Geron Corp (GERN) 2010 Q1 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the First Quarter 2010 Geron Earnings Conference Call. My name is Carissa, and I will be your coordinator for today. At this time, all participants are in a listen-only mode. We will be facilitating a question-and-answer session towards the end of today's conference. (Operator Instructions).

I would now like to turn the presentation over to your host for today's call, Mr. David Greenwood, Executive Vice President and Chief Financial Officer. Please proceed.

Good morning and welcome to the Geron earnings call. I am David Greenwood. With me is Tom Okarma.

This is an earnings-related conference call, and we will begin with a summary of operating results for the first quarter. Our agenda then includes an overview of recent operating highlights of the Company and a look forward with our program development plans for 2010. Following that presentation by Tom, we will have a general Q&A session.

First, two informational items. In the event of forward-looking statements during this call, please understand that comments are made subject to the Safe Harbor provisions of the Securities and Litigation Reform Act. Any forward-looking statement involves uncertainty, and we refer you to the risk factors detailed in our filings with the SEC.

Secondly, all participations are currently in listen-only mode and the lines will open for the Q&A. And this call is available for a webcast replay until the end of May on the Geron website.

Revenues for the three months period attributable to collaborative agreements, royalties and interest license fee income amounted to approximately $900,000, which is an increase over the 2009 period. We expect this number to total about $3 million for the year. Other cash inflows to the Company during the quarter included $200,000 of interest income on the marketable securities portfolio.

Quarterly R&D expense was flat period-to-period, but that is not to suggest that R&D expense will be flat for the year. R&D expense for the year will increase to begin funding of four Phase II trials with our telomerase inhibitor. We are not adding numbers of FTEs. These are external costs for drug product, contract research organizations, trial sites.

The G&A line item did increase. That's attributable primarily to a higher patent legal costs, principally the Novocell interference that we filed.

We ended the quarter with $167 million cash on the balance sheet. Our net burn last year was $43 million. Our burn in 2010 will be higher, perhaps $50 million, driven by the cost of the oncology trials, preparation for re-initiation of the spinal cord injury trial with our OPC1 cell therapy, and large animal studies in the cardio and chondrocyte programs, the former a safety study [in foreseen] and the latter a sheath efficacy study.

There were no issues with the quarterly review by E&Y, and our investment portfolio remains unimpacted by the continuing uncertainty in the markets.

At this point, I will turn it over to Tom.

Thank you, David, and good morning everyone. Thank you all for dialing in today.

Let me first turn to a busy presentation schedule in the first quarter, at least for me. I gave seven presentations in the quarter, starting with the JPMorgan Healthcare Conference in San Francisco, followed by the BIO CEO Conference in New York. I also gave a plenary talk at the World Congress on Stem Cells in San Francisco on the 20th of January. I went to London and gave a plenary on the SMi Stem Cell Conference in mid-February and on the 16th gave a featured presentation on the stem cell program at the London Regenerative Medicine Network Conference. We went to Tokyo at the end of February and I had presented at the Drugs and Biological Conference, and lastly a featured presentation in Boston on the 24th of March at the Cambridge Cancer Stem Cell Conference.

Turning now to Board composition, on the 26th of March, we announced the appointment of Thomas Hofstaetter to Geron's Board of Directors, coincident with the retirement of Pat Zenner. Thomas will also serve on the Board's Compensation Committee. It goes without saying how much we have benefited from Pat's nine years of service on our Board. His 40 years of pharmaceutical and biotech experience provided us with valuable commercial insight and counsel. We're also obviously very pleased to welcome Thomas to our Board. He brings more than 30 years of pharmaceutical experience from a range of senior executive positions in research and development, strategy and corporate development.

Let me turn now to the regenerative medicine side of the company. At the end of January this year, we announced a collaboration to study our OPC1 product in models of Alzheimer's disease. This work will take place in the laboratory of Professor Frank LaFerla at UC Irvine. The project was awarded to UC Discovery Research and Training Grant.

Now this is one of several line extension opportunities that we are exploring for OPC1, our glial progenitor cell therapy for acute spinal cord injury. Other possible line extensions include stroke and multiple sclerosis, and there are collaborations ongoing in those two potential applications.

The Alzheimer's collaboration is based on published work published last year in August in PNAS from the LaFerla lab that showed significant improvements in memory and neuropathologic changes in a triple-transgene mouse model of Alzheimer's disease after the injection of live murine neural stem cells. In addition to dramatically improved memory, the animals showed significant increases in the neural synaptic density in the basal ganglia. At sacrifice, nearly all of the transplanted cells that were prevalent in the mouse brains were glial cells. There were very few new neurons.

Moreover, the memory improvement and increases in synaptic density were observed after injections of the neurotrophin BDNF, which is known to be secreted in physiological concentrations from our GRN OPC1 cells, along with many other neurotrophins. The significance of the work is that the cells restored mental function and synaptic density in the presence of plaques and tangles, which in man accumulate for decades before cognitive dysfunction occurs.

So this is the first potential therapy, which has demonstrated functional and histologic improvement in the presence of these plaques and tangles, a very important fact given the prevalence of the disease in man. So the collaboration will test the OPC1 injections directly into the brains of the Alzheimer's mouse model to determine the effects of our cells on memory, learning and the histopathology of the disease.

On the 3rd of March, Geron and Corning announced the product launch of the Synthemax Surface for scalable growth and differentiation of human embryonic stem cells. This product launch is the result of five years of collaborative research by Geron and Corning. The Synthemax Surface contains a synthetic peptide that enables the scalable expansion and differentiation of embryonic stem cells without the use of feeder cells or any other biological material on the polystyrene surface.

So this development eliminates the costs and variability and expensive QC testing that was previously required for hESC cultures. Importantly, the surface can be fabricated into beads, which will enable the large scale expansion and differentiation of hESCs and their differentiative cellular products in various types of bioreactors. Geron receives a royalty on product sales, and perhaps more importantly, we have exclusive rights to use the surface in the manufacturing of our therapeutic products, including cardiomyocytes, islets for diabetes, and all neural cells. The sterilized 6-well plate format is currently available in North America, and we expect this product to become the gold standard surface in hESC culture.

A word about our relationship with GE Healthcare. The GE deal was initiated in June of last year, and the goal was of course to commercialize embryonic stem cell-derived cells for drug discovery applications. Under the collaboration, Geron is providing the biology, and GE will manufacture and commercialize the products, the first of which will of course be cardiomyocytes for drug testing.

The tech transfer of the cardiomyocyte production process from Geron to GE was successfully achieved at the end of last year. And GE is now doing extensive data testing to validate the performance of the product manufactured in its UK facility, with a select group of pharmaceutical partners.

As you know, GE is a very aggressive company managed by the numbers, and their strategy is to launch this product with the demonstration in the hands of the former beta testers of the utility of this product.

So we expect the product to be launched early in the second half of this year with a fanfare that will include the demonstration of its utility by a handful of the customers we expect to purchase the product. And of course, Geron receives both product launch milestones and royalties on sales.

Let me next turn to a comment on the OPC1 IND. As stated in our last earnings call, we cannot discuss the specifics of our submission to reinitiate the spinal cord trial, until the FDA reviews all the data and we have a final decision.

However, I can say that we are right on track for trial re-initiation in the third quarter of this year as we had predicted before. And we are frankly more confident than ever that we will achieve that outcome.

I'd also like to make some comments on our very recent development that occurred yesterday, regarding one of the WARF patents. Surprisingly, the Board of Patent Appeals and Interferences of the US Patent Office has reversed an earlier decision in the reexamination of one of the three WARF patents licensed to Geron.

So although we've not yet had a chance to study the decision in detail, and so I won't comment substantively on the decision, I will say it's a surprise given the extensive documentation that had supported their earlier decision to uphold the validity in the prior challenge. The opinion was an 80-page, very technical document. We at Geron have always believed the patents to be valid, and we will assist WARF in their continued prosecution of the claims.

However, it's important to note that this decision has no impact on Gerons's freedom to operate. And this is why we invested so heavily to generate our own embryonic stem cell patent portfolio, which is the dominant embryonic stem cell patent on this date on a worldwide basis.

Our continuous filings will extend our patent coverage for our products well into the future. We hold issued US patents on methods that scalably expand undifferentiated hESCs, methods that differentiate them into therapeutically useful cell populations, as well as several composition-of-matter patents on the cell population themselves.

Frankly, the WARF patents and that license were critical to us at the start of our work 10 years ago, but really is no longer so, especially given its expiration in five years. So the takeaway message here is that Geron is really the go-to guy for hESC licensing, not WARF.

So let me now turn to oncology. On the 5th of January, we announced a publication in the January 1st issue of Clinical Cancer Research from our collaborators at UT Southwest, that updated demonstrating that imetelstat, our telomerase inhibitor, inhibits telomerase activity and reduces tumor size in the xenograft models of glioblastoma, and the drug inhibited activity of glioblastoma stem cells in culture.

And this brings to a total of nine the number of cancer stem cells that have been shrunk to be inhibited by imetelstat, including the clinical data from our Phase I single-agent myeloma study, in which we showed telomerase in addition in bulk and tumor stem cell containing fractions of bone marrow that incurred for as long as 21 days after a single dose of drug. So these nine cancer stem cell types include myeloma, breast, melanoma, pancreatic, glioma, neuroblastoma, adult GBM, non-small cell lung cancer as well as prostate cancer.

So the significance of the in-vivo study is that the drug imetelstat actually crossed the blood brain barrier in these mice, baring human glioma tumors. The drug was given intraperitoneally. And we demonstrated telomerase in addition at a 60% to 70% level within three to five days of IV administration.

The significance of the in-vitro work is that the clonogenic and proliferative capacity of primary human glioblastoma initiating cells or stem cells was dramatically decreased following imetelstat exposure. Telomerase activity, telomere length were reduced, leading to cell death. And lastly, in this study, imetelstat was shown to be synergistic with temozolomide and ionizing radiation, which are the standard first-line treatments for glioblastoma after surgical resection.

On the second of March, we announced multiple presentations by Geron scientists and our collaborators at the AACR Special Conference on the role of telomeres and telomerase in cancer research. This was a symposium in Texas held between February 27th and the 1st of March. The conference had 10 scientific sessions with over 50 oral presentations, attesting again to the importance of the telomerase target in cancer.

The take-home message from our presentation and from the conference generally is first that telomerase is now a validated target in both the bulk tumor and in the cancer stem cell population. And obviously, we've now shown imetelstat to be highly active in both compartments.

Of equal importance, telomerase is now shown to be uniformly expressed across the volume of tumor cells in the tumor mass. And this is unique. For example, many other cancer targets, for example like HER2, are variably expressed among the individual cells in a tumor.

The presentations at the meeting included a key note by Professor Jerry Shay at University of Texas Southwest presenting data on imetelstat's activity in-vivo against human glioblastoma stem cells. Other presentations documented the activity of imetelstat on stem sells from myeloma, melanoma, breast, pancreatic, glioma and neuroblastoma.

Several key presentations, including one by our collaborator, Uri Tabori at the Hospital for Sick Children in Toronto, showed activity of imetelstat and xenograft models of several kinds on pediatric neural tumors, providing a clear rationale for the eventual clinical use of imetelstat in pediatric brain cancer.

Data presented by Robin Frink of UT Southwest showed activity of imetelstat in multiple non-small cell lung lines in-vitro. And finally, we presented data from our Phase I studies that showed telomerase in addition in bone marrow, peripheral blood and hair follicles, verifying that we are hitting the target at or below the dose we plan to use on our upcoming Phase II randomized studies in breast and non-small cell lung cancer.

And I'm pleased to report today that the FDA has cleared our IND for the randomized Phase II study in non-small cell lung cancer, which should begin enrolling patients in June of this year as scheduled. That study will enroll about 100 patients from about 20 US medical centers and will take about 20 months to complete including the follow-up.

Lastly, I'd like to give a brief update on the VAC1 Phase II trial in AML. And I'm pleased to report that all of the subjects previously reported to be in complete remission, meaning both clinically and at the molecular level, remained so at this date.

So the numbers are 15 out of the total of 21 patients remain in complete remission. 14 of those 15 patients are now in the extended boost phase with remission durations ranging between 7 and 28 months. And perhaps most interestingly, 9 out of 11 patients in the high risk for relapse group are still in complete remission.

So as previously noted, we will be awaiting the follow up at -- the analysis at the end of this year, before we announce our development plans for VAC1 and VAC2 for 2011. So with that, I'm now happy to turn the call over to the question and answer session.

(Operator Instructions). And your first question will come from the line of Mark Monane of Needham & Company. Please proceed.

Thank you. Good morning, and thanks for reviewing the progress at Geron with us. I have a couple of questions regarding the various programs. I was intrigued to hear about the Alzheimer's disease program and OPC1. Is this something that you're going to -- how would you, given the variety of activities available with your embryonic stem cell program, does this shift any of the rank order of the different programs? And maybe you can review with Tom and Geron's favorite order for the various programs.

The simple answer is, no, Mark. I mean, we are well down the road toward reinitiating the clinical trial in spinal cord injury. And as we discussed on the call last time, because the confirmatory animal study to reinitiate this trial, which you'll remember are in thoracic patients, the animal study is in the cervical region, and the agency has agreed to allow us to use this study to move more rapidly into cervical patients for dose escalation.

Geron should have efficacy data from both our own work and from Keirstead's work to show extensive survival of neuronal and axon damage in cervical models of injury. So this really forward-advances the spinal cord program in terms of our access to the dominant fraction of the spinal cord marketplace, which is cervical injuries. And I'll remind the listeners that the marketplace for severe, incomplete, and complete injuries in the United States is substantial; it's a very large leukemia market. So we haven't changed our rank order of the first trial to begin.

Now, what's important though is that the first product, OPC1, which IND we expect has been approved, will enable us to efficiently, assuming the animal data in stroke, Alzheimer's or MS is confirmatory, to rapidly expand the program into those indications. Obviously the size of the opportunity in Alzheimer's or stroke would dwarf the opportunity size in acute spinal cord injury. And we think it's important to return as much value as we can near-term with the first embryonic stem cell product out of the box.

Turning to the other cell types, which I think you asked about, Mark, our second program in terms of rank order or chronologic order is still the cardiomyocyte program. We now have very good evidence in both rat and in pig, a large animal, that our cells engraft, induce host vascularity into the graft, and that the engraftment is accompanied by improvements in cardiac output.

The data in rats as you know has been published some years ago. We've been presenting the early data in pigs, which is really quite remarkable, because the size of the infarct in the pig is much larger than what we were doing in the rats. So the pigs actually receive a 90-minute coronary occlusion and then reopening; so this is a severe infarct. And actually there is a mortality rate in the pigs just from the infarct.

And the rationale of course for pigs is that we will need safety studies in a second animal model, and the physiology, the heart rate of the pig is very similar to man. And this enables us to do very extensive electrical monitoring to demonstrate that there are no ectopic foci of activity in the pig's heart, which would be the prime concern to move this into man.

Following cardiomyocytes of course is the islet program that we've talked about and presented how we've advanced the status of that cell dramatically over the past year. And we have now sent those cells to an independent academic lab funded to do nothing more than analyze the maturation process and secretion kinetics of insulin by various isolated cells in response to changing glucose concentrations.

And the results of that study show that our cells actually produce 50% of the amount of insulin on a cell-by-cell basis, as compared to a fully mature human islet. We've demonstrated now that those cells when transplanted into animals further mature, and they mature into cells that either secrete insulin or glucagon, which is a gold standard for their maturity.

And you can find levels of human C-peptide in the blood of these animals. And when we give the animals a bolus of glucose, we can see dramatic increases in the amount of human c-peptide in the blood of the animals. So we know that these cells are now active after injection. And all this is very good news.

Then we turn to VAC2, which as you know is our follow-on program for VAC1, which we believe has a lot of advantages, both economic and perhaps even in terms of efficacy and potency over VAC1, that is still in development.

And then lastly, the chondrocyte program, which is doing very well, completely funded by the UK government through our wholly-owned subsidiary in England. And we are now injecting the ES-derived human cardiomyocytes into large animal models of arthritis. And this will be the gold standard for us to confirm that in a large animal across a major weight-bearing joint, these cells not only restore cartilage and subchondral bone integrity, but they can withstand the trauma and weight-bearing of an animal that resembles humans in terms of the forces across the repaired joint.

That was very helpful added information. Thank you. And I was intrigued by the comment earlier, and I could see from your clinical development that the companies is moving much more into longer and deeper clinical trials. And so, David, could you comment on how many people are at Geron right now and if there has been a change in the mix of the kinds of people with different skill sets to correlate nicely with the planned clinical progress?

Yes, it's a challenge, Mark. The headcount is about 180. And a year ago, the headcount was about 172 or something, I'll guess. So the challenge for us is to keep not just all these balls in the air, but to keep these program trains moving down the track. That does require an evolving mix. So the new hires are obviously all well experienced, most of them fairly senior development people that bring particular expertise and skill sets that we need to apply today and tomorrow.

Most of the costs, as I mentioned earlier, are external costs, the lines are crossed. We spend more money outside the company today than we do inside the company.

To add a little color to that, good question, Mark, we have matured and change the mix particularly in the oncology group. And frankly, some of the oncology folks, for example in clinical operations, are beginning to add some oversight on the stem cell side as we move and plan more than just the OPC1 program into a clinical environment.

So the kind of experience that we now have in-house on the cancer side expands to over 17 companies—their prior lives--in the oncology space, and these are all well-known biopharma companies, numerous Phase I through IV clinical trials of cancer, including over 40 successful IND submissions in oncology and over 20 successful NDA DLA submissions.

And the list of drugs that our people have had a significant hand in developing starts with Avonex, Avastin, Herceptin, Leustatin, Ontak, Tarceva, Sutent, Rituxan and so on. So people what we have on Board have incredible track records in taking oncology programs across the finish line.

Thank you very much for the added information and coloring, and we look forward to future progress.

Your next question comes from the line of Ren Benjamin of Rodman. Please proceed.

Hi, good morning, and thanks for taking the questions, and congratulations on your progress. Tom, I know that you don't want to talk about the spinal cord program that much, but I have a couple of notes from previous calls that I'm hoping that you can just shed some light on.

One is, is there some long-term safety data from the preclinical safety data or nine months spinal cord injury preclinical data having to do with cervical breaks that we are expecting around this time? Or is that just something that I have in my notes that's not happening?

You are 100% correct, Ren. We announced that back in the fall when we were put back on hold and disclosed what the plan to get off of hole included. And one of the major pieces of that is exactly the study that you cite. It's a nine-month at topic tissue study in cervical-injured animals.

That is part of the database that is now being reduced in preparation for our submission. And again, I can't talk about the data simply because you can't do that before it's submitted to the agency and they've had a chance to review it. But again, read my lips here. We are highly confident that this trial will reinitiate in the third quarter.

Great. And so any additional steps to cite -- I know you've got this in the past. But is there -- as you're reducing things, are there any more experiments that need to be done or is it all now paperwork that needs to go in there?

Well, simple answer is no. The animal study was of course the biggest bogey for us to get over. There are other scientific issues, which have been completed. For example, the qualification of these new release specs. There is quite a dossier of how you have to do that to the satisfaction of both our internal quality department as well as the agency.

We do not, for example expect there will be any significant changes to the protocol. We have maintained contact with all our clinical trial sites, keeping them abreast of how we are progressing. So we really see this as a restart, you know, without any significant alterations from the original plan.

Great. Switching gears to oncology, and I jumped onto the call a little bit late, so I apologize if you've already gone over this. But I know that there is -- you know, in our notes again, we have several Phase I trials that, I know pretty much all come to a sort of conclusion. For me the best way to ask this is, can you just tell us the status of the ongoing trials right now, and again, when the non-small cell cancer trial is expected to begin?

Yes, let's start with that first, because perhaps you did miss that. We've received clearance from the agency to begin the trial. We are now doing all of the contract negotiation with the 20 or so sites that will -- in United States that will conduct the trial, and we are absolutely on track to enroll the first patient in that randomized Phase II in June as we had previously announced.

The Phase Is you're correct are coming to an end. Four of them are finished, the two that are still ongoing are the solid tumor trial in which we are looking at a once-a-month intravenous injection other than Imetelstat, again for PK, PD determination. And the other trial that is still going on, again for the same purpose, looking at altered dose schedules, is the combination breast cancer trial where we are combining our drug with Taxol and Avastin, the first line therapy.

We would expect both of those studies to complete over the next couple of months, and obviously all of their data is what supports the dosing, the dose interval, and our confidence that we have learned the lessons we needed to learn to design a Phase II study that is appropriately powered to demonstrate a significant clinical impact on both non-small cell lung and breast.

I'll remind you that the non-small cell lung is structured and powered to give us a hazard ratio of 0.5. We are expecting to literally double the progression-free survival from 2.6 months to 5.2 months in the non-small cell lung trials, and it is all designed and structured to achieve that.

And again, all of the presentations at these ACR meetings that we're talking about absolutely confirm the strategy of using this drug to both de-bulk the primary tumor and to clean up the residual cancer stem cells that we know to be resistant to frontline therapy. And at the Cancer Stem Cell Conference I presented at in Boston, there's now new evidence, and that's pretty good, that shows that in addition to the normal differentiation of a cancer stem cell into the progenitor and fully matured bulk tumor cell, which we've all known about for years, there is now evidence for retrograde that residual bulk tumor cells can actually dedifferentiate back into the stem cell compartment, which adds a new complexity to the theory of how to cure a tumor.

And again, our drug would affect both of those vectors; stem cell going toward the bulk, and bulk going back to stem cell. So all of the data thus far in both our own Phase I program and the preclinical modeling done by us and our collaborators, absolutely confirms the rationale for both of our randomized Phase IIs in lung and breast cancer.

Excellent. And data from -- you know, data in the next I'll say six to 12 months, do we have any presentations at ASCO or at AACR, NCI, EORTC or ASH?

Yes. So, we didn't talk today about the AACR presentations in April just because that's a, you know, Q2 event, but we'll review that at the next call. And yes, there is a presentation at ASCO, which would be the results of our combination imetelstat breast cancer study. We will also have a presentation in the EORTC meeting in Germany in November on the solid tumor study.

We are on track as I said to initiate the Phase II in non-small cell lung in June. We expect to announce the first patient dose in our Phase II myeloma study at the end of the third quarter, and we will initiate and announce the first patient dose in our Phase IIs in essential thrombocythemia and the randomized Phase II in breast in the fourth quarter of this year.

Terrific. I guess one last question from me. Today - yesterday was a huge day for cancer vaccines and the cancer vaccine platform in general with the Provenge approval. Clearly, you guys have a stake in this space as well, especially given the data that you've just updated in AML.

Any thoughts as to whether or not you'll be putting this program on to the fast track or maybe faster track, if you will, especially given what's happened lately in the interest that the investors may have and physicians may have in the cancer vaccine space, can you give us some sort of an idea as to what's happening with this program now?

Yes, that's a very good and well-framed question, because it's exactly what we are working on at the moment. I am going to be cautious, because the data are still early, and I want to remind everyone that this is an unblinded single-arm study that is small, 20 or so patients.

But it was very well designed, and we are increasingly excited by what we are seeing. And when we say that the 9 of the 11 patients at a higher risk for relapse are still in complete remission, if that's the case at the end of the year, this is highly significant, because while it's a small group, again, but these when we say at high risk, we really mean high risk.

They are elderly. They have bad phylogenetics and bad molecular markers. And many of them have entered the study in CR2. So we really did stack the deck clinically against the likelihood that the vaccine would be useful. And despite that headwind, thus far it looks pretty exciting.

So yes, there's no question that there is an opportunity here for VAC1, and we are working on that subject to the duration of the remissions by end of year. I would say though that as we said before, the VAC1 technology, just like Dendreon's, is limited in terms of volume, cost and utility. And because these are [autologous] cells, there is always the possibility that a unique genotype reduces the efficacy of their own cells, impact of their disease on the efficacy of their own cells, impact of prior therapy on the efficacy of the process, plus the cost.

And we have those same issues as does Dendreon. Those issues all go away with VAC2, which is scalable. I mean this is like a Gardasil for cancer. It's stored frozen, off the shelf. There is no limitation in terms of the number of doses. We're clearly showing that in the VAC1 trial.

And interestingly, I didn't mention this, some of our patients now have run out of vaccine. And so it'll be very interesting to see what happens to their remission over time in the absence of vaccination. And that is an unfortunate limitation of VAC1, although in theory you could [increase that again] and continue their dosing.

But the point is it's a very expensive and labor-intensive way to maintain patients in remission. And from all the biology we've done with VAC2, the evidence is that VAC2 will be much more efficacious, because although it'll be haploidentical, you have the opportunity to do both direct and indirect antigen presentation. And we've certainly in VAC1, preliminarily validated telomerase as an immunotherapeutic target, right? But for VAC2, we have the opportunity of adding multiple tumor-specific antigens right in the manufacturing phase.

So the upside -- again, to your question, you know, moving on to the interest generated by Dendreon's success is important for us. And frankly, we believe we hold the patents and the technology for what will really be a broadly useful and inexpensive and highly-available immunotherapy for cancer.

Terrific, thank you very much. Just like I guess the field of monoclonal antibodies, this is now kind of Shepherd's Inn and you are of more improved cancer vaccines to come out through development and eventually into the market. Congrats.

Thank you. And we also take our hat off to Dendreon. I mean this is not simple for them to do. They invested a lot of money in this and they stuck with it, and I think the field and frankly we are benefiting from what they've accomplished.

Thanks, guys. Congrats.

Your next question comes from the line of Steve Brozak of WBB Securities. Please proceed.

Good morning, gentlemen. I guess the last three analysts have asked a lot of questions that relate to everything I'm interested in. And obviously, Mitch Gold, and hats off to him, has basically showed that he stuck it out and he's gotten through the door here with, what, $93,000 in terms of dosing price.

I'm going to switch the topic here, because you mentioned something, I think, David, in terms of your headcount. You have more collaborations probably than any other company that we cover and certainly probably any company your size.

Let's just ask a straighter question. In planning for success, how would you -- I mean one program succeeds, and you're going to have a lot of reverse inquiries as to how to do business. How do you go out there and deal with something like that into the future? Because if you head in one area -- large pharma doesn't have anything, what are your plans for something like that happening? And then I'll add the follow-up after that.

Well, Steve, I think that the answer becomes specific rather than general. And by that I mean program-specific rather than general. I mean, each of these programs as you know could be a distinct company. That's not to suggest that that's our corporate organization strategy going forward. We will be deliberative and appropriately opportunistic with how we move towards commercialization for any program that is progressing nicely through the clinic.

So today, we're focused on progressing programs nicely through the clinic. It's possible that Geron could commercialize a product, whether it is this product or whether it is that product. You just need to accomplish the steps in order to commercialize, just like you need to accomplish the steps in order for the company to conduct clinical trials.

So, that's not an impossible proposition. On the other hand, there are large pharmaceutical companies out there that are tracking everything we do in every program, and they express over time increasing curiosity or non-interest in that. So I believe we will have opportunities for commercialization partnerships when we have reached the point on the value accretion curve, meaning -- again, the hockey stick event that allows us to that on very advantageous terms. So, I think that's the answer. I mean, we have an awful lot of experience on our Board and in the team here to evaluate how to take programs forward.

Well, actually you just hit my next question, you know, in terms of the companies that are now tracking you. Because obviously, you know, there is just nothing out there in terms of the large pharmaceutical industry. And you do have a Board and you do have management that has an in-depth ability to negotiate with these large firms. How many -- just iterate, how many large partnership programs do you have, and how many -- your IP portfolio is more extensive and -- again, just about any other company we follow.

What kind of -- you know, in terms of safety profile, the fact that you have this many partnerships, would that provide some kind of a safety valve in terms of, if some company were to express, how should I put it, too much interest in your entire franchise, how would you reconcile that statement?

Well, you asked a couple different questions. It's true that we have an extensive patent state, whether it's around telomerase for anti-cancer programs, whether it's around telomerase activation to address senescent conditions. We have -- Tom mentioned earlier, we have the dominant patent state for the human embryonic stem cell technology platform. That's just -- that's definitive and it's really not contested.

We have a third patent state around nuclear transfer. And we have out-licensed through drug JV companies that we don't have time to talk about very frequently. But those companies, like Biogen, and start with our licensing and operating companies that use nuclear transfer technology for Ag applications.

And all of those we manage discreetly, and we'll continue to do that. We don't view our patent state either offensively or defensively. It is -- it's the way we catalogue our achievement and the assets that are owned by shareholders now, and we do license people.

We have probably licensed pieces of our portfolio to five dozen companies over time. And some of those licenses have materialized into product applications that contribute to the royalties that I expect to grow in future years, and some of them have not. But we view our patent let's say opportunistically. And we have told every community, the stem cell community, we've told the oncology community that we are prepared to license companies to work in the field; that can only add to the momentum in the field.

If you recall back to the original license we gave to Merck for -- on the telomerase side for their vaccine platform, we created a head-to-head competitor, and we did that intentionally. We liked the dendritic cell approach that we had pursued in VAC1 and we will pursue in VAC2. But Merck had another platform. And we were quite pleased to go head-to-head.

So I think that's one question you asked. You asked another question I think, which is, there's so much going on here, there's -- Y is a portfolio of assets and they are valued at X, and is that undervalued, and what are we going to do if someone takes note of that?

Well, that's sort of a classic and general issue that we talk about at a Board meeting every time we have a Board meeting every other month, and with our investment bankers. So I will tell you, on that level, we're prepared to respond to any enquiry. You've not had -- you heard us advertise this company for sale in bits or large pieces or as a whole. We think we are living in that trading range where companies trade when they're doing Phase I studies.

And when you bring back human POC from Phase II studies for efficacy, you start seeing that -- the shape of the curve change, and you see value reflected in the stock -- not for our current shareholders.

So the company's not for sale today. We will work hard to deliver on the milestones that we lay out, achieve those [hockey stick] events, and I think that's appropriate for the current shareholder.

I look forward to writing about it. Thanks very much and congrats.

This concludes the Q&A session for today's call. I'd like to turn the call back over to Mr. Greenwood for closing remarks.

Listen, thank you all for joining us again this morning. This was actually quite a long list of participants. We are presenting at three investor conferences over the next two months, and we hope to see you all there. Thanks very much.

Thank you for your participation in today's conference. This concludes the presentation. You may now disconnect. Good day.