MacroGenics Inc (MGNX) 2016 Q4 法說會逐字稿

Good afternoon. We will begin the MacroGenics 2016 fourth quarter and full year conference call in just a moment. All participants are in a listen only mode at the moment and we will conduct a question and answer session at the conclusion of the call. At this point I would like to turn the call over to Jim Karrels, Senior Vice President and Chief Financial Officer of MacroGenics. You may begin.

Thank you, Operator. Good afternoon and welcome to MacroGenics' conference call to discuss our fourth quarter and full year 2016 financial and operational results. For anyone who has not had the chance to review our results we issued a press release this afternoon outlining today's announcement which is available under the investors tab on our website at www.macrogenics.com.

You can also listen to the conference call via our web cast via web cast on our website where it will be archived for 30 days beginning approximately two hours after the call is completed. I would like to alert listeners that today's discussion will include statements about the Company's future expectations, plans and prospects that constitute forward-looking statements for purposes of the Safe Harbor provision under the Private Securities Litigation Reform Act of 1995.

Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors including those discussed in the risk factors section of our annual quarterly and current reports filed with the SEC. In addition, any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. While we may elect to update these forward-looking statements at some point in the future we specifically disclaim any obligation to do so even if reviews change except to the extent required by applicable law.

Now, I would like to turn the call over to Dr. Scott Koenig, MacroGenics' President and Chief Executive Officer.

Thank you, Jim. I would like to welcome everyone participating via conference call and web cast today. Thank you for joining us. Following our standard format to these calls I will take a few moments to review MacroGenics' progress before handing the call back to Jim who will walk us through our 2016 financial results. Then in the time available I will provide more detail on some of MacroGenics' development programs.

2016 was a significant year for MacroGenics. We continued to recruit metastatic breast cancer patients in our Phase 3 SOPHIA study, initiated our Phase 2 study in advanced HER2-positive gastric cancer of our Fc Optimized (inaudible) antibody in combination with an anti-PD-1 molecule and advanced our franchise of B7-H3 targeted therapeutics as well as our several DART-based oncology product candidates.

During the year we initiated a Phase 1 study of our own anti-PD-1 anti-body and also showed that our autoimmune based DART molecule achieved the anticipated biological effects in the Phase 1 study in healthy volunteers. Moreover, and I think this is a key takeaway for the investment community today, as illustrated at our R&D day in December, each of our proprietary oncology programs in the clinic has shown initial evidence of anti-tumor activity.

Clearly, this is very encouraging and drives us to continue to advance our product candidates and future development plans. The progress of MacroGenics' diverse pipeline of clinical assets is attributable to our strategy and maximizing the productivity of our antibody engineering platforms. Our commitment to develop treatment options for patients suffering from a wide range of diseases is stronger than ever and we believe we are moving in the right direction.

I will provide more detail on these clinical developments and our overall pipeline shortly, but now I will turn the call over to Jim to give an overview of our financial results for 2016.

Thank you, Scott. This afternoon we reported financial results generally in line with expectations. As described in our release, MacroGenics had research and development expenses of $122.1 million for the year ended December 31, 2016, compared to $98.3 million for the year ended December 31, 2015. This increase was primarily due to increased activity in our pre-clinical immune checkpoint programs, the initiation of two Phase-1 clinical trials, combining enoblituzumab with other compounds, the initiation of a Phase-1 clinical trial of MGA012 and the addition of the NIAID funded MGD014 contract.

These increases were partially offset by decreased manufacturing costs from margetuximab. We had general and administrative expenses of $29.8 million for the year ended December 31, 2016 compared to $22.8 million for the year ended December 31, 2015. This increase was primarily due to increased staff, recruiting costs, stock-based compensation expense as well as patent expense. We recorded total revenue consisting primarily of revenue from collaborative agreements of $91.9 million for the year ended December 31, 2016 compared to $100.9 million for the year ended December 31, 2015.

Revenue from collaborative agreements includes the recognition of deferred revenue from payments received in previous periods as well as payments received during the year. For the year ended December 31, 2016 we had a net loss of $58.5 million compared to a net loss of $20.1 million for the year ended December 31, 2015.

Our cash, cash equivalents and marketable securities as of December 31, 2016 were $285 million, which includes $8 million of non-current marketable securities. The $285 million compares with $339 million as of December 31, 2015. Based on our current operating plan we believe that our cash, cash equivalents and marketable securities combined with anticipated funding under our current strategic collaborations should fund the Company's operations through late 2018.

And now, I'll hand the call back to Scott.

Thank you, Jim. MacroGenics ended 2016 with nine programs in clinical development including our proprietary programs and those in development with our collaborators, Janssen and Pfizer. There's been a commitment of MacroGenics to submit an IND, or Investigational New Drug application, for at least one new drug candidate each year. I am pleased to say that we have met this goal in 2016 and extending this commitment we expect to submit two INDs for new molecular (inaudible) in 2017.

As a brief review and as many of you know each of the candidates in MacroGenics pipeline is derived from the Company's antibody engineering platform including our proprietary Fc optimization and bispecific DART technologies.

I will now update you on the pipeline as it stands today and provide some guidance on what we expect will be a productive 2017. I will start with margetuximab, our most advanced program and one that is actively enrolling patients in the pivotal Phase-3 SOPHIA study where patients with metastatic HER2 positive breast cancer. In the SOPHIA trial we are evaluating the efficacy of margetluximab plus chemotherapy as compared to trastuzumab plus chemotherapy following progression after previous HER2 targeted therapies.

This study is designed to enroll 530 patients. As of today we have approximately 185 trial sites activated in both the US and Europe. I would like to note that one of the inclusion criteria for SOPHIA will be changed so that patients will no longer require prior treatment with (inaudible) and (inaudible) or (inaudible).

This study amendment was based on the analysis of both evolving clinical data in breast cancer and the prescribing pattern landscape of currently marketed anti-HER2 agents. Both the US and EU regulatory authorities have agreed to this proposed protocol change and is expected to be become effective for SOPHIA after review by national regulatory authorities and institutional review boards for the clinical trial sites. We remain on track to complete recruitment of the SOPHIA study in late 2018.

On a different front we continue to study margetluximab in a Phase-2 trial in combination with pembrolizumab, an anti-PD-1 therapy for patients with advanced HER2 positive gastric and (inaudible) cancer. The proposed combination regimen would allow patients, all of whom have limited treatment options, to avoid chemotherapy while utilizing the immune mediated killing properties of both margetuximab and anti-PD-1.

This trial is being conducted in collaboration with Merck which is providing pembrolizumab. The study will enroll 30 patients in the US and patients in Asia and we expect to complete enrollment this year. Along with margetluximab we are advancing our other oncology focused programs including those within our B7-H3 franchise. I would like to reiterate a point stated in previous sessions. That we are developing what we believe is the leading franchise of product candidates that target this member of the B7 family of immune regulatory molecules. We have multiple programs that target B7-H3 through complimentary mechanisms of action and take advantage of this targets broad expression across multiple solid tumor types.

It is also worth emphasizing that all of these programs are 100% owned by MacroGenics. The most advanced B7-H3 candidate we have in development is enoblituzumab, which is an Fc-optimized monoclonal antibody. Recruitment for three Phase-1 studies of enoblituzumab is ongoing. These studies include a monotherapy study and a combination studies of each of ipilimumab and pembrolizumab. As reported, the additional dose expansion portion of the monotherapy trial was expanded to include additional prostate and bladder cancer cohorts.

The combination study with pembrolizumab is currently in dose expansion while the ipilimumab combo study is completing the final dose escalation cohort. In addition, two monotherapy Phase-1 studies were recently initiated. A study for children with various solid tumors including neuroblastoma and an investigator sponsored study in men with localized intermediate and high risk prostate cancer in the (inaudible) setting.

MacroGenics B7-H3 franchise is comprised of candidates that target B7-H3 through a variety of complimentary but differentiated approaches. Our second clinical candidate in this portfolio is MGD009, our B7-H3 x CD-3 targeted DART molecule. Our Phase-1 study of MGD009 continues to advance in patients across several defined solid tumor types. Adverse events have been manageable to date and initial signs of anti-tumor activity have been observed as was disclosed at our R&D day back in December. We expect to establish a dose that's scheduled for MGD009 administration as well as initiated dose expansion cohorts in 2017.

The third molecule in our B7-H3 franchise is MGC018. We are conducting IND enabling activities to support an IND application for this anti-B7-H3 Antibody Drug Conjugate, or ADC, in 2018 and plan to feature it in a poster presentation at the 2017 AACR annual meeting in April. Circling back to our DART program we have a total of four programs in Phase-1 development including MGD009 which I just described. We believe that this is the leading technology and portfolio of bispecific antibodies. MacroGenics provided an in depth update on our entire portfolio of proprietary clinical DART programs at our R&D day in December 2016.

In addition to MGD009, our oncology DART programs include (inaudible), our MGD006, a CD123 x CD3 DART molecule that is being developed to treat patients with AML or MDS. An MGD007, a gpA33 x CD3 DART molecule that is being developed to treat patients with primary and metastatic colorectal cancers. Both of these DART molecules are currently being studied in Phase-1 studies.

(inaudible) was granted orphan drug designation for AML by the FDA in late 2016. At our R&D back in December we described how we have been navigating various mechanism based and on target side effects through judicious use of (inaudible) and other medications as well as modification of dosing.

Following such changes we have been very encouraged by initial signs of anti-tumor activity. We expect to be able to establish the dosing schedule as well as initiate dose expansion cohorts for MGD006 and MGD007 in 2017. Also in Phase-1 is MGD010. A DART molecule designed to simultaneously target the B cell surface proteins CD32B and CD79B. This is the first DART molecule developed for the treatment of autoimmune disorders. In late 2016 we completed the Phase-1 study of MGD010 in healthy subjects.

We plan to report updated clinical pharmaco dynamic activity results from this study in 2017. The final programs that I will discuss today make up our PD-1 directed immuno-oncology franchise. As we discussed at our R&D day we are advancing these programs to enable a broad set of combination opportunities across the Company's portfolio.

As is desirable when targeting a proven mechanism of action our PD-1 based compounds provide further differentiation from existing PD-1 based treatment options. MGA012, a potential basis for combination therapy with several of MacroGenics's proprietary oncology focus molecules is being evaluated in a Phase-1 clinical study across multiple solid tumors.

We expect to establish the monotherapy dose and initiate our first combination study for MGA012 later this year. Our R&D for MGD013, a DART that target PD-1 by LAG3, two immune checkpoint molecules expressed on T cells remains on track for the first half of this year.

MacroGenics is developing MGD013 to provide co-blockade of PD-1 LAG-3 for the potential treatment of a range of solid tumor and hematological malignancies. Beyond the oncology and autoimmune therapeutic areas we have a DART molecule MGD014 that targets the HIV envelope protein and CD3. We expect to submit the IND for MGD014 during the first half of 2017.

As Jim alluded to during the financial update the progress we have made this year was accomplished while maintaining a strong balance sheet including our cash position. The coming months will be busy and our team looks forward to providing updates on a regular basis.

Finally, I'm very pleased to tell you about the recent addition of Dr. Karen Ferrante, and Scott Jackson to our Board of Directors. Dr. Ferrante is a hematologist oncologist and most recently served as Chief Medical Officer and Head of Research and Development at Tokai Pharmaceuticals. Mr. Jackson served as Chief Executive Officer and is a member of the Board of Directors of Celatore Pharmaceuticals until his acquisition in July 2016. I look forward to Karen's and Scott's contributions to MacroGenics's Board.

This concludes my prepared remarks and we would be glad to address any questions that callers may have. Operator?

(Operator instructions). Our first question comes from Yigal Nochomovitz, with Citi. Yigal, your line is open. You may ask your question. Did you want me to go ahead and move on to the next question?

Yes. Please go ahead. Yigal, you're not on the line?

The next line looks like it's the same name so it might be on the next line. I'll go ahead and open up that one.

Hello. (Inaudible). Can you hear me?

Yes.

Yes. (inaudible) presentation looks like you are going to present two abstracts for new target ADA MI. Can you talking about that new target and how it is going to be differentiated from other oncology targets? Thank you.

Thank you for that question. As you have noted, we have submitted a number of abstracts for the upcoming AACR presentations and one of these is targeting a protein called Adam-9 which we have identified as over expressed on a number of tumor sites. Tumor types. And we have been working on looking at the utility of targeting this with -- an anti-body drug conjugates and we will be presenting some data in collaboration with investigators at Immunogen showing activity in pre-clinical models. So we're excited about the prospects of this pre-clinical data to date.

Great. Thank you. And one more question. So on clinical (inaudible) the Phase-1 trial for MGD011 (inaudible) the trial still is expanded since I think last September. Do you have any update on the status of the trial?

Yes. As I have noted on previous calls, with regard to updates on MGD011, the CD19 x CD3 DART molecule, this is a responsibility of Janssen and we are not -- we're precluded from presenting any update. We do have updates with them on a timely basis and they have indicated at our last conversation that they're continuing the dose escalation in all solid B cell malignancies and have plans for future study in combination with Imbruvica. So all -- as we know of today that seems to be consistent.

Okay. Thank you very much for taking my questions.

Our next question comes from Michael Schmidt, with Leerink.

Hi. This is Jonathan Shane stepping in for Michael. Thanks for taking my questions. First, can you, and you touched on this earlier, expand on the rationale behind expanding the SOPHIA eligible patient population to include Kadcyla naive patients and can we expect an interim futility analysis in late 2017?

Jonathan, thanks for that question. You know, as I noted earlier on the call, we have been examining the use of Kadcyla in various lines of therapy in patients with metastatic breast cancer and we have seen both in the US and Europe that there is a substantial number of patients that are not receiving Kadcyla in the prescribed second line therapy.

And with this data we approached both the FDA and EMA with this information with the idea that we would have an opportunity to be able to treat a larger population that could benefit from margetuximab. And when they reviewed the data they agreed with our conclusion and thus permitting us to release the requirement for patients to be treated with Kadcyla in the study.

Any color on the interim futility analysis?

Oh, yes. So with regard it to the futility analysis, as I said previously, this is an event driven analysis and we still believe that we will be ready to conduct the futility by the end of 2017.

Great. And then on to B7-H3. Can you talk about how you're thinking about prioritizing your different B7-H3 programs and how you're thinking about B7-H3 development strategy moving forward?

Thanks for that question. As you know, we have a strong commitment to this franchise around B7-H3. We are very encouraged by the data we have seen to date with enoblituzumab showing single agent activity in a number of tumors including those that had been on previous checkpoints. Much of our focus right now, as we have noted, is looking at the combination with other checkpoint inhibitors.

Particularly anti-PD-1. And as I noted earlier, we expect a substantial number of these patients to be enrolled in up to four different tumor types this year and so for enoblituzumab we will wait to see the data to determine A, which particular tumor type to pursue in next clinical trials and the design of that. And, clearly, if we do see activity, for instance, in patients that have been on previous checkpoints that are now responding, that's a population we can address, but right now it's still too early to make that decision.

With regard to MGD009 we are extremely encouraged while still in dose escalation that we were seeing evidence of anti-tumor activity at a 10 microgram per kg dosing level. And so what we have decided to do is as we continue to dose escalate the drug to do a small dose expansion at the 10microgram per kg dosing and we are now recruiting patients at that dosing level. We expect, as I noted earlier, probably around mid-year to identify the specific dose for MGD009 and at that point we will be moving into six different tumor types for further evaluation.

So our expectation towards the end of 2017 and into 2018 we should be able to make some key decisions about the next steps for both enoblituzumab as well as MGD009. And then finally with regard to our B7-H3 ADC which again is a completely different mechanism of action, we will complete the toxicology studies this year and if they're successful, we plan to move forward into a clinical trials next year. And obviously, that's too early to determine the pathways for that molecule.

Great. And maybe just one last one. Are you able to provide any guidance at this time on when we might see more data from the various B7-H3 studies?

Again, the opportunities we believe will arise in the second half of 2017 and into 2018. It will be dictated, obviously, the timing for submissions of abstracts to the various scientific meetings. I would say, as I have outlined things right now with expectations of the dose escalation for MGD009 and determining that dose we may have an opportunity late this year to present that initial data. Obviously, not on any of the expansion studies. The same thing holds for the enoblituzumab combination studies with PD-1.

We'll see how the rate of enrollment comes during the course of this year in the four different tumor types. So we're exploring. We're not going to wait for all the four different tumor types to provide opportunities to update in the investment community on this. So when we have completed enrollment and we have an idea about the activity, we will provide that and, again, that could be in late 2017 or in the first part of 2018.

Thank you. Next question comes from Stephen Willey, with Stifel.

Hi. This is Philomena Kamya on for Stephen Willey. Thanks for taking my questions and congratulations on the progress. My question pertains to the MGD006 program (inaudible). Would you please perhaps give us an update on the supportive care initiatives that were outlined during the R&D day with respect to management of (inaudible) relief syndrome? How are these going so far?

Philomena, thank you very much for the question. Yes, we have been very encouraged by the progress we have made over the last few months on MGD006. As outlined this first DART molecule that went into the clinic we wanted to address particularly with the initial dosing of this drug some higher grades of [cytokine] release that we were observing in these subjects.

As we noted on our R&D day, we adopted a two-step approach for dose escalation where we had a lead in dose of initially 30 nanograms per kg for three days then we increased that to 100 nanograms per kg for four days during the first week of enrollment. And then we were analyzing subsequent dosing over the course of the next few weeks either as a four day on, three day off schedule or continuous dosing for 21 days and then flipping back to the four days on, three days off.

What I can say is that the strategy seems to be paying off. Patients seem to be tolerating the approach quite nicely. We do intervene as necessary for support of care with anti-cytokines such as giving support with (inaudible) and low dose steroids. And we have been able to continue our plan for dose escalation and we're in the middle of that right now. And as we indicated at our R&D day, our expectation is that by the latter half of this year we hope to establish the dose for this drug and then talk about next plans for expansion in AML and potentially other indications as well.

Okay. So is it my understanding that there is a position for the cytokine suppression to be in an outpatient setting?

The answer is currently we have patients are inpatient initially during that first cycle but then quickly move over to an outpatient setting.

Okay. Thank you very much for taking my questions.

Our next question comes from David Lebowitz, with Morgan Stanley.

Thank you very much for taking my question. I was going to ask about MGD010. I'm just curious as to what the status is of the program after Takeda had to pull out last year and what are your next steps?

Thanks very much for that question. As we updated at our R&D day and the follow-on from the data we presented at UR last June, we were very encouraged by the activity we're seeing in our normal volunteer dose escalation study. The subjects tolerated the drug quite nicely with no grade threes and very minor grade one/two side effects.

And what was very compelling was the biological effects we were observing which included no loss of circulating B cells with very profound evidence of biological activity as noted including the inhibition of B cell signaling the suppression and dose-dependent manner of IGM levels which were observed as long as 56 days after the single dose and a down regulation of surface associated IGD and IGG as well as CD40. We added on an additional cohort where we gave MGD010 in combination with an active vaccination, in this case a test antigen for hepatitis A, and showed in a subset of those subjects in December a profound reduction in induction of antibody specific responses.

We have completed that trial now. We're finishing the analysis of the data and expect to provide an update on the rest of that cohort in the first half of this year. And then making some decisions on how to best develop this in the autoimmune setting. As I have noted before we have a number of parties that have approached us given the robustness of the activity. We're evaluating these opportunities individually and we'll make a decision probably sometime by mid this year and we will either decide to continue to develop this ourselves in an autoimmune setting or alternatively look for a partnership. So, that's sort of progress to date.

Thanks for the taking the question.

Our next question comes from Mark Breidenbach, with Roth Capital Partners.

Hey guys. Thanks for taking the questions. First of all, let me just focus on a couple of the DART programs, specifically MGD006 and MGD007. Is it the intention to present the dose ranging results independently of the dose expansion cohorts so there's a possibilities maybe of seeing additional clinical data this year for both programs?

So, Mark, thanks for the question. Obviously, we would like to provide that data as soon as its available. We're still doing the dose escalation for 006 and 007. Just to give a little bit more granularity I have already described our progress with 006 and as I said our expectation is we hope to establish the dose by the end of the year for 006, but then with timing of abstracts and presentations, you know, it is a possibility of being presented by the end of this year, but it may lapse into early 2018. So I can't be more definitive at this point until we actually have the data in hand.

With regards to 007, as we pointed out in our R&D day again, we believe that we have developed a strategy for mitigating some of the on target effects on the normal GI tract with expression of the gpA33 antigen in the colon and small bowel. We have shown evidence initially at R&D day of a single patient at that using this strategy that had evidence of a PR and so what we have decided to do is sort of a two-fold strategy.

One where we're expanding and we plan to recruit additional patients at the one microgram per kg dosing. This could be as many as up to 20 patients. Again, patients are coming into this trial at that dose. And simultaneously we're also exploring a small step up of dosing with a drug in a separate population. And so we hope that by the latter part of this year we would have identified a specific dose. Obviously, look at the evidence of biological activity clinically and then make the decision about moving forward. And at that time we, again, would submit to a scientific forum to present the data. This could be late this year or early next year depending on the appropriate forum.

Okay. Fair enough. If I can ask a follow-up question. Thinking back to experience of bispecifics and (inaudible) therapies in AOL we have seen that CRS, or patients who get some level of CRS tend to have, often have, positive clinical outcomes at least in liquid tumors. Would you expect the same to hold up in solid tumor indication like colorectal?

So, again, the colorectal story is somewhat different than just a straight CRS effect. Remember, as I pointed out, the side effect profile we're seeing with MGD007 is a consequence of the target being expressed on normal tissues. And what we have shown quite nicely at our R&D day is that in subjects that had these acute side effect profiles, which are manifested by GI effects, nausea, vomiting, diarrhea, primarily, that with evidence by biopsy from small intestine we found the localization at the site of gpA33 expression of T cells at those sites.

So, we believe that this is clearly an on target effect. There may be local cytokine production there that leads to this side effect profile, but it isn't as, the intensity of what was described in the (inaudible) story with AOL where those patients were observing the very profound cytokine release syndrome. This was more GI associated toxicity.

Okay. Thanks for that clarification and thanks for taking my questions.

Our next question comes from Peter Lawson, with SunTrust.

Jim, just a quick question around cash. How should we think about cash (inaudible) in 2017, and in particular how should we think about the R&D growth this year? Is it kind of akin to what we saw last year and I guess about 20% growth?

Thanks for the question, Peter. As I mentioned during the call, we do expect that our cash takes us into late 2018. We have not provided specific guidance regarding our level of spend in 2017 although consistent with our past several years we do anticipate that our burn will increase. So we should have an increase over what we just reported for 2016, would be my guess.

Got you. Thank you. And then, Scott, I might have missed this. Where does manufacturing stand at the moment? (inaudible) where you (inaudible)?

Yeah. So we have the current venue for manufacturing for all our clinical molecules is at our pilot plant in Rockville, Maryland except for now the Phase-3 material which we are -- for the SOPHIA trial for margetuximab, which we have engaged a contract manufacturer. We have made lots of the enoblituzumab both at the contract manufacturer as well as at our pilot plant.

As I have noted previously, we are in the midst of an expansion of our manufacturing capabilities at our site in Rockville, Maryland at our current headquarter facility, and expect that construction to be completed by close to year's end. And then the equipment obviously needs to be validated which we expect would take until the middle of 2018. At which time we would have the capacity up to 10,000 liters which would be a commercial scale. So we anticipate that could be the source for most of our next molecules that would go towards commercialization and then could be the back up site for the contract manufacturer for margetuximab.

Thank you. And, Scott, just your thoughts around small molecule (inaudible) target to (inaudible) molecules at the same time just how you're thinking around that and your own developments?

Could you repeat. Was that about small molecule use in IO?

Yes. Small molecule on inhibitors that can target to IO molecules at the same time. So kind of akin to your DART but much smaller.

Yes. So, obviously, there are many ways of approaching combination stories for IO and, you know, there are a number of companies that I think in name are not necessarily looking at two small molecules as often and you know the list as well of the large molecule and small molecules that are being combined together. And we don't exclude possibility that those opportunities are out there.

I would just say that our experience to date with our DART platform has been extremely encouraging from the pre clinical data that we have now generated with our PD-1 x LAG-3. We presented data if you recall at our R&D day for PD-1 x (inaudible), looking at two different constructs. We have looked at combinations targeting CD137 and specific antigens. So we think that we're not excluding the opportunities in small molecule combinations, but we think that we have a very good strategy taking advantage of the (inaudible) features of the bispecific DART and TRIDENT platform.

Okay. Thanks much.

Our next question comes from Boris Peaker with Cowen.

Hey. Thanks. This is actually Joe on for Boris. Thanks for taking the question. Just one quick one following up on the amendments to SOPHIA. You mentioned that there's a substantial number of patients who are not receiving (inaudible) setting. I wonder if you were aware of what's driving that decision and if it's something that's unique to that patient population?

Joe, thanks for the question. We don't know the full answer for the reason behind why the use of this drug is not necessarily following the label indication. But as I noted, we have observed that many of the patients are being treated at later lines of therapy with (inaudible) both in the US and in Europe.

And whether this is they're seeing other benefits of intervening therapies, or they're just holding out, it's not perfectly clear. But we think that this then does provide an opportunity for us to address a very large significant population after they progressed on (inaudible) and (inaudible). So we felt that this was an opportunity for the patients to benefit from our drugs.

Okay. Maybe just one quick follow-up. You mentioned that there are I think a hundred plus sites that are up and active for SOPHIA. Is that all planned sites or are you expecting more to open up in 2017?

Very good question. As we noted we had about 185 sites open. We have had interest from additional sites and we're actually exploring adding on some additional sites both in the US and in Europe. So those are being evaluated now and are likely to come on board obviously this year.

Okay. Great. That's all I got. Thanks for taking the questions.

(Operator instructions) I'm not showing any further questions at this time. I would like to turn the call back over to our host.

I would just like to thank everyone again for joining us and let you know that we look forward to updating you on each of the programs that we discussed today as we continue to make progress throughout the year. Have a great rest of the day.

Ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.