Alaunos Therapeutics Inc (TCRT) 2017 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the ZIOPHARM Third Quarter 2017 Earnings Conference Call.

(Operator Instructions) I would now like to introduce your host for today's conference, David Connolly, Vice President of Corporate Communications and Investor Relations.

Please begin.

Thank you.

Earlier today we released our financial results for the third quarter 2017 with a press release, which is available on our website, www.ziopharm.com.

During this call -- and I'm on Slide 2 for the forward-looking statements -- representatives of the company will make a number of statements that are forward-looking, including statements regarding the potential of therapeutic candidates in our development pipeline.

Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond our control, including the risks and uncertainties described in our SEC filings.

Results may differ materially from those projected on today's call.

We undertake no obligation to publicly update any forward-looking statements.

Next slide, please.

We'll provide a corporate update, review our pipeline and our clinical development programs with our gene therapy for gliomas and cell therapies for hematologic cancers and solid tumors.

I will now turn the call over to Dr. Laurence Cooper, CEO of ZIOPHARM Oncology, who will lead today's call.

Good day to everybody, and we're on Slide 4, with the management team.

With me here in Boston for this call is Dr. Francois Lebel, our Chief Medical Officer; Dr. David Mauney, our Chief Business Officer and also the Interim Chief Operating Officer; and Caesar Belbel, our Chief Legal Officer.

As you can see and will hear, we've built out the management team around me with these new additions of David Connolly as Head of IR and David Mauney as an important part of the senior team.

So what I thought we'd do is I'd turn the call over to David Mauney for a few minutes and let him introduce himself.

Sure.

Thanks, Laurence, and good afternoon, everyone.

Obviously I'm truly thrilled to be here at ZIOPHARM, and I certainly thank Laurence and the board for giving me this great opportunity.

My job is to help build shareholder value, plain and simple, and having a deep and longstanding with ZIOPHARM, Intrexon and several of our key constituents gives me a competitive advantage in that effort.

I truly believe ZIOPHARM has the breakthrough solutions to attack big problems that still exist in the fight against cancer and our scientific foundation is stronger than ever.

Moving on to Slide 5, I wanted to take a minute to remind you how powerful our story is.

Our company is built on 2 distinct, important platforms and we enjoy several great partnerships that you can see at the bottom.

First, on the left-hand side, our gene therapy platform.

The idea here is to improve your existing resident immune system and be able to call it to war, if you will, against cancer, and not only turn this response on or off on command, but also to be able to tune it up and down.

We are completely unique in this regard, thanks to the RheoSwitch technology.

Our platform is centered on a cytokine called IL-12, which just happens to be the most powerful regulator of the immune response in our bodies.

We now know, with the data to show it, that we are capable of delivering, inducing, dosing and safely controlling IL-12, a feat that was doubted by many just a year or 2 ago.

Our first application is in a devastating type of brain cancer called glioblastoma, where we see 160,000 new cases per year worldwide and almost 13,000 in the U.S. alone.

90% of these tumors will recur, with a total 5-year survival of less than 5%.

I won't steal Laurence's thunder, but the data we are seeing in real time is very interesting and powerful and continues to build.

Most importantly, patients appear to be living longer as a result of our efforts, and that is a very powerful thing for which we all take great pride.

Shifting now to the right-hand side of the slide, we have our cell therapy programs.

And in this case, instead of taking your existing immune system and calling it to war, we are instead designing and creating brand-new immune soldiers, if you will, specifically for your cancer.

We differ from our competitors, as you know, in that we use a non-viral system called Sleeping Beauty to deliver genetic information.

This is a key point.

It's a major differentiator amongst our competitors, as -- many of whom use a traditional virus-based system.

We believe that virus-based systems face significant headwinds relative to cost, complexity of delivery and ease of use, to name a few.

With a non-viral system like Sleeping Beauty, we have the potential to offer real-time infusions at a fraction of the cost and at many more hospitals and for many more patients.

In addition to addressing the 173,000 people in the U.S. who will be diagnosed with hematologic cancers next year, ZIOPHARM is also addressing the approximately 1.5 million people who will be diagnosed with an invasive solid tumor, which we believe will require a truly personalized approach with an individual's unique neoantigen signature.

A non-viral system, again, has many advantages here, and we will be in the clinic in 2018.

We have patients who were dosed with our non-viral construct 4 years ago, as you will see in our ASH abstracts, and we can now say we have a validated platform that is blocking and tackling its way towards real-time manufacturing.

This non-viral platform really has the potential to turn the business of treating cancer on its head by changing the paradigm of cost, complexity and scale.

To conclude, we look forward to an exciting end of this year and a big 2018.

Thank you, and I now turn it back over to Laurence.

Thanks, David.

We're thrilled to have you on board and to be in a position to leverage your leadership and experience, focusing importantly on business development and corporate strategy.

It's certainly an exciting time for ZIOPHARM in the months and the years ahead.

So let's go to Slide 6, our pipeline slide.

And I'm really going to highlight here 3 programs.

The first is the adenoviral program.

And just to make sure we're all oriented according to the nomenclature, Ad is adenovirus, RTS is the RheoSwitch and hIL-12 is human IL-12.

So we're advancing this adenoviral program for the controlled delivery of IL-12 for the treatment of glioblastoma; and importantly, recurrent glioblastoma.

Since our last call, we have developed and publicly presented additional evidence that supports the mechanism of action as well as the survival benefit and we have, I think, significantly, really exciting presentations at SNO coming later this month.

ZIOPHARM's breaking new ground here, as we're the first company to demonstrate control and modulation of IL-12, this critically important protein that David mentioned, for stimulating an effective immune response from the brain.

In the CAR programs -- and the CAR, of course, stands for chimeric antigen receptor -- in the CAR programs we're seeing progress towards our stated goal of reducing the manufacturing times of these genetically modified cells with the non-viral Sleeping Beauty technology.

With our first- and second-generation trials at MD Anderson, we have reduced manufacturing of the CAR-modified T cells down to 2 weeks.

But we're not stopping there.

We're moving into the clinic in 2018 with very rapid manufacturing, under 2 days.

This, again, will be a new standard for the field, achieving this very rapid manufacturing.

We call this our point-of-care technology and we think this is a game-changer for the field of T-cell therapy.

Our TCR program, or T-cell receptor program, listed underneath, is in collaboration with Dr. Steven Rosenberg at the NCI.

This is an exciting approach that leverages the same Sleeping Beauty system, but in this case we're genetically modifying the T cells with T-cell receptors targeted to neoantigens.

And these are unique to each patient's cancer, and importantly, each patient's solid tumor.

This puts us on the map, therefore, and on the pathway to targeting that 1.5 million people with invasive cancers that David talked about.

And we're doing so with the best in the business.

We're going after antigens which give rise to cancer.

In other words, we're targeting neoantigens and we're tackling, therefore, the root of the problem.

Steve and his team have made significant progress and expect to be in the clinic in 2018.

These neoantigen technologies are among the most fascinating and fast-moving subfields in immuno-oncology and we're really delighted to be working with the NCI on this.

Regarding our NK cell program, given all of what we're doing and all the excitement we have with these other programs, we're turning our energy to focus on the genetically modified NK cells moving forward.

So in summary for this slide, before I really get into the specifics of the program I want to reiterate that the programs of adenovirus, the point-of-care CAR and the TCR -- these 3 are the top priorities for ZIOPHARM and, we think, the value drivers for our company.

So the next slide is the transition slide, Slide 7, as I get into gene therapy.

More and more, we're building the case with clinical evidence that the adenoviral program for the controlled delivery of IL-12 using the small molecule activator called veledimex not only extends survival of these very sick patients with recurrent glioblastoma -- and I would add, more so than any therapeutics to come before us -- but it's becoming increasingly clear that the ability of IL-12 and to control IL-12 will give neuro-oncologists and patients alike a much-needed therapy when others have failed.

So let's look at Slide 8, and I want to update you on where things stand with our glioblastoma program.

And to put this program in context, we really called out the new information and data since our last call.

And significantly, we've got 3 lines of evidence that show why the patients with recurrent glioblastoma benefit from the immunotherapy -- in other words, the controlled production of IL-12.

The first kind of major bullet point I want to get across is that we're seeing antitumor effects in the brain.

In May -- and this was the data associated with ASCO -- we announced there was a 12.5-month median overall survival at 8 -- an average follow-up of 9.2 months.

And that really related to our Phase I trial, treating the patients with recurrent glioblastoma.

Since then, we're seeing increasing evidence that we've indeed, as we expected and as we hoped for, activated the immune system in the brain tumor.

So we have 3 lines of evidence that really point to that.

The first line is that patients who received low-dose systemic steroids, and -- which is given really for their postoperative management, had a better survival rate than those who received elevated steroids, as the latter presumably interferes with the immune activation driven by IL-12.

And indeed, as I reported earlier, there's 100% survival -- 100% survival for patients with recurrent GBM who received this lowest dose of steroids in the context of IL-12 therapy.

Furthermore, the survival appears to be directly correlated to a ratio of these effector -- in other words, these killer T cells -- to the suppressor T cells -- that ratio.

And we can measure that ratio in the peripheral blood.

And again, as one increases that ratio, the patients appear to be surviving longer which, again, is consistent with IL-12-mediated immune activation.

And then we've also seen control.

There's no doubt that the switch now can tune or modulate the levels of IL-12 and the associated immune response.

And really, one of the kind of major strengths also to highlight from our data is that drug-related adverse events in the Phase 1 trial were entirely predictable, rapidly reversible by the simple stopping of the veledimex.

So on the next slide, Slide 9, let's look at some really, I think, remarkable data.

So we've had the opportunity with our physician colleagues to biopsy brain tumors in 3 patients.

And this is many weeks after the completion of veledimex.

And you can see, for instance, there's a crosshair -- there's a red crosshair on your screen that is highlighting a lesion in somebody's brain.

And when the neurosurgeon goes into that lesion, remarkably, we see a new infiltration of these CD8 or in other words killer T cells.

And these T cells are not just sitting there.

They are being called to fight.

And we can see that because they're making a powerful cytokine called gamma interferon.

In other words, IL-12 has engaged these T cells to be active and engaged them, importantly, in the fight against the glioblastoma.

There's also another major bullet on this slide, and that is that we have remarkable data showing that the glioma lesions in these patients are getting smaller after our Il-12 therapy.

So these data provide us further confidence that what we're seeing is indeed a beneficial effect of IL-12.

Not only do we see survival data, but we increasingly understand why these recipients are surviving.

And there's no question that the switch is working, and now I think there's no question that the IL-12 is working.

So on Slide 10, we're really thrilled to be able to update you in about 2 weeks from now at the Society of Neuro-Oncology in San Francisco, where we're going to be presenting additional data.

Dr. Chiocca -- and he's the Chief of Neurosurgery at Harvard -- he's going to update you on our progress on our Phase I study.

And his presentation will include a survival sweep -- the latest data, if you would, in terms of the survival on that Phase I trial to evaluate the adenoviral program with the activator ligand veledimex in treating patients with recurrent glioblastoma.

And again, just to kind of frame this, we last updated you in May when we announced the 12.5 months median overall survival.

And obviously, more time has gone by, and we'll be delighted to update you further at SNO in terms of that survival data.

And I think, significantly, his data will also reinforce the mechanism of action of how IL-12 is engaged in the immune system.

I gave you a bit of a teaser, if you would, on the prior slide about how that's working.

And I think once you see Dr. Chiocca's presentation it'll reinforce that the IL-12 is the actor -- is the way that these patients are surviving.

Additionally at SNO, Dr. Stew Goldman is going to present an update on the trial design for our new Phase I study of adenovirus to control the delivery of IL-12 plus veledimex for the treatment of pediatric brain cancers.

And as we announced last month, Dr. Goldman in Chicago has dosed the first patient on this trial.

Because some of you will not be at SNO in San Francisco, the company will provide a conference call after these presentations to discuss these data, and we're really looking forward to doing so.

So next slide, Slide 11 -- this -- so we're -- I think you'll see from this that we've really made terrific progress in advancing the adenovirus and the controlled production of IL-12 for gliomas.

And the positive data keeps on coming from our Phase I trials, and indeed that's what I'm alluding to really at SNO.

Our stereotactic Phase I trial in recurrent glioblastoma really broadens the population of patients who may be eligible for treatment.

And delighted to say that's open and enrolling.

And as I mentioned, the same with our pediatric trial, which is now open and enrolling, just as we discussed.

We're really looking forward to initiating our combination trial with the anti-PD-1 agent later this year.

And as a reminder, our preclinical data, where we combine tunable IL-12 with this immune checkpoint inhibitor yields 100% survival in the mice.

Again, really encouraging data that makes us excited about opening that combination trial.

And I think the point also on this slide is to really get to the pivotal trial here.

And based on feedback from U.S. and regulatory agencies on our plans for the registration study, the company's going to initiate a randomized controlled trial this year.

The Data Safety and Monitoring Board that will be associated with that trial will be reviewing the data that comes out of that trial at regular intervals and will have the opportunity to recommend various actions; and especially if the data looks good -- and we expect it to look good -- including early study termination.

We're really excited to start this randomized controlled trial, as we think it best addresses the needs of patients as well as the company.

And I think the randomized controlled trial, quite frankly, gives us the best design for commercial success.

As I've mentioned before, and I'll just highlight here, we're currently in discussions with more than one partner for this program and we'll be moving forward with these discussions.

And as these strategic opportunities unfold, we're optimistic about the study and advancing IL-12 as a drug.

Okay.

So we're going to switch gears now to the cell therapy program.

And this is Slide 12.

And this again is our non-viral gene therapy platform to modify T cells.

And we believe the genetic engineering of T cells will make future T-cell therapies faster and more effective than viral-based therapies.

And we've developed this technology so that it's scalable and we can make T-cell therapy available to many, many more patients.

So on Slide 13, this is a -- really a culling of some recent headlines that are in the lay press.

And I think what -- that -- what is -- struck -- strikes me is that these recently-approved cell therapies are really quite costly, and the current manufacturing time comes in and is measured in weeks, somewhere between 17 and 20 days.

And I think we've been very thoughtful here and have solutions for the very rapid manufacturing of T cells.

In other words, we can address the issues of cost and scale of T cell therapies.

So let's look on Slide 14 how we're going to do that.

And here, ZIOPHARM is focused on point-of-care, or POC.

And this is to achieve very rapid manufacturing in under 2 days.

This, again, will be a new standard for the industry.

And to get this done, we're focused 3 core technologies which are unique to us.

The first is the Sleeping Beauty system -- this transfer of DNA rather than virus to genetically modified T cells.

The second is the engineering of IL-15, this critical cytokine that provides a survival signal to T cells, and this allows the T cells that are genetically modified to be grown inside the patient rather than in manufacturing facilities.

And the third part is the use of a switch -- the use of a switch to control the T cells after infusion.

So on slide 15, we've broken this down into its component parts.

And this was by design.

This is how ZIOPHARM is tackling, essentially, the idea to provide a new standard for the production of T cells.

So we've done this in 3 trials.

And the first-generation trial is completed, and we're currently enrolling in the second-generation trial.

And really, the team is thrilled to be on the cusp of entering the clinic with genetically modified T cells that can be manufactured in less than 2 days.

Indeed, this -- we anticipate this point-of-care biology will enter the clinic next year.

As a reminder, our initial trials using the first-generation CAR were with 4-week manufacturing, and that showed favorable survival of patients with lymphoma and leukemia.

And as David mentioned in his opening remarks, this trial enrolled patients many years ago, and we'll have some important updates on the outcome of those patients.

Our second-generation trial really pressure-tested shortening manufacturing time to release the T cells within 2 weeks essentially after they've been programmed; and importantly, also, to shorten the amount of time that it takes to release the T cells.

Because you need essentially those 2 things to occur -- the manufacture and the release -- before the patient can get the cells.

And we have shortened both.

And this one-two punch, if you would -- this first-generation trial followed by the second-generation trial really gives us great confidence for the opening of our third-generation trial.

So part of that confidence comes because we're looking ahead to ASH on Slide 16.

And I've highlighted the 5 presentations we have with our partners at Intrexon and MD Anderson.

We're going to have updates on patients who enrolled in our first-generation trial.

We're going to have updates on our second-generation trial.

Both of these used the Sleeping Beauty system.

We're going to comment on the persistence of the infused CAR-T cells.

And we're going to comment also on the survival of the patients.

That's in addition to giving further information about our preclinical data regarding this very rapid manufacturing -- the point-of-care manufacturing.

Our first-generation trial, as I alluded to, is really providing us some of the most mature, multi-year -- not just months now but years-long -- follow-up on our patients.

Our second-generation trial infuses T cells after lymphodepleting chemotherapy, and it really tests the suite of improvements that I've really alluded to over this last year around the CAR, the manufacturing and the release of the T cells.

And I think what's really exciting is that these trials are generating a lot of enthusiasm as we progress to our third-generation trial in the point-of-care to enter the clinic next year.

We also, as part of our update, will comment on our regulatory T cells as well as also an update on our CD33 program, which is currently enrolling at MD Anderson.

So let's go now to Slide 17, which is the summary, really, of where we stand with respect to our partnership with the NCI.

And this is the work we're doing under a CRADA with Steve Rosenberg.

He's developing tumor-specific T cell therapies, and he chose us -- he chose the Sleeping Beauty system to genetically modify T cells with neoantigen-specific T-cell receptors.

And I would just like to highlight the pace -- the rapid pace of progress.

Essentially, we signed the CRADA in January of this year -- January of 2017 -- and we have progressed through the preclinical data.

We've actually progressed through writing the clinical trial, where we're currently pressure-testing in a scale-up and validation process the biology.

And all of that has been done within a year.

And we're then going to go on and launch the clinical trial next year.

This clinical trial will be under the direction of Dr. Rosenberg.

And it's really amazing at this point, because we are going to be the first company to be able to genetically program T cells using this non-viral approach to really make a personalized T-cell therapy to go after the Achilles heel of cancer, to go after these neoantigens, which are the hallmark of why patients develop solid tumors.

So 2 slides now on the corporate update.

Slide 18, we can go over quickly to really rest on Slide 19.

At the close of the quarter we have approximately $84.4 million in unrestricted cash resources plus approximately $29.4 million at MD Anderson Cancer Center from our prepayment program under the research agreement.

And these funds support our programs to be conducted at MD Anderson Cancer Center.

We anticipate that our cash -- current cash reserves will be sufficient to fund our operations into the fourth quarter of 2018, and that includes starting the randomized controlled trial.

So those are my prepared remarks, and let me turn it over to the operator, if I may, and then we can open it up for questions.

Operator, are you there?

(Operator Instructions) It looks like our first question comes from Keith Markey with Griffin Securities.

Dr. Cooper, I was wondering if you might be able to elaborate a little bit?

I understand that the first trial involving the Sleeping Beauty-prepared CD19 CAR-T cells combined with hematopoietic stem cell therapy had a significantly longer survival than historical controls.

Would you be able to tell us a little bit about that?

Sure.

So thanks Keith.

So that -- those data -- the initial snapshot of those data were presented at JCI, in the publication.

And indeed, there's actually a lot of background information in that publication around the safety of the Sleeping Beauty system -- a lot of the informatics associated with gene transfer using this first-in-human approach.

As we have watched these patients, though, over the intervening period since the publication, we have really recognized that there's contributing data that looks very supportive for the Sleeping Beauty platform.

And so at ASH, we'll update you on that dataset, which will include longer survival; longer follow-up for these patients.

And indeed, I think, reflecting on the use of the CAR field, our survival data for patients will be amongst some of the most mature that's out there.

Really we're going to be talking in terms of years, Keith, not just months.

Right.

Great.

Thank you.

And then I was wondering if you might be able to tell us -- it sounded to me like the design of the Phase III IL-12 GBM study would be -- might fit the definition of an adaptive trial design, where you have an opportunity to look at survival data on an interim basis and halt the trial early.

Is that -- and did I understand that correctly?

Yes.

So thanks, Keith.

So we're going to give additional information about that trial later in the year.

We're actually going to launch -- initiate that trial this year.

So we'll have more to say about that in the -- really in the coming weeks.

And our next question comes from Reni Benjamin with Raymond James.

I also had, I guess, just a -- maybe a follow-up with Keith's question regarding the pivotal trial design.

I know, Laurence, you mentioned that you're going to provide more data; but could you give us a sense -- you've mentioned these -- the importance of the -- of keeping steroids at a low level and the impact of steroids.

Can you maybe talk a little bit about how that might play into the pivotal study design, and are there any sort of biomarkers that you may be following that help you identify those patients that might have the right level of effector T regulatory cells to start off with, that might help that (inaudible)?

Sure.

Yes.

No, those are great questions.

And that's really one of the -- I think the -- what the company's really been working on this year.

Just to remind everybody, we've gone from a Phase I to a Phase III trial in rapid order here.

And part of the reason we're going to be successful is that we didn't just jump to starting the randomized controlled trial.

We spent this year really understanding our patients in greater depth, and in particular understanding what makes essentially for patients who do better.

And you're exactly right to call out the reduced dosing of steroids.

So that's indeed part of our strategy.

I can't -- I won't tip all of our hand today, but I can tell you that that is what we're -- exactly in line with what we're thinking, that patients on the trial will be in that sort of reduced steroid cohort, if you would.

And how are you thinking in terms of maybe the numbers; or if you can't get into details, how long do you think this study should last until we see some results?

Yes.

That's a great question too.

We will -- again, I think the best way for me to say it is that we'll give you more details towards the end of the year when we initiate it.

And then the guidance around that will be the pacing of the study and the enrollment of the study.

Got it.

And maybe just as a quick follow-up, with the CAR programs and the data that you'll be announcing at ASH, obviously you mentioned with the first generation you'll have much longer follow-up.

Can you give us a sense, with both the first generation and second generation, about how many patients in each are we looking at?

And then in the second generation, would we be seeing response rate data?

What should we be paying attention to?

Sure.

So in the first-generation trial there were no new patients.

That trial is basically following the existing cohort.

The second-generation trial, we haven't said how many patients are on, and you'll see at ASH those patients.

What we're really essentially looking for in this sort of first- and second-generation trial is the movement towards the third-generation trial.

These trials -- these 2 trials were not designed to be commercialized.

They were designed to answer discrete bodies of knowledge so that the company could obtain insight into the very rapid manufacturing, and importantly also insight into the regulatory process.

And that's really, I think, where we're excited about the data and really can say with great confidence that it really points us in the right direction.

But of course you and others want to learn something in addition about, do the T cells survive and the do the patients survive.

And of course we'll provide that update.

But it's the -- I think what I would like to leave the community with is that these trials really are designed to get us to the point-of-care.

Swayampakula Ramakanth with H.C. Wainwright.

This is R.K. from HCW.

A couple of quick questions.

I'm just trying to understand the strategy behind initiating a trial with the combination of the PD-1 inhibitor, with your -- with the IL-12.

Is there going to be a patient -- certain patient population that will be different from the pivotal trial?

I'm just trying to understand, how are you positioning this trial?

Sure.

So this will be -- this is a Phase I trial.

It'll still be with recurrent GBM.

And it's really to test this hypothesis.

We clearly -- and I think you could see that from our brain biopsy -- brain tumor biopsy data -- we can clearly make cold tumors hot.

And that's striking.

Indeed, it's striking for our potential partners, quite frankly.

Because we can, as a result, really have a line of sight now to engage these immune checkpoint inhibitors and make them work more effectively.

And of course you can see that in your mind's eye.

If a tumor's cold and doesn't have any T cells in it, then if you pump anti-PD-1 into the patient it's not going to provide a lot of biology because the T cells are not in the tumor.

Now with IL-12, we can definitively say the IL-12 is calling in those T cells, and this immune checkpoint inhibitor then can really go to work.

So I -- we're -- as we pointed out on the mouse study, the data was extraordinary in the mice -- 100% survival in some of the cohorts.

And we think that we'll really see some very interesting data in the human now.

Great.

Then I was wondering if you could provide us an update on the stereotactic trial and also on the pediatric brain tumor study.

Sure.

Yes.

Those are 2 really important studies.

So they both broaden the application of the adenoviral program.

The stereotactic trial obviously is for patients who couldn't go to re-resection, and we've started treating patients.

We'll have more to say, but not yet today.

And the same with the pediatric trial.

That's just getting going.

We'll have more to say; but again, we'd like some more time to develop that data.

And our next question comes from Tony Butler with Guggenheim Securities.

Just a brief question on the partnership, and at least the pivotal trial and certainly the combo trial in recurrent GBM plus a checkpoint inhibitor.

Are both of those dependent on a partnership?

That's #1.

And #2: would the trial designs change if and when you're able to gather that partnership?

I'm just trying to understand, a, more importantly not just the timing by the end of the calendar year but more importantly, a larger trial or a smaller trial or some other permutation.

Yes.

Sure.

Thanks, Tony.

So the randomized controlled trial does not depend on partnership.

Nor does the anti-PD-1 combo trial.

But obviously the company, as we've mentioned, is in discussions.

And part of the reason that these discussions have continued is that we talk about the trial design with these potential partners.

So we're really guiding folks now that the randomized controlled trial is what we're going to initiate by the end of the year.

Our next question comes from Jim Birchenough with Wells Fargo Securities.

It's Nicholas (inaudible).

So just on -- for the point-of-care CAR-T program, can you just review what the key features are there?

So is it a blood draw versus apheresis; dose; lymphodepletion; can you do simultaneous patients or is there a specific device that could be rate-limiting?

Sure.

Those are good questions, Nick.

Thank you.

So the technology is, we showed on the slide it has these 3 pieces, right?

That's the DNA transfer with the Sleeping Beauty system -- the non-viral approach.

The co-expression of the CAR with this IL-15 -- and just, not to get too technical but this -- what's called this membrane-bound IL-15.

And then of course the switch.

These 3 pieces now really are plug-and-play.

And this I think is the real beauty of the technology.

Because it doesn't rely any more on building out sophisticated infusion like big GMP facilities.

This is technology where simple electroporators can be used to transfer the DNA into the recipient T cells, and then those T cells in very rapid order, in under 2 days, are then infused -- directly infused into the patient.

And it's really the biology behind the IL-15 that allows the patient to serve, if you would, as the incubator for these T cells that then grow inside him or her.

And that, Nick, is just a really scalable solution, because instead of having to apherese the patient, ship the product to a centralized facility, manufacture for weeks, release the T cells and then ship them back, we essentially have this code of conduct -- this very rapid circuit, really going from a needle in the arm to electroporator, followed by rapid infusion.

Without obviously lymphodepletion, if it's so (inaudible).

Yes.

That's going to be a really interesting part.

And you and I have had a chance to talk about it.

So just for the rest of the audience -- so IL-15 is one of the molecules that is liberated or freed up when you lymphodeplete the patient with chemotherapy.

And so if you can provide -- if I can provide T cells with their own IL-15, the real question's going to be, does the patient indeed need lymphodepletion?

And we're going to test that, Nick.

We're going to test that in the clinical trial and you'll hear obviously more about it as we get into (inaudible).

And then, Laurence -- and for the neoantigen strategy, I noticed Steve Rosenberg just listed a vaccine trial with dendritic cells loaded with neoantigen-specific peptides.

So in your discussions with him, or perhaps in your opinion, what are the various strategies for targeting neoantigens, and do you feel like a TCR strategy is going to be sufficient or might you need a vaccine strategy plus a TCR strategy?

Sure.

So to target neoantigens -- you the nail on the head.

There are 2 approaches: vaccine, and then the infusion of T cells.

And vaccine has some advantages around, for instance, that you can -- it's easier to make.

You're making it with RNA or you're making with peptides, or you just alluded to Steve's program with dendritic cells.

But the issue, of course, is will the vaccines really work when there's kilograms of tumor in the patient?

That's really the question.

And as you know, patients with metastatic epithelial cancer are really untreatable in the United States right now, despite checkpoint inhibitors.

And so we're really feeling that one has to provide the immune cells.

One can't use vaccines to sort of activate the body's native immune cells.

One has to be able to use a set of killer T cells targeting the neoantigens to do so.

And I think Steve joins with us on this.

And he -- obviously you saw his New England Journal of Medicine paper and his Science papers, which indeed do exactly that.

They grow up neoantigen-specific T cells and then they infuse them back into the patient.

So -- and we think that's really the way to go for patients, especially patients who have large amounts of tumor.

Great.

Look forward to hearing about the data at SNO.

And our last question comes from Michael Schmidt with Leerink.

This is Varun Kumar on behalf of Michael Schmidt.

So my first question is on combo study with anti-PD-1 in glioblastoma.

You kind of touched on this earlier.

So my question is actually, when Opdivo was not found to provide survival benefit over control arm in the recurrent glioblastoma patient in CheckMate-143 trial earlier, can you provide your takeaways from that as you proceed for your combo study with anti-PD-1?

Yes.

I think our understanding of that data is that one of the reasons it failed is that there weren't T cells within the tumor -- within the brain tumor, for the anti-PD-1 to disinhibit, if you would.

And so what IL-12 has done and what, again, we've shown in 3 of 3 biopsies -- this is quite extraordinary data now -- in 3 of 3 biopsies we can see the T cells infiltrating into the tumor, making those cold tumors hot.

And so it really begs the question now, will essentially the combination with anti-PD-1 make the T cells even more effective after IL-12 therapy?

Yes.

That's really helpful.

And just a last question on the pivotal trial design in the glioblastoma.

Now certain genetic molecular markers, for example IDH mutation, they have been associated with favorable survival benefit in glioma patient.

So just wondering if for your pivotal trial design, is there any current plan for patient stratification based on genetic markers?

Yes.

That's a great question.

So our read of that literature is that these type of genetic markers are important for primary diagnosis and are less impactful at the -- in the recurrent setting.

And I think the position -- what you say to patients is that once your disease has recurred it's already declared itself to be a bad actor, and no amount of these sort of upfront biomarker studies take away from just the pressing case that your disease has come back.

So for us the biomarker, if you would, is the fact that the patients have all recurred.

And at this time I'm not showing any further questions in the queue.

I'd now like to turn the call back over to Laurence Cooper, CEO, for any closing remarks.

Yes.

Thanks very much, operator, and everybody listening in.

I appreciate your attention, and we look forward to joining you next at SNO.

Thank you so much.

Ladies and gentlemen, thank you for participating in today's conference.

This does conclude today's program.

You may all disconnect.

Everyone, have a great day.