleased to discuss several recent corporate highlights that clearly exemplify and underscore the broad therapeutic potential of our cell programming platform. First off, we announced just yesterday that we have entered into a broad strategic alliance with Juno Therapeutics that will enable the application of our programming platform to the exciting area of cellular immuno-oncology.

We are thrilled to partner with Juno, a leader in the field, and a company that shares our deep commitment to developing transformative cellular therapeutics for patients afflicted with life-threatening disorders. And as Scott will review with you later on in the call, this deal provides significant opportunity for us, both economically and with respect to the expansion of our therapeutic pipeline.

Second, we also just yesterday disclosed additional data from our ongoing Phase II PUMA study of ProHema that we believe further underscore the broad therapeutic potential of our platform, providing further support that the programming of hematopoietic stem cells and T cells may beneficially impact multiple clinically important endpoints.

Let me take a few moments to elaborate on those recent clinical observations. As you will recall, the PUMA study is an ongoing randomized open-label Phase II clinical trial of ProHema in adult subjects undergoing double umbilical cord blood transplantation for the treatment of hematologic malignancies. The PUMA study is designed to enroll approximately 60 subjects, randomized at a ratio of 2-to-1, with approximately 40 subjects intended to receive ProHema, the ProHema cohort, and approximately 20 subjects intended to receive two unmanipulated cord blood units, the concurrent control cord.

And because we are programming multiple hematopoietic cell types contained within a cord blood unit, our PUMA study assesses multiple exploratory clinical endpoints that are relevant to informing and supporting potential registrational strategies. These include key measures of hematopoietic reconstitution and the immunotherapeutic potential of ProHema, including time to an incidence of neutrophil engraftment, bacterial infections, viral reactivation, graft with the host disease, and overall in disease-free survival.

In late December 2014, we reported favorable neutrophil and graft material from an interim safety review of the first 12 subjects administered ProHema in our ongoing Phase II PUMA study. At that time, the study's independent Data Monitoring Committee determined that ProHema had met established safety criteria and supported continuation of the study.

The clinical update that we provided yesterday expands upon this early update in several ways. It included data from 18 subjects in the ProHema cohort and 12 subjects in the concurrent control cohort. Analysis of the currently available data continued to show that subject administered ProHema had both an increased incidence of early neutrophil engraftment and a reduction in median time of neutrophil engraftment, as compared to applicable historic control values, as well as to subjects in the current control cohort.

Specifically, of the 14 subjects administered ProHema that achieved neutrophil engraftment, 64% engrafted prior to both the applicable historical control median and the applicable median of the concurrent control cohort. Additionally, engrafting subject administered ProHema had a six-day reduction and a five-day reduction in median time of neutrophil engraftment, as compared to the applicable historic and concurrent control medians, respectively.

As discussed previously, engraftment of donor-derived neutrophils is one of the most crucial early outcomes required for the successful reconstitution of a new blood and immune system. And it is well-established that patients who achieve early neutrophil engraftment have a several-fold lower risk of transplant-related mortality than those with delayed neutrophil engraftment. Expanding upon the aforementioned observations, analysis of the currently available data also showed that ProHema treatment was associated with a reduced incidence of CMV reactivation.

Specifically, among subjects who tested sero-positive for CMV at baseline, CMV reactivation was observed in 64% of subjects administered ProHema as compared to 100% of concurrent control subjects. Additionally, among CMV sero-positive subjects who had reached at least 100 days post-transplant, 14% of tests were positive for CMV reactivation in subject-administered ProHema as compared to 23% of tests in the concurrent control cord. And while there were four adverse events of CMV infection among the 12 concurrent control subjects, there has been no adverse event of CMV infection reported in any of the 18 subjects administered ProHema.

These interim observations on CMV reactivation are not worthy for several reasons. First, they are generally consistent with the low rates of CMV reactivation initially observed in our Phase Ib study of ProHema, and as such, provide further supporting evidence that our cell programming approach may have clinically meaningful effects on the T cell compartment, such as enhanced protective immunity against viral infections.

Recall that many adults, including patients requiring transplant, have experienced a CMV infection at some point in life and still harbor the cytomegalovirus. These patients test zero positive for CMV at baseline and at a very high risk of CMV reactivation post-transplantation when their T cell-mediated protective immunity is compromised. In fact, published literature indicate that up to 100% of patients undergoing umbilical cord blood transplantation for hematologic malignancy, experience CMV reactivation, and with the majority of patients reactivating within the first 50 days.

Lack of CMV reactivation, as observed in the currently available PUMA clinical trial data, suggest that donor-derived T cells are able to provide sufficient protective immunity to prevent the latent cytomegalovirus from exacerbating. And second, CMV reactivation can lead to severe, sometimes fatal CMV infections and disease, contributing to transplant-related morbidity and mortality.

Preemptive treatment with antiviral therapies of patients who experience CMV reactivation is therefore considered standard of care, yet such treatment comes with significant risk of toxicity, prolonged hospitalization of up to 14 days, and significant incremental cost of up to $74,000 based on literature reports. Primary prevention of CMV reactivation is therefore a clinically and economically highly desirable outcome.

Lastly, based on our analysis of the currently available data, subject-administered ProHema also had a reduced incidence and rate of infection-related adverse events as compared to the concurrent control cohort. Specifically, 56% of subject-administered ProHema experienced at least one infection-related adverse event with a rate of 1.3 per subject. By comparison, 67% of concurrent control subjects experienced at least one infection-related adverse event with a rate of 2.4 per subject. And the available data indicate that the lower incidence of infection-related adverse events overall was attributable to lower rates of both viral and bacterial infections.

Needless to say, we are very encouraged by these interim observations and are highly focused on working with the 11 active study sites to complete enrollment in the study as expeditiously as possible. We believe these interim observations also bode well for our development of ProTmune, our ex-vivo program cellular candidate for patients undergoing HSCT using mobilized peripheral blood, which is used as the cell source today in approximately 65% of allogeneic HSCT procedures. We expect to file an IND by the end of 2015 to initiate clinical development of ProTmune.

And finally, in addition to this important progress for our Phase II PUMA study in adults, I'm also pleased to announce that the first subject has been treated in our pediatric Phase Ib PROMPT study. Our PROMPT study is designed to evaluate ProHema in up to 18 pediatric subjects undergoing cord blood transplantation for the treatment of various hematologic malignancies. We are in the process of activating several additional sites for the study, and expect to report clinical data in the second half of this year.

And with that, I will turn it back -- the call back to Scott to talk about our newly-formed strategic alliance with Juno Therapeutics.

Thank you, Christian. To expand on our introductory remarks, since our founding, we have identified and applied small molecule modulators to hematopoietic cells ex vivo to program the biological function of cells prior to their administration to a patient. Our ex vivo cell program approach is designed to induce rapid and super-physiologic activation or inhibition of therapeutically-relevant genes and cell surface proteins, such as those involved in the homing, proliferation and survival of C34 cells, or those involved in the persistence, proliferation, and reactivity of T cells.

We believe ex vivo cell programming can potentiate the biological activity of cells, and can have profound effects on the therapeutic properties of cells in vivo upon their administration to a patient. On May 4, 2015, we entered into a research collaboration and license agreement with Juno Therapeutics, a leading biopharmaceutical company focused on re-engaging the body's immune system to revolutionize the treatment of cancer, to identify and apply small molecule modulators for programming genetically-engineered CAR T cell and T cell receptor immunotherapies.

Pursuant to the terms of the agreement, Juno has agreed to pay the Company an upfront fee of $5 million, and agreed to purchase 1 million shares of the Company's common stock at $8.00 per share for an aggregate purchase price of $8 million. Under the collaboration, Juno has agreed to fund all collaboration activities during an initial four-year research term. Additionally, Juno has the option to extend the initial research term for an additional two years, subject to the payment of an extension fee and the continued funding of all collaboration activities.

If Juno exercises its option to extend the initial four-year research term, we have the option to sell and to cause Juno to purchase up to $10 million in additional shares of Fate common stock at 120% of the volume weighted average trading price for the 30 trading days prior to Juno's exercise of its extension option. For each CAR-T and TCR immunotherapy that is developed by Juno, which incorporates modulators identified through the collaboration, we are eligible to receive approximately $50 million in target selection fees, and clinical regulatory and commercial milestones, plus low-single-digit royalties on net sales.

In striking this collaboration, we have brought together Juno's scientific and clinical leadership in CAR-T and TCR immunotherapy, and our expertise in hematopoietic cell biology, and in the program -- and in programming the biological function of hematopoietic cells. We expect to focus our efforts under the collaboration on identifying and applying small molecule modulators to immunological cells ex vivo, and on interrogating the effects of modulation on the in vivo biological activity and therapeutic potential of T cells.

For example, we may look to identify and apply small molecule modulators ex vivo to promote T cell homing to tumor sites, to increase T cell persistence, to decrease T cell sensitivity to suppressive factors in the tumor microenvironment, or to skew the T cell compartment to a memory-like state, all in an effort to augment the therapeutic potential of CAR-T and TCR immunotherapies. Juno is responsible for the development and commercialization of genetically-engineered T cell immunotherapies incorporating small molecule modulators.

We believe that partnering with the leader in CAR-T and TCR immunotherapy significantly strengthens and broadens our cell programming platform. Importantly, we have retained exclusive rights to our intellectual property, including our intellectual property arising under the agreement, for all purposes outside of tumor-associated antigen target selected by Juno under the collaboration. We believe the collaboration with Juno will provide us significant scientific leverage, and affords us the opportunity to apply our small molecule modulators to our own pipeline of disease-transforming hematopoietic cellular candidates.

As is exemplified through our Juno collaboration, we continue to see tremendous opportunity for convergence of genetic engineering and our ex vivo cell programming approach for the development of transformational best-in-class cellular therapeutics. While significant advancements have been made to safely and efficiently engineer hematopoietic stem cells and T cells, and certain genetically engineered therapeutic candidates have demonstrated very encouraging initial clinical results in the setting of hematologic malignancies, and genetic disorders, we believe the biological activity and the therapeutic properties of hematopoietic cells can be optimized through ex vivo programming.

We will therefore continue to look to partner with industry leaders like Juno Therapeutics for opportunities to potentiate the biological activity and maximize the therapeutic properties of cellular therapeutics prior to their administration to patients.

And with that, I'd like to turn the call over to the operator for any questions.

(Operator Instructions) David Nierengarten, Wedbush Securities.

Thanks for taking my question. So, forgive me if I missed it, but you mentioned the cost savings associated with preventing -- or a patient not having CMV reactivation. Did you mention the hospital day costs? Because presumably, you would be being discharged early or the patients would be discharged earlier than the comparison group.

Yes, hi, David. This is Christian speaking. Happy to clarify this. So based on what's published in the literature, which was an analysis from the Hematology branch of NIH, preemptive therapy of patients who actually have reactivated CMB, the overall incremental cost has been estimated in cord blood transplant patients to be up to $74,000. And that is really a combination of the cost of the antiviral therapy itself as well as the prolonged hospitalization.

In this specific paper, the extension of the hospital stay associated with preemptive therapy for viral CMV reactivation was between 12 and 14 days. And so, increased hospitalization is clearly one of the major contributors to this overall increase in cost per patient care.

Got you. And then one other question. The Phase III trial is powered to show, if I recall correctly, 70% of patients engrafting before the median time, correct?

That is correct.

And in the interim observation, you had 64% engrafting early?

Yes, that is correct.

Yes. Does not -- I mean, if that were to carry forward, I suppose the question is, would you meet your primary endpoint? Or is there other statistics to -- analysis --?

And no, absolutely. I'm happy to comment on this. So the powering assumed is 70%. It's an 80% power, so this does not preclude that we would hit significant results, even with a proportion of patients sort of slightly below that, especially when you take into consideration that there is other neutrophil engraftment-related outcomes that are really critical.

And in addition to the effects of ProHema on neutrophil engraftment, we obviously also will carefully look at a whole host of additional secondary endpoints, such as CMV reactivation. And then, lastly, as I think we had discussed previously in one of our calls, the study is powered as a categorical endpoint is really critical when you look at these trials to look at the overall distribution and shape of the curve, and look at the entire data set in that regard.

Okay, great. Yes, I wanted to just doublecheck on that. Thanks.

Sure.

Reni Benjamin, H.C. Wainwright.

Good afternoon, guys, and thanks for taking the questions. I guess just to go back to this engraftment rate question -- and I apologize if you said this during the prepared remarks -- but can we talk about the 14 out of 18 that are engrafting versus the 11 out of 12 in the control arm? What -- is there anything in particular that's leading to that kind of discrepancy that might be more patient-specific rather than therapeutic-specific?

Yes, absolutely. So, as you might recall, we did provide an update on the clinical data back in December 2014, after the IDMC's second preplanned interim review. And at that point, we had nine out of 12 ProHema patients in graft. Two of the patients actually experienced early mortality prior to engraftment. And those cases were both attributed to the toxicity of the conditioning regimen.

And so when you step back and think about the patient population that we are studying here and the intensity of the actual intervention, I mean, these are very sick patients. They undergo a very harsh conditioning regimen, especially with mild ablative conditioning regimen. And so, clearly, there are going to be instances where patients succumb just to the intensity of the conditioning regimen and never actually stand a chance to achieve neutrophil engraftment. And we did have two of those cases in the ProHema cohort.

Okay. Okay. And so if you actually take out those two, I assume you are well north of -- you are probably closer to 80% -- 90% engraftment --?

Yes. So then you are talking about 14 out of 16 patients when you take this into account. And then when you actually start the other thing I think that's important to consider is, the number of patients or the rate of patients who actually failed to engraft is well within the sort of what is expected in the double umbilical cord blood setting in adults. And you can go through the literature.

And I mean, again, many of these patients have inferior or sort of fatal outcomes for a whole host of reasons. So yes, absolutely. The 14% out of 16% of patients actually that did not experience early mortality engrafted, and then overall the adverse events that we are seeing we believe are very consistent with what has been reported in this setting.

Okay. And just kind of related to that, we were expecting -- I guess, in our milestone chart -- data to come out maybe a little bit later to the middle of the year. Kind of a question as to what prompted the data analysis now? And when would we see the final data for the complete trial?

Yes. No, absolutely. So we felt it important to actually share some of -- especially in light of some of the additional observations beyond the neutrophil engraftment to provide an update on the study pretty much at midpoint with 30 -- data from 30 patients that are available. And as we have previously guided, we are moving aggressively ahead and completing enrollment of this study, and with a target date of having data on the entire study by the end of this year.

Okay, okay. Just switching gears real quick to the CAR-T collaboration, I know that Scott mentioned that, look, you can look at T cell -- you are hoping to modulate or improve T-cell persistence, honing, and the like. But the last time that we had a conference call, we were talking more about immuno-oncology checkpoint inhibitor expression on T cells.

And so do we have data already looking or showing that T cell honing is improved? Or is the collaboration right now going to establish these various points?

Yes. No, thanks, Reni. I mean, great question. So, I mean, first off, I mean we're not yet prepared to discuss actual sort of specifics on exactly the type of modulators we would be actually -- and targets we would actually go after to improve the properties of CAR-T and TCRs.

The checkpoint inhibitor pathway that we had previously talked about in our earnings call, actually that was actually pertaining to our preclinical CD34 cell therapy where we upregulate in a very profound way cell surface expression of PD-L1, with the goal of mitigating an alloreactive T cells. So, in essence, we were using the well-established and clinically-validated PD-L1 PD-1 pathway in reverse sort of fashion to the checkpoint inhibitors.

That is really distinct and different from the type of modulation that we would be seeking to apply to genetically engineered T-cell immunotherapies. We have, as we had also shared previously, we have seen that especially combinations of existing small molecules can have pretty profound effects on T cells. And I would point you to the preclinical data we presented at ASH last year with our ProTmune mobilized peripheral blood program where some of this was seen.

Okay. And these modulators that you'll be testing, they are already part of your master bank, I'm assuming? You are not necessarily going out and creating new ones. Is that correct?

No, I mean, we have spent years obviously sort of setting up a platform and our screening capabilities are ready to go.

Got it. Just related to this, you also have, of course, the iPSC franchise and a lot of talk as to how iPSCs could potentially be used in the T cell platform. Is Juno at all interested in that? Or does this collaboration just restrict it to the modulators?

So the collaboration that we announced yesterday is strictly confined to improving or programming the function of genetically engineered T cells. It does not iPSC derivation of T cells. That is separate, and it is something that we are very excited about as well. And as we have previously disclosed and discussed, we firmly believe that there is a tremendous opportunity in the future of hematopoietic cell therapy to apply iPSC reprogramming technology because that really enables entirely new projects and avenues for both genetic engineering and cost-effective manufacturing of these cells.

Many of these cells in the hematopoietic space, such as in K cells, tumor infiltrating leukocytes or the like, some of the key limitations are that these are very rare cell populations. And the manufacturing and expansion of these cells without unintended consequences, such as exhaustion, is really a very big unmet medical need.

And so we are keenly interested and are applying our iPSC platform to derive therapeutically-relevant and developable versions of hematopoietic cellular therapeutics. That is separate from the announcement, the strategic alliance we announced yesterday with Juno Therapeutics.

Okay. And just one last question. Can you just give us an update -- I may have missed this -- on PROVIDE, the PROVIDE study?

Yes, sure. We did not specifically comment on this in our prepared remarks, but I'm happy to say we are making very significant progress there as well, and activating the sites currently at several centers, and already actually have IRB approval to treat our first patient. So, stay tuned on this. We should be able to provide an update on this study shortly.

Terrific. Thanks for taking the questions and good luck.

Of course. Thank you.

Jim Birchenough, BMO.

Thanks for taking my question and very good progress. I'm particularly interested -- I should say this is Nick in for Jim. Sorry, it's been a busy day. I'm very interested in the infection data. I find that very striking. And I'm wondering if perhaps you can comment on the severity of the infections, pathogens, whether they were bacterial or fungal, or even other viruses, and then responses to treatment?

And that leads me on to a broader question of -- are you looking at changes in innate and adaptive immunity, and changes in T cell repertoire, for example, that are occurring in this 100 days post-transplant? And then I have a follow-up. Thank you.

Absolutely. Thanks for your question, Nick. So, first off, I mean, we completely agree. I mean, I think infection-related mortality and serious infections are obviously -- whether viral, fungal, or bacterial, obviously are a major problem for many patients. And so we are obviously very encouraged and excited to see these trends and from an adverse event reporting perspective.

We are collecting these adverse events that are serious in nature. So we are talking about serious infections. And when we actually looked at the data, there is a fairly broad type sort of sample of infections, various types of bacterial infections, various types of viral infections and fungal infections that would be expected in the transplant setting.

With respect to the actual mechanisms that might contribute to this, I mean, some of those might obviously be related to the effect that we might be having on T cells. But I think it's also important to recognize, for instance, that hematopoietic stem cells have the ability, for instance, to home to the inner lining of the gut, and perhaps provide sort of repair of the damaged gastrointestinal mucosa.

So there's a lot of potential mechanisms that could be applied to actually or sort of implicated in explaining these initial observations. We're going to have to look at this. We are, in the PUMA study, continually and thoroughly looking at the T cell compartment. And so we will be doing additional analyses of temporal changes to the T cell compartment and in ProHema-treated patients.

Thank you. And then the follow-up is just back to the CAR-T study. I understand that for TCR and CAR-T, then they deal with Juno that that's exclusive for a T cell. What about for the iPSC-derived T cell? Is that a different T cell? I mean do you have freedom to develop a TCR or CAR-T based iPSC T cell independently of the Juno collaboration that uses the same small molecules?

Yes, absolutely. Again, I mean, the potential of iPSCs in the future of genetically engineered cancer immunotherapy, we believe, is bright. You know, there is, as I said, a whole host of unmet medical needs that are potentially addressable with iPSC technology. And as I said, we are quite excited about this.

There is actually scientific papers published in the literature that really speak to the potential of convergence, to Scott's earlier point, of genetic engineering, such as CAR-T engineering and iPSC reprogramming technology. So this is clearly an area that is recognized as having a lot of potential.

But to be very clear, the deal that was announced yesterday with Juno does not entail iPSC-derived T cells, including genetically engineered T cells. So to answer your question, we are absolutely able to pursue this ourselves at this point.

Great. Thank you very much and congrats on the progress.

Thanks, Nick.

(Operator Instructions) David Nierengarten, Wedbush Securities.

David?

Oh, I'm sorry. There's a mute button on my phone. (laughter) Any way, thanks for taking the follow-up question. It's been a long day, to echo a previous sentiment. In terms of the economic -- potential economic benefits for ProHema, outside of a CMV case, and then just looking straight at time to engraftment six days earlier than median, what kind of cost savings does that entail for the transplant?

Yes, so I'm glad you have the points. As I said, I mean, the CMB preemptive treatment cost in and of themselves are already very, very significant, of course. And, of course, in addition to that, there is additional potential for a pharmacokinetic benefit, just with the effect on neutrophil engraftment.

So if, as an example, we saw, at the end of this study, a continued six-day acceleration of neutrophil engraftment, that in and of itself will quickly get you into a pharmaco-economic potential saving in that same ballpark of about $75,000. And it depends a little bit on who you speak to and what sort of transplant centers.

But by our sort of intelligence, the days and per-day in the hospital after a cord blood transplant can range anywhere from $15,000. And that number could potentially be even higher the more complications you actually have.

Yes --

So it's the patients who actually undergo cord blood transplant and get out of the hospital quickly without complications have obviously far lower cost. So, a six-day acceleration of engraftment could easily be in the ballpark of $75,000 a day as well, depending on complications and the intensity of treatment, including, obviously, days in the intensive care unit.

Yes, I know it's hard to tease apart the effect of a quote -- kind of an uncomplicated transplant where you are released early versus the other reasons why you might be released later (multiple speakers) --.

Yes, exactly to your point. You are dealing with efforts, costs and not all days in the hospital are equal, obviously.

Yes. Great. That's a good -- thanks for the ballpark figure, though. That's helpful. Thank you.

Of course.

And there are no further questions in the queue. I would now like to turn the call over to Christian Weyer, President and Chief Executive Officer, for closing remarks.

Well, thank you very much. I think it's all apparent this is a very exciting time for us. We have made, we believe, great progress throughout the year so far. So, thank you very much for your participation in today's call. And, as always, we look forward to updating you again in the near future. Thank you.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude today's program. Everyone have a great day.