Xencor Inc (XNCR) 2021 Q1 法說會逐字稿

Good day and thank you for standing by. Welcome to the Q1 2021 Xencor conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. (Operator Instructions). I would now like to hand the conference over to your speaker today, Mr. Charles Liles, Head of Corporate Communications and Investor Relations. Sir, please go ahead.

Thank you and good afternoon. Earlier today, we issued a press release, which outlines the topics we plan to discuss today. The press release is available at www.xencor.com. Today on our call, Bassil Dahiyat, President and Chief Executive Officer, will provide a corporate overview and will review recent partnership news. Allen Yang, Chief Medical Officer, will review clinical updates. And John Kuch, Chief Financial Officer, will review financial results. And then we'll open up the call for your questions.

Before we begin, I would like to remind you that, during the course of this conference call, Xencor management may make forward-looking statements, including statements regarding the company's future financial and operating results, future market conditions, the plans and objectives of management, future operations, the company's partnering efforts, capital requirements, future product offerings, research and development programs, and the impacts of the COVID-19 pandemic on these topics. These forward-looking statements are not historical facts, but rather, are based on our current expectations and beliefs, and are based on information currently available to us. The outcome of the events described in the forward-looking statements are subject to known and unknown risks, uncertainties, and other factors that could cause actual results to differ materially from the results anticipated by these forward-looking statements. Including, but not limited to, those factors contained in the risk factors section of our most recently filed annual report on form 10K and quarterly report on form 10Q. With that, let me pass the call over to Bassil.

Thanks, Charles and good afternoon, everyone. Xencor's approach to creating antibody and cytokine therapeutics is based on our extant protein engineering platform. It's built on our extensive protein engineering know-how combined with our suite of XmAb Fc domains. Which we use to build novel molecular structures, improve natural protein and antibody functions, and create new mechanisms of therapeutic action. The plug and play portability of our XmAb Fc domains and the speed of our protein engineering capabilities enable us to rapidly explore different targets and biologies so we can select the most promising programs to take forward. We've been focusing our work on the expansion and use of our XmAb bi-specific platform, the newest XmAb component, to create antibodies that bind two or more different antigens simultaneously, and also to engineer cytokines with structures optimized for particular therapeutic uses.

Now, our many partnerships really highlight it's plug and play nature. Currently we have 15 ongoing partnerships for XmAb technology, which have now resulted in two marketed products. Alexon's Ultomiris for rare blood disorders and MorphoSys's Monjuvi is the first second-line treatment for patients with diffuse large B-cell lymphoma. Just this past March, our partner Vir Biotechnology, with its partner GSK, submitted an emergency use authorization application to the FDA for VIR-7831, their anti-SARS-CoV2 antibodies that incorporates our Xtend Fc technology. Based on an interim analysis of the phase three COMET-ICE trial, which demonstrated an 85% reduction in hospitalization or death in high-risk adult outpatients with COVID 19 receiving VIR-7831 as monotherapy, compared to placebo. The primary endpoint of the trial, by the way. Now Xtend was integrated into VIR-7831 for the purpose of reducing the dose administered and potentially enhancing its lung tissue bioavailability. Now, this partnership exemplifies our commitment to enabling the broad use of XmAb Fc technologies outside our core focus of oncology and auto-immune diseases and demonstrates XmAb's vast applicability to underserved areas like serious infectious disease. Now if authorized, VIR-7831 would then become the third antibody with our XmAb technology to reach the market.

Now, switching back to internal programs, we're currently running seven Phase I studies evaluating XmAb bi-specific antibodies and cytokines. This way, we're taking multiple simultaneous shots on gold clinic. And the proof of concept data we generate will guide which programs we independently advance, which we partner, and which we will terminate. I'll let Allen Yang, our Chief Medical Officer, review updates for our clinical portfolio. Allen?

Thanks Bassil. Since our last update about two months ago, we dosed the first subject in the Phase I study of XmAb-564, our wholly-owned, IL-2 Fc fusion engineer to selectively activate regulatory T-cells or Tregs for the treatment of autoimmune diseases. The goal of an IL-2 therapy for auto immune disease is to provide sustained low-intensity activation of Tregs while avoiding the pro-inflammatory systemic activation of effector T-cells. An IL-2 therapy that is selected for Tregs with an expanded therapeutic window compared to historic IL-2 approaches would have broad potential across many different autoimmune diseases. And pre-clinical studies indicate this may be the case for our program. It is engineered with reduced potency to improve tolerability, improve duration of action for this normally toxic cytokine. And using our XmAb heterodimeric Fc domain and Xtend technology enhances its half-life. XmAb-564 is now our second cytokine in the clinic, joining XmAb-306, our engineered IL-15 for oncology that is partnered with Genentech. The single ascending dose study will characterize the safety, tolerability, and pharmacokinetics of XmAb-564 in healthy volunteers. And it will include an analysis of key immunomodulatory biomarkers.

For the remainder of the year and into early 2022, we are planning to initiate several additional clinical studies to advance our wholly-owned bi-specific antibody drug candidates. First, for XmAb-717, our PD-1 CTLA-4 dual-checkpoint bi-specific antibody. In mid 2021, we plan to initiate a phase two study for patients with certain molecular subtypes of castration-resistant prostate cancer as monotherapy, or in combination, depending on the subtype. As these patients represent a high unmet medical need. Previously, this was planned as a phase 1B study, but we have transitioned it to a phase two study. We continue to expect that we will present more data from the ongoing phase one study's expansion cohorts later this year, as the data mature. And to this study, we have had an additional cohort of patients with relapse or refractory melanoma, with a more tightly-defined disease population.

For Tidutamab, our CD3 bi-specific antibody that targets SSCR2, we plan to initiate clinical study in patients with merkel cell carcinoma and small cell lung cancer, SSTR2-expressing tumor types known to be responsive to immunotherapy in mid 2021. Due to a COVID-19 related staff issue at the study site, study startup activities were delayed by a few months.

Shifting to Plamotamab, under our strategic clinical collaboration with MorphoSys, we are investigating the chemotherapy-free triple combination of Plamotamab, our CD20 by CD3 bi-specific antibody with Tafasitamab and Lenalidomide in patients with certain lymphomas. We plan to initiate the first of these studies in patients with relapsed or refractory diffuse large B-cell lymphoma, an aggressive type of non-Hodgkin's lymphoma, in late 2021 or early 2022, once we have finalized the recommended dose in our ongoing phase one study and complete operational preparation for the multinational trial. We plan to present updated data from the phase one study later this year.

Briefly, for XmAb-698, a CD38 by CD3 bi-specific antibody, which was formerly known as Amgen's AMG-424, we plan to support investigator-initiated studies and a new study is currently being planned to start later in 2021.

Last, we anticipate filing an IND for XmAb-819, our ENPP3 by CD3 bi-specific for renal cell cancer, later this year, and initiating a phase one study in early 2022. XmAb-819 uses our multi-valent 2+1 bi-specific format, which has two antigen binding domains to the tumor target, providing more selective binding for the high ENPP3 density expression on tumor cells, compared to the lower density on normal cells. The binding selectivity of the XmAb 2+1 format extends the range of targets amenable to CD3 bi-specifics. For example, our partner Amgen's AMG-509 program, targeting STEAP1 in prostate cancer, uses this format. In summary, we continue to advance our pipeline by graduating molecules into phase two and are bringing new novel agents into the clinic. Bassil?

Thanks Allen. Now we're always looking to grow this pipeline with new programs, as we have with our IL-2 Treg and ENPP3 programs that Allen just mentioned. Along this front, last month at the AACR annual meeting, we presented data from four pre-clinical stage programs, including our third cytokine, an IL-12 Fc fusion protein for oncology, two additional XmAb 2+1 CD3 bi-specific antibodies. These ones target [Cloud N6] and GPC3, as well as our PDL1 by CD28 bi-specific program. All four posters are available on our website. Now I'd like to take a moment to review this targeted CD28 platform, which is a new class of T-cell engager designed to compliment other mechanisms of T-cell activation, such as checkpoint inhibition or CD3 engagement. CD28 is a key immune co-stimulatory receptor on T-cells that has been difficult in the past to safely and effectively engage therapeutically. By targeting a CD28 binding domain to a tumor by using a bi-specific antibody, we have to boost the activity of T cells in a tumor-specific way to enhance T-cell directed therapies.

Our most advanced wholly-owned lead CD 28 candidate is a B7H3 by CD28 bi-specific antibody for potentially broad solid tumor use, including in prostate cancer, where B7H3 is highly expressed. This molecule is advancing through clinical development now. Of course, the focus of our new collaboration with Janssen, that we announced a few months ago, is to discover a CD28 bi-specific antibody against a prostate tumor target. A core part of our business is to compliment our internal development portfolio with partners like Janssen and many other leading companies in the industry. These partnerships generate payments from the licensing of XmAb technologies, the clinical advancement of XmAb candidates, as well as royalties from sales of approved products. There were no COVID-19 impacts to partnering revenue that we were aware of during the first quarter, but we'll continue to monitor potential impacts, of course. Last quarter, we disclosed that we had entered into a licensing agreement with a privately held company, which remained undisclosed at that time. Now, we can disclose that this company Zenas BioPharma, a new cross-border company developing immune-based therapies for patients in China and around the world. We granted them worldwide rights to develop three pre-clinical programs, incorporating XmAb Fc domains for development in autoimmune diseases. We received a 15% equity interest in the company and are eligible for royalties. We also entered a new academic collaboration last quarter with UCLA to extend the use of our XmAb technology. Pairing novel targets proposed by scientists at UCLA, and Xencor's [modern] suite of XmAb technology platforms. What we've done is establish a framework with predefined terms to enter sponsored research agreements and potential license agreements, to streamline and expedite any potential drug candidates that are selected for further development. UCLA agreement is our third collaboration focusing on novel target biology to create a new generation of XmAb bispecific antibodies. Joining those we've entered Atreca and MD Anderson. Now with that, I'm going to call over to John Kush, our chief financial officer, who'll review key highlights from our first quarter financials. John?

Thank you. Xencor's broad protein engineering platform or resulting partnerships and collaborations continue to generate revenue and provide value to support our core portfolio of clinical and research stage by civic antibody and cytokine drug programs. Cash, cash equivalents, and marketable investment securities totaled $577.1 million as of March 31st, 2021 compared to $604 million on December 31st, 2020. The decrease reflects royalties and milestone payments received related to licensing agreements, net of cash used to fund operating activities for the first quarter. Based on current operating plans, we expect to have cash to fund research and development programs and operations into 2024. And we currently estimate that we will end 2021 with between $425 and $475 million in cash and cash equivalents.

Total revenues for the first quarter were $34 million compared to $32.4 million for the same period of 2020. Revenues in the first quarter include revenue related to our Janssen collaboration, milestone revenue recognized from Morphosis, and the royalty revenue from Alexion and Morphosis. Compared to revenues from the same period in 2020, which were primarily milestone revenue from Morphosis, royalty revenue from Alexion, and licensing revenue from our [inaudible] and Gilead collaborations. Research and development expenditures for the first quarter were $41.4 million compared to $33.9 million for the same period in 2020. The increase is primarily due to increased spending on our XmAb 306, XmAb 564, and XmAb 819 programs. General and administrative expenses for the first quarter were $8.2 million compared to $7.2 million in the same period of 2020. The increase primarily being related to an increase in staffing.

Other income for the first quarter of 2021 was $13.2 million and included a gain of $12.9 million in equity received in connection with the licensing transaction, compared to $0.7 million for the same period in 2020, which was primarily net interest income earned for the period. The net loss for the first quarter was $2.5 million or 4 cents on a fully diluted per share basis compared to a net loss of $8.1 million or $0.14 on a fully diluted per share basis for the same period in 2020. The lower net loss reported for the first quarter of 2021 compared to the net loss for the same period of 2020 is primarily due to other income recognized from equity received in the first quarter of '21 in excess of increased spending on research and development expenses for the period. Non-cash share based compensation expense for the first quarter was $8.3 million compared to $6.5 million for the same period of 2020, and total shares outstanding were 58.2 million as of March 31st, 2021, compared to $57 million as of March 31st, 2020. With that, we would now like to open up the call for questions. Operator?

Thank you, sir. (Operator Instructions). You have your first questions from Ted Tenthoff of Piper Sandler. Sir, please ask your question.

Great, thank you very much. And thanks so much, guys, so much exciting stuff going on. I'm wondering whether or not we should anticipate an update for the Roche program for IL-15 this year. And also, just going back to PD-1 CTLA-4 717, we won't be getting prostate cancer data, but what other cohorts could we expect from that this year? Thanks so much, guys.

Hey, thanks Ted. So regarding our XmAb 306 IL-15 program, that's the oncology collaboration with Genentech. We are discussing a publication plan with Genentech. We don't have specific guidance for timing of data this year. I will point out that the dose escalation in a broad range of solid tumor patients continues monotherapy, which was started last March, as well as the, we're continuing the dose escalation as a combination with atezolizumab, their PD-L1 molecule, which started in Q4. So those are ongoing. We'll come up with guidance. Once we have agreement with Genentech on the publication plan, as well as, of course, keeping people abreast of any additional study starts that happen over the next year.

With regard to XmAb 717 or PD-1 CTLA-4 molecule. Yeah, there are going to be additional cohorts that we disclosed data for from the expansion cohorts of the phase 1 study. So in addition to a much more mature data set from our prostate cancer cohort, we'll have a more mature data set. It was only partially enrolled for our renal cell carcinoma cohort, as well as more mature data from our basket cohort of multiple tumors that are not in PD-1 approved indications. So we would expect all of that in the second half of this year.

Awesome. Thank you so much. I'm excited to see IL-2 go into the clinic too.

Yes, we are too.

And speakers, your next question from Mara Goldstein of Mizuho Securities. Ma'am, your line is open.

Great. Can you hear me?

Yes.

Awesome. Thank you. So I wanted to ask two things. The first is around the strategy of converting that phase 1B in prostate cancer to phase 2 and what you will achieve by that. And then, the second is around the cytokine strategy. I mean, clearly we're seeing the beginnings of a lot of early work with novel engineered cytokines and the like, and so, I'm just curious as to sort of what you're thinking from a competitive perspective and a competitive advantage using the XmAb technology as you are versus, let's say, engineered cytokines and other fusion proteins and the like.

Yep. So I guess on the first question that the shift of XmAb 717 PD-1 CTLA-4 study in prostate cancer that multi -- that basket study, why shift from a phase IB to phase I? My understanding, and Allen, you should pipe in here, was that it was simply a better reflection of what the study actually was doing, given that we have the go-forward dose we selected for that study, merely that. Anything to add, Allen?

Yeah, no, it is a little bit of nomenclature. Remember, a phase IB could be looking at combination. So we had already sort of disclosed that this will explore 717 with sort of key combinations of either chemotherapy or targeted agents. And whether you call that a phase IB or a phase II with a safety run? And I think a phase II is a better accurate description. We sort of know our dose. We know the combinations we want to try, and we're really looking for a signal in certain sort of molecular subgroups or clinical subgroups of prostate cancer. So it's more reflective of phase I and planning to go to an eventual phase III.

Yeah. Now on your second question, Mara, for the cytokine, the strategy we're taking for this really rapidly evolving and growing field of engineered cytokines, I'll maybe ask John Desjarlais who's actually on the call here to answer questions, to chime in about how our design strategy has some commonalities for how we're looking at all the cytokines and yet how we're tweaking it for the individual ones. We agree, it's a really exciting area, which is why we're committing a lot of additional efforts and resources there. John, you want to get in here?

Yeah, sure. Mara, when we first tackled IL-15, we went in, we fused IL-15 to an FC to make a long acting cytokine. And we made a critical key discovery that natural cytokines are limited in their ability to stay around very long in circulation. And so, the solution we came up with was to decrease the potency fairly dramatically. And in doing so, we found out that we actually make a much better drug. It lasts a lot longer in circulation and because it can last longer, even though it's lower potency, can actually mediate its pharmacology for a longer period of time. Also, the fringe benefit of that reduced potency was much better tolerability and much better control over toxicities as you dose escalate. Now we turned it around and applied that same concept to the IL-2 program, our Treg expander, found exactly the same result that we got dramatic improvements in pharmacokinetics and pharmacology when we reduce the potency. So far, that seems to be playing out really nicely with the IL 12 program as well, as we detailed on our ACR tester. So that's the unifying theme, which seems to be pretty unique in the community, is going with longer acting, lower potency molecules.

And speakers, your next question from Peter Lawson of Barclays. Sir, your line is open.

Thanks for taking the question. Thanks for the updates. And just on IL-2, when did we see data around that? And how do you think about picking particular tumors and combination partners?

Oh, well, our IL-2 is targeting activation of regulatory T-cells. So that's our program focused in autoimmune disease. Our IL-15 is the one that is the collaboration with Genentech, is our play with the cytokine for activating T-cells along that same pathway. So do you want us to talk about the IL-15 or do you want to talk about the 564 program?

I'm just curious if you're thinking of moving that IL-2 as well into oncology or...

No, no, we don't have any intention to do that. Its biology is really tuned, as John said, well, it's tuned for potency. But in addition for that IL-2 molecule, we actually took the direction, like some other companies that are looking at the same approach of increasing the relative binding affinity to the inhibitory, well, to the receptor that's more prevalent expressed on regulatory T-cells, the IL-2 alpha receptor. So we really feel that's much more appropriate for autoimmune indications. We haven't yet guided specifically on when we expect to have data from the single ascending dose. Essentially, it's a biomarker and safety study. The initial work in the clinic with that molecule could be later this year, but we'll guide specifically as we get a little further into this study. We just opened the study about a week ago.

Right, thank you. and then the B7-H3 construct. I think you talked about that before, just curious where that is and where you're thinking of positioning that construct.

Yeah. I'll touch on the timeline, and then if John wants to jump in on how we're positioning it. That molecule, we hope to have in the clinic in 2022, it's in active pre-clinical development now, with all the requisite manufacturing scale of activities just getting started.

John?

Yeah. In terms of thinking about applying that, the reason we selected B7-H3 as a target is it's very broadly -- they're very brightly expressed across a range of solid tumors. And we wanted a molecule that we could use to target tumors, get tumor-specific CD28 co-stimulation, which is your signal two.

And then you could use that to build on whatever signal one is being provided. And that signal one could be provided either by just natural T-cell reactivity against neoantigens in which case you'd probably want to be exploring that our B7-H3, CD28 in a P-1 combination study or signal one could come from any one of our T-cell engagers, our classic CD3 bispecifics in our silent tumor pipeline, the first of which will be an ENTP3 by CD3.

And I guess beyond that, I would also say B7-H3 is a particularly interesting target in prostate cancer. It's very bright there and we, of course, would want to explore that in prostate cancer, as well.

And speakers, your next question, from Alethia Young of Cantor. Ma'am, your line is open.

Hi. Hey guys. Thanks for taking the call. This is [Lee] on for Alethia. We just have a follow up on the IL-2 program. Since you just recently started the trial, can you just talk a little bit about how your molecule is differentiated from others in the space, and what advantages that you expect to see in the clinical setting?

Right. The design follows the rule of our cytokine engineering that John sort of laid out, which was, it's taking the natural IL-2 molecule and making mutations in it, to dramatically dial down its potency. I think we're north of a hundred-fold less potent than wild type IL-2 fused to an Fc domain.

Now, the things that make this particularly well-suited for autoimmune disease is, our protein engineers biased the binding to actually have a significantly higher ratio of binding to the CD25 or IL-2 alpha receptor, than to the IL-2 beta gamma receptors. That receptors is heavily expressed on regulatory T-cells to bias it towards Tregs.

So, how do our designs differ from the -- What's the positioning? We hope that our dramatically lower potency, as well as our Fc domain, which contains our Xtend technology, gives us an enhanced therapeutic window. We won't know until we see. And that we can get excellent Treg amplification.

John, am I'm missing anything on -- Oh, and maybe John, if you want to comment on the monomeric IL-2 nature, and how that's distinctive in the industry.

Yeah, no, that's a good point. We designed ours using our Fc heterodimers, which enables this. We designed ours to only have a single IL-2 for the Fc domain whereas competitors like Amgen, or other efforts, have a bivalent Il-2.

We think having the monovalent IL-2 actually helps reduce internalization through receptor binding. That's kind of a classic paradigm in terms of biologics and internalization.

The bottom line is, again, we applied our potency reduction, monomeric IL-2. We would hope that we have highly competitive, or even best-in-class pharmacokinetics and pharmacodynamics.

Okay, great. Thanks. I have another question on your IL-12 program. I know it's preclinical, but just curious how you're thinking about designing a molecule that can potentially address the narrow therapeutic window here. Thanks.

John. You want to take that, I guess?

Yeah, sure. I'll take that. You can see a pretty nice story about this on our ACR poster. We found, again, that the potency reduction gave us much better control. When we put the IL-12 potency-reduced version into monkeys and compared it to a wild type IL-12 Fc fusion we found that as we dose escalated in nonhuman primates, that we saw much more gradual onset of a key pharmacodynamic marker, which is IP-10, which is downstream of interferon-gamma. That's what IL-12 famously does. And so as we dose escalated our potency-reduced version, it was a much smoother ramp-up on that pharmacodynamic marker by comparison of a wild-type IL-12 Fc.

And what that tells me is we're going to have a much easier ride when we dose escalate, because we've got much better control over what's actually going to go on in the humans, when we use this reduced potency molecule.

So, that's what we have so far. That's what the preclinical data suggests, but obviously we're going to have to see what happens at the clinic.

And speakers, our next question from Etzer Darout of Guggenheim. Sir, your line is open.

For the XmAb 564. If you see the appropriate therapeutic window, do you have any thoughts on how maybe the low-hanging fruit indications, if you will, or maybe interesting indications that you could pursue initially? Obviously assuming success. And then I have a second question.

Yeah. We're not guiding on specific indications we're selecting yet, though we're hard at work putting ourselves in a position to hopefully start them as soon as we come out of dose escalation. Of course, there's a multiple-ascending dose escalation component to the study that'll start after the SAD. We think there's a lot of opportunity for these novel mechanisms of action, like Treg innovation, in some of the smaller auto-immune indications. And so we're certainly looking there, but I think when you look at the competitive landscape in some of the larger indications where there's still open room, we think a lot of our competitors have already hit those. So, more to come on that. We are working hard on that.

Now, did you have a follow up question?

Got it. Yep. Just a second question, on the initiation of the [inaudible] study. Based on the intro remarks, is the data from the ongoing phase one, if you will, the main hurdle to getting that started, in terms of the timeline variability that you described?

I think it's pretty coincident with the operational pieces, as well. We hope they'll all come together. We are dosing at Q2 week now, with a Q-weekly run in period, much like we've seen from other programs. So, squaring that away is ongoing, and we hope to have that data present late this year, like we guided. And hopefully start off the phase two.

Great. Thank you. And congrats on all the progress.

And speakers, our next question from Tom Shrader of BTIG. Sir, your line is open.

Hi, thank you. Good afternoon. Thanks for the update and taking the questions. For 564, what is the theoretical safety concern from too many Tregs?

I don't know if it's from too many T-regs, I think it's a combination of being non-selective and having lots of T-cells, period, amplified, is the problem. That can cause your usual capillary leak syndrome, cytokine syndrome, the toxicities that are seen with IL-2 therapy, with proleukin. So you just need to control that from coming on too strong, whether it's the T-regs you're amplifying, or T-effectors.

So in other words, it'd be classic immunity --

Go ahead.

Another way of saying it is, we optimize selectivity of our IL-2 for Treg, but there's no such thing as perfect selectivity. So at some point, if you dose high enough, you're going to start tickling effector cells and other cell populations.

And to just dig in a little bit to the last question. This molecule could, in fact, play many, many spaces. Do you think your likely first trial would be something like psoriasis, where you get a clinical readout very quickly, and then you'd be confident to try many other things? Or do you think a good biomarker signal would be enough to go into more challenging applications?

Yeah, it's a great question because that's something that, with many programs, we mull over, and I think people around the industry mull over. Do you want to get some kind of disease modification signal, even if it's an indication that is not necessarily a great development path, because of competitive density? Or do you trust the biomarkers?

I think that the thesis around Tregs' role in modifying disease activity is one risk that most companies seem to be willing to take, as long as you can get the good biomarker movement. I mean, you know what you're trying to do, how that plays into disease, I wonder if, even if you proved it in something like psoriasis, which is probably a tough hill to climb from a development and a competitive standpoint. Even if you showed disease-modifying activities -- And I don't know how well it would translate. So I don't know if Xencor really favors that approach, as opposed to, like many of our competitors, looking at the Treg counts and the other T-cells as the biomarker, that's really definitive for a go signal.

And speakers, our next question from Zhiqiang Shu of Berenberg. Please ask your question.

Hi, good afternoon. Thanks for taking my question. I have a few.

The first one, on 717, you said that you're going to move to the combination trial in prostate cancer. What kind of combinations are you thinking to potentially move to, to treat different [set] groups there? That's the first one.

We're not saying explicitly, I think -- and Allen, jump in if I'm missing anything but depending on the subtype and what's known about how they respond or don't respond to treatment, they will include both chemo combinations as well as some targeted therapies.Able to include both chemo combinations, as well as some targeted therapies that make sense for certain molecular subtypes. I don't know if we can say more than that, Allen, right?

Yeah. I think it's fairly obvious. There's some targeted agents that have been approved for prostate cancer like PARP inhibitors. And then the chemotherapy is still used in a certain aggressive type as well. So those subtypes you would have to combo with checkpoint inhibitor, and so obviously we're going to explore those.

Got it. And then I'm just curious about the twenty-eight dollars you hear. What's I guess broadly, what's the difference between CD28 bi-specific versus CD3 bi-specific from I guess safety and efficacy standpoint? Is it more, yeah-

That's a long question. John, why don't you try, I mean, I guess you could briefly go ahead.

Yeah, that's a great question. You know, so this, the CD3 is kind of a bigger hammer, right? So CD3 is signal one on the T cells and it's, it's not, it's not specific to any, any particular T cell population, right? The point of a CD3 is to grab any G cell in the acidity and, and mobilize it against the tumor. And so of course, that's, that's going to be a little bit more challenging in terms of safety profile either in terms of CRS, but also in terms of just on target off tumor toxicity. With the CD28, it's a pretty intriguing concept because it's providing the signal 2 which can amplify a signal 1, and then it can build off of a signal one that's coming elsewhere.

Right. And like I was saying with one of the earlier responses, this signal one could come from an endogenous T-cell reacting with a tumor cell, and now you're adding in that signal 2, with the CD28 and amplifying that natural. And dodginess T cell as a tumor response or signal one could come from a CD3 bispecifics, and you could combine the two. And so we're obviously contemplating both approaches.

Got it. Thank you. Final quick, one on six, six, nine, eight CD3 CD 38, a molecule, I guess, where do you see this monitor go in, in the future development?

So, right now, we're following the lead of some investigators who were enthusiastic about a CD38 CD3. You know, we'll note that Amgen decided to jump out of development. And really this was a molecule we had enabled with our technology, but it hadn't actually made for them. They just took our various building blocks and put them together for CD3 CD38 and FC domain. And in myeloma, they felt that the AE profile wasn't consistent with a go forward -- to go forward with it, we'll say that without disclosing, until we've got the trial up and running, there are other hematologic malignancies that express CD38, where the tolerability profile might seem quite reasonable in, in that context. So more to come on that.

Great. Thanks very much. Congrats on the progress.

Last question is from

Arlinda Lee from Canaccord Genuity. Ma'am your line is open.

Yeah. This is Ben calling in from Arlinda. Thanks for taking my questions and a lot of them have been answered. I just wanted to ask a few on that 717 in plamotamab. A few PD1 CTLA 4 programs have data that have been presented at this point. And I'm just wondering regarding 717 how's the safety looking versus nivo versus an IPI combination regimen. And what do you guys ultimately hope to show in the data?

I guess I'll answer the first is the first one. What do you hope to show in the data. We have to share that in that we can find it indication or we can make a difference for patients, whether that's in a relapse refractory setting. Like some of the areas we're looking at are even more exciting, we think is in areas where there aren't checkpoints approved, where the combination of MOS and the tolerability profile, the combination of CTLA 4 and PD 1 can move the needle that hasn't been moved before. And I think prostate cancer is a great potential example there regarding the safety profile we observed so far, I'll let Allen take that question.

Yeah, thanks. So it's fair to say that the nivo IPI combination is probably more effective than PD 1 blockade alone, but clearly you get a lot of toxicity. Only about a third of patients remain on study past a few courses. So the most common toxicity is colitis. This is the most common toxicity to me, the most common toxicity that leads to interruption or discontinuation. And so we haven't seen that high frequency of colitis. You know, we believe that the indications is valuable, alluded to is where PD 1 plus CTLA 4 has been shown to be synergistic. And perhaps you haven't seen that much improvement activity, prostate cancer is a classic example of that.

Okay, great. That's very helpful. Switching gears to plamotamab. And I understand that Morphosis might be driving a little bit of the bus here. It's a competitive space. And I'm just wondering, how do you think of plamotamab in a competitive positioning, and then maybe can you comment on what you think the development strategy will be? Do you expect, maybe data in 2022 at some point?

Yeah. So I'll take that one. So the position for Plymouth, you're right. It's a very competitive area. in an already competitive indication in, in lymphoma. And we think that the approach we're taking is recognizing that competition is going to be hard and that we need to go with something that is really combining the two most active regimens we can, that has the best scientific rationale we can think of. And to see if we can go for the best approach, sort of the best combination approach to that. And this is a key point is chemotherapy free a direction the field desperately wants to move in and lymphoma just like as has happened in, in leukemia based on the success of [CLL,] (inaudible) and Venetoclax used with antibodies. So the plamo tappa len combination is -- tappa Lenalidomide is the most active and a very durable combination therapy in second line and later aggressive lymphoma.

It's a well tolerated regimen and it uses orthogonal mechanisms of action to plamo to a CD20 CD3. Its effector cells, innate effector cells driven by the FC technology that we put into TEFRA, cinema and CD 19 binding. So a different target also than a CD 20 CD3. So it really seems like a really totally perpendicular mechanisms of action that hopefully can compliment each other. And so we wanted to combine with the most active agent that was really tolerable. So that's our strategy. It's going for a chemotherapy free regimen that could be super active and that's how we hope to distinguish.

Okay, great. So that would be a simpler regimen than existing regiments right now.

Well, hopefully, they get more tolerable and without the chemotherapy type of toxicities, which can often include long-term toxicities and secondary malignancy risks and there's a whole host of others. Go ahead. Go ahead. Sorry. Before you, before you go onto another one, Ben.

So yeah. You know, maybe I can add some color. Yeah. Maybe I add some color. So, the strategies have been sort of declared by our competitors, right? So there's two chemo regimens that are often used for the second line. That's either Gemox or bendamustine, Rituxan, and the strategies that our competitors are using are either to compete against that directly as a single agent or add on to that regimen. Like Gem-Ox, as Bassil alluded to our strategy is, is sort of a little bit different tap a cinema, at least in the transplant ineligible population has been already approved for that second line indication. Right. And so now we're adding our CD 20 to their CD 19. And then of course, lenalidomide potentiates the CD 19. It could potentially potentiate the CD 20 as well. So, that is the sort of differentiating approach. So we think our approach is vastly different from the others.

No worries. I'm sorry to interrupt you. And so data readout, do you think might be in 2022 or maybe later?

We're not guiding on that yet. We want to get the trial started, then we'll give specifics.

Thank you. All right. Well, I guess if that's the last question we'd like to thank everybody very much for joining us today, hope you have a wonderful rest of the afternoon and we look forward to catching up again and getting further updates on our progress throughout the year. Thank you.

This concludes today's conference call. Thank you all for participating. You may now disconnect.