Q4 2019 Earnings Call
[music].
Good morning, everyone and welcome to the select as the fourth quarter and full year 2019 results conference call. At this time, all participants Arnie listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time. Please be aware that today's conference call is being recorded I.
I'd now like to introduce the first speaker Simon harness.
So like the vice President of corporate strategy and finance you may begin Sir.
Thank you and welcome everyone to select the fiscal year and fourth quarter 2019, corporate update and financial results Conference call.
Joining me on the call today with prepared remarks are Dr. Andre Shoemaker, our chairman and Chief Executive Officer.
Thank you, Tony our Chief Financial Officer, and Dr. Francisco.
Vice President clinical development.
Yesterday evening select that's filed its annual reports on issued a press release reporting our financial results for the fourth quarter and year end at December 31st 2019.
The reports and press releases are available on our website at selected Dot com.
As a reminder, we will make forward looking statements regarding financial outlook. In addition to regulate <unk> product development plan.
These statements are subject to risks and uncertainties that may cause actual results could differ from those forecasted.
Description of these risks can be found in our most recent form 20-F on file with the FTC.
I would now like to turn the call over to Andre.
Thank you Simon.
Good morning, Thank you everyone for joining us today.
Twice to 19 has been a year of strong execution for select.
Today.
I'm proud to say that to our truck with the clinical development of the three wholly controlled allergenic car T cell product candidate.
Well.
We partner product candidate.
Your car T C S. One in relapsed refractory multiple myeloma.
You card 22 in relapsed refractory B L out and you card 123 in a relapse refractory AML.
Oh wholly controlled product candidates and currently in phase one dose escalation trial called respectively.
Now when these erewhon valleys, erewhon and ammo easier war.
These studies are designed to assess the safety and optimal dose for each product candidate in three to four different dose cohorts.
When available we're planning to share this dream data set on these programs.
And second half of this year.
An additional near term value driver for like.
Is due to licensing agreement, we have in place without allergenic car T cell platform with two world class partners.
We announced yesterday with Turkey.
The execution of the amendment confirming the terms of the term sheets side on February 18 2020.
Under this amendment selected grants to survey and expanded exclusive worldwide life and to develop and commercialize in allergenic car T cell product targeting CD like tier.
Including allo five or one.
Our fiber one a product candidate.
We're excited about increased focus by our partners Terry and it.
You asked Sublicensing I will check therapeutics on the pioneering new car T <unk> program, and yellow and expansion into de LBC outpacing.
Part of the amendment selected is entitled to receive an additional $27 million upfront payment.
To $410 million in pre commercial and commercial milestone as well as a flat low double digit royalty on sales of to license product.
While providing selected an attractive economic upside to the product candidates targeting CD 19.
And then significantly enriches our proprietary portfolio of targets with five additional differentiated car T cell targets in both solid and liquid tumors.
Our proprietary gene editing platform provides us with a vast amounts of new opportunities in the ever expanding cell therapy arena.
We have recently made the selective decision to Parker with Io offense buyer therapeutics to use our pailin technology to dip loved United the tumor infiltrating lymphocytes.
For cancer Therapeutics.
An area, where we see tremendous promise is an opportunity.
Were looking forward to share more of this exciting new development program and the future.
Having had with our increased clinical development, we're seeing strong expansion in the manufacturing effort into cell therapy space.
Here there are two main trends first.
No how.
Is the key proprietary active in this industry.
And second.
We have seen strong trend for consolidation.
As a result, so like this has taken the forward looking decision to fully integrate its manufacturing expertise.
The key strategic asset for to copy.
In March 29.
We announced our lease agreement for an 82000 square foot commercial scale manufacturing facility in rally North Carolina. This new five being designed to block GMP manufacturing for clinical supply and commercial manufacturing upon renewal.
<unk> approval.
We are on track with the build out process and the facility is black to be operational next year.
In addition to rally we have built a 14000 square foot manufacturing facility in Paris.
Which is designed to produce critical role and supporting materials supplies for the ongoing car T clinical studies and our future commercial products.
This facility is designed to help us save significant amount of time and money into manufacturing process currently Don our CMO partners mold Mad and long term.
We believe this strategy will enable smooth transition target food manufacturing independent.
With that I would like to hand, the call over to Dr., Fred Cisco is Teva Vice President clip of clinical development, who will give you a quick overview of our wholly controlled clinical car T cell program.
As a brief introduction.
Let's see school is a medical oncologist within outstanding track record of peer reviewed publications with more Dan.
20 years of experience in drug development.
Francisco spent 16 years at MD Anderson cancer Center, and fixed fears and.
And why you leading clinical research programs in breast cancer and solid tumors.
Francisco join selected since October 20, <unk> team and the head of clinical development.
We are honored to have Francisco as part of our team and I'm excited about the positive impact he will have on our clinical development.
Francisco. Please go ahead.
Thank you very much on Andre Sundry mentioned, our first three appropriate sorry, allogeneic car T cell development programs, you've got the C. S. One you've got the 22 on your car T. One two or three are all in the first those cohort b.
For speaking about our clinical programs in more detail I like to explain our thought process behind a true seem to pursue C. S. One cdtwenty two on C.D. one to three I started we strongly believe that the potential addressable targets for Allergan Ache Kartik a car T goes far beyond.
On the current they know and clinical target Cdnineteen RBC at night.
In an independent study published in nature Biotechnology in January 2020, doctors Monica Guzman increased Mason and colleagues evaluated the therapeutic landscape for cells engineered with Kamerick antigen receptors. They created on interactive car clinical trial data base is panning.
64th quarter gets deployed in T cells.
Natural killer cells or mixtures.
From over a 500 clinical trials in 20 countries encompassing more than 20000 patients in this study the targets Cdtwenty two CD, one two or three as well I see as one which we chose not to have like this as our first appropriate started clinic our targets.
Our standing out as having the highest therapeutic potential among all the targets evaluated, especially cdtwenty, two which may have a higher potential I say target compared to CD 19 in b cell malignancies.
As we progress through the various at those cohorts, we're closely monitoring the on target onto more about us off tumor car T cell interaction.
Starting with your car T C S. One.
Following the I N D approve our in April 2019, we though start first basins in the Melanie Oh, one of phase one dose escalation clinical trial in October 2019.
The bases, we are enrolling presented with a very advanced disease or basis present, with relapsed refractory multiple myeloma and have progressed and multiple lines of prior treatment, leaving this basins with little to no alternative options.
Some patients had a parent bcm, a target that car T therapy, which either failed them or let the patients relapse our experienced so far so starting with our therapeutic approach, we could potentially help a lot of patients with such a high unmet need.
Starting with a dose of 1 million cells per kilogram. The second dose cohort would explore 3 million cells per kilogram on the third those with explore 9 million cells per kilogram.
[noise] for you've got the 22, we though start first a oh pace and in the Bali Oh, one clinical trial in December 2019, the body zero. One study is a phase one dose escalation trial evaluating you kind of P 22 for the treatment of Cdtwenty two positive.
Relapse or refractory b cell acute lymphoblastic leukemia or be a b L. L.
Enrollment in the phase one dose escalation clinical studies ongoing I supply and we are currently in the first dose cohort.
Again, the patients were enrolled in this trial are very sick they present with progressive disease, who have failed and all other available treatment options, including prior Cdnineteen directed car T cell therapies.
I'm Goldman criteria.
So for patients with very high expression of Cdtwenty two on this basis can be cdnineteen negative.
If successful <unk>, you've got to 22 could be an extremely valuable treatment option for relapsed refractory CLL patients as we do see that there is a relatively high relapse rate after one year of treatment with other therapies undergoing clinical trials in that indication.
This basis I'm not considered eligible for bone marrow transplantation. Our goal is to find a safe and effective those have you got to 22, that's kind of control the disease and ideally make patients eligible for transplant.
We're also planning on filing a protocol amendment with the FDA to evaluate the addition of all in this AMAP do they do for depletion regimen.
Selected invented the city's 52 knockout concept that is already incorporated in the current you Kinda Pete 123, you've got the 19 and you've got the 22 constructs to make them compatible with Alimta some of treatment.
We have the intention to evaluate the safety and efficacy of <unk>. Oliver. This is a MABA based lymphodepletion regimen in a separate cohort of patients to guide to the future development of your car T 22 therapy in Cdtwenty two positive B L.
This competitive evaluation might not start before the completion of the second cohort of the current about a zero one study.
We are currently dosing patients out there those are 100000 cells per kilogram. The second dose cohort would explore 1 million cells per kilogram.
Oh come into you've got the 123 in 2019, we introduced a completely reward your car T 123 construct without an optimized manufacturing process. These new product at once approved for testing by the FDA as part of a new I N D filing.
In January 2020, we announced the first patient dosing and I'm only a one the phase one dose escalation clinical trial evaluating our new your car T 123 product candidate in relapsed refractory acute myeloid leukemia. These new I'm a little one study reply.
So the first U.S. clinical trial assessing the first the version of your car T 123 product candidate.
Here to patient enrollment in this phase one dose escalation clinical trial is ongoing we are currently in the first the dose cohort of 250000 south per kilogram.
I would like to highlight the significant unmet medical need for this patient population.
Lots of refractory AML patients have a very limited life expectancy under currently there is no treatment no effective treatment option for these patients.
These patients do not currently qualify for a bridge the transplant approach to due to their refractory nature of their disease. If successful you've got the 123 could provide an opportunity for this bridge to transplant, which still is that going for any cell therapy in relapsed and refractory AML.
Yeah.
All three phase one dose escalation studies for our proprietary products are designed to find the safe and optimized therapeutic sell those.
Our primary endpoint is identified the recommended phase two those.
Without a secondary endpoints were exploring the product expansion persistence and anti tumor activity. Our defend those levels were excited about our clinical programs and we plan to share data odd upcoming scientific conferences.
With that I'd like to hand, the call over to Eric the town, where an overview of the company's financials.
Thank you Francisco I will provide a brief summary of the consolidated financials a facilities as a reminder, seductive is 69% share order of carried out publicly traded six year.
You can get the breakdown of the consolidated financials quick peep out on that I feel right between Cellectis and colleagues in the antibody T cell Oh fourth quarter and full year 29 key financial results press release.
I would like to focus on the city keys financial performance seems the Kelly management will present them to fall 2019 earnings right. After all these core.
First of all I.
I would like to eight you're right that we focused our cash spending at facilities on the putting objective.
From.
Developing our deep pipeline of product candidates, including the manufacturing and clinical trials of you've kept went to suite you kept 22 and you kept his one.
Second building out the state of the off manufacturing capabilities in Paris, and you know rally.
And finally, heightening, our manufacturing Pico department, including hiring talented personnel.
As of December study fell 2019, Citic teach without Kelly had korean onto that and $4 million now in cash cash equivalents, given find out what I said and restricted cash.
These cash position will be sufficient to fund Cellectis Thunder no passion into 2022.
The net cash them.
Which corresponds to net cash flows use by operating activities capital expenditure and these payments what 51 million turnout for the young 2019 of which 2 million no doubt net inflows in Q4, 2019, which was not every day.
To the receipt of a 5 million no doubt milestone payment from I know gene and $15 million <unk> R&D tax credits.
Revenues and other income well 16 immediately thought out for the young 2019.
Oh for $3 million really relate to to fall 2019.
R&D expenses increased by $12 million up to $80 million now for the young 2019 compared to 2018.
And Asia inexpensive decreased by $9 million up to $17 million for the same carrier.
Well parenting lucky's, well $83 million for the Yelp 2019.
Which $27 million is attributable to fall 2019.
Finally financial gains were $8 million up in the yard 2019.
To conclude I would like to say a few world about the consolidated financials.
The consolidated cash cash equivalents couldn't find I'm sure that said and they see cash position, what <unk> and 64 million started off as of December said he felt 2019.
The consolidated net loss attributable to shareholder acetic Keith what one other one $2 million out Oh 2041 cents per share for the Yelp 2019.
This we present, an increase of $23 million overall, 2018, which was mostly explained by an increase in consolidated operating losses.
The consolidated adjusted net loss attributable to share or don't have cellectis, which excludes noncash stock based compensation expense. He is.
What $79 million now well adored on 86 cents best share for the young 2019.
I will now turn the presentation back around to Andres for closing remarks alright.
Thank you Eric.
Twentytwenty if people year first selected.
As we progress through to clinical development of our wholly control or partner product candidates.
We believe we will start to show proof of concept on theories of partner for our allergenic car T cell product platform.
Hand in hand, with our clinical advancements.
We are on track with the construction of our in house manufacturing site.
Which are designed to deliver full independent.
Internal know how on the forefront of signs in gene editing and cell therapy.
In addition to our lead clinical programs, we have made significant advances on the R&D side to further establish selective position as a leader in gene edited South Terror Peafiel.
I would like to highlight two Bob published a major journal articles by our team.
Which continues to show our pioneering position in the field of Allergenic car T cell engineering based on our proprietary tailing gene editing platform.
In addition, we continue to be granted new patent.
And uphold trend issued patent that had been challenged in the gene editing space, including those using our proprietary gene editing technology tailing aswell as CRISPR related technologies.
These patterns further strengthening our leadership and competitive advantage by an investment into the future of these technologies.
We are thrilled.
To see our programs come to fruition as everyday gives us new hope for patients and critical me.
With this I would like to open the call for any questions. You may have operator. Please go ahead.
Thank you ladies and gentlemen at this time, we will be conducting the question and answer session. We ask that you. Please limit yourself to two questions.
He would like to ask a question. Please press star one on your telephone keypad. The confirmation told the indicate that your line isn't the question Q you May press star to if he would like to remove your question from the Q for participants using speaker equipment. It may be necessary to pick up your handset before pressing the star keys.
Our first question comes from a line of Chino Wong with Barclays. Please proceed with your question.
Thank you for taking my questions and congrats on that or the program progressed. So I have two questions regarding the new car 22, Alan choose map cohort. So the first question is more the biology question <unk> Andre So just wondering.
What is your view the.
Immune system, how much did you immune system, we need to maintain in order to have a good balance.
I see toxicity and the purpose of a foreign car T cells and the second question is regarding the LNG snap cohort why you know this additional cohort and why now I'm. Just wondering do you see a allergens data when you use low adults.
Well [laughter]. Thank you very much Jennifer these.
Excellent questions by the way.
So to answer your first question, it's extremely difficult to know exactly what is the ideal window.
For best better duration for a car T treatment today.
It's very interesting because there are like series of different way to tackle this and.
Within 2020 will have plenty of data that art will be coming either from us or Parker Servier Alan gene, but also from other companies such as precision by sign says or others. Using for example, an approach where the knockout beat that to my global in et cetera.
Through like Sears up way to do this and all these data are going to flowing what we can look at today is essentially the data that has been published either by colleagues car Ts.
And that shows the direct like really no correlation between the duration.
The Caribbean to persistent of the car itself. So there is not clear correlation between the two what is the best outcome. Most of the time is the deep this.
And of the activity of the car itself in a short period of time or more like the killing potential and the expansion potential of the car that is injected that would be directly correlated to duration of the terribly itself more than the persistence of the car for a long period of time.
Nevertheless, also it's something that block to investigate.
We've seen the data.
Yeah.
It has been obtain what is your car T 19 that.
We started but I'd be pursued by survey and allergy and currently that are using alimta, presumably is very interesting data and we think that this approach that we were created is very interesting we decided to have very.
Deep comparative study in there and our plan during this year is trying to tune up our.
Way to administer this type of.
Therapy to the patient in the best way in order to confirm to wait to administered this.
During the expansion phase that would that would happen next year.
And of course the window.
Of.
Lymphodepletion, we believe should be around like over 2020 days and should be around the month.
But if you want to implement for example are rebuilding strategy could be interesting eventually to expand this maybe to a couple of weeks more.
And we're excited about that.
The other on the other hand.
Maintaining also the lymphodepletion.
During this.
The spirit could be done essentially by of course like classical cycle of flu, though but also potentially by administering other type of drugs or maybe also modifying the car itself.
And answering totally this question is not totally very easy depends of the targets.
So 22 for example, or 19.
Just had b cells 123 go after millwood janitors, so could expand the time of the window larger than we expected because the milli progenitor is one be able to able to rebuild for example, the immune an immune response.
Yes, one is present on t. cell b cells, NK cells et cetera. So the my deep in the Lymphodepletion, while expanding so all these question we need to answer.
And you know we're still in the first flight cohort for for 22.
And it's.
It's a exceed currently like we'd like to move forward with does.
And as we'd like to move forward with this we decided to file this amendment right now, but it should take place probably second half this year in order to be able to make a comparative study that deliver more insights on the way to precondition to basin, the best way to do it on the safety and if.
We could see side. So there is a leveling behind this that should be done and as we have all the potential to do this because we like Cdtwenty two is that like your cost when you do it cdfifty two enable foods like resistant to Alemtuzumab.
Decide who studied parallel study between like.
A cohort with a record without would give us very very insightful data and would allow us to move forward would probably the best dosing strategy for the expansion.
Thank you.
Thank you for a question. Thank you. Our next question comes from the line of Michael Smith with Guggenheim Securities. Please proceed with your question.
Hi, This is kelcy on for Michael Thanks for taking my questions first I guess could you just remind us the implications of the patent that with upheld by the European patent assets and maybe next that's there and then also I guess all the following up on the Lymphodepletion and is there potential too.
While you wait just alimta demand and when I think I flew altogether and would you maybe consider filing a similar protocol amendment for you quite went to three or is the plan still.
Ill, maybe not do that thanks, so much.
Well to answer your second part of your question.
None on order like we're not rolling out probably like were well have to start with something we're starting with 22 will certainly we'll try the same way is 123, it's it's very.
It makes sense to to make parallel studies because the two every car and every target behaves differently.
So it had to be assessed so for now we're starting with 22, we'll do it was 123, it's a systematic study of the Lymphodepletion condition will move probably all the parameters around.
That as I said potentially like the way to administer doses et cetera, we are talking with our partners also underway, they're doing it and.
I think the way to precondition to patient is probably a good guaranteed to success and as we have here.
An array of different parameter, we can play with it gives us a lot of opportunities and the better we make the study now the better the expansion will they be and a cleaner to shock to be allay will be idea.
To answer your the first question you have on the.
The patent that was upheld and Europe. It's.
Essentially to use of.
CRISPR related technologies, CRISPR Cas related technologies and same family in T cells to edit genes in general.
And.
This was we have like we have a patent in the U.S.
That has been granted covering this technology and a pattern in Europe in Europe, you have a procedure that is cold.
Tend to be take place before the end of period.
In Europe, which is one year period, you file an opposition.
Our position were was filed against this patent and the patent was upheld unchanged and.
We're happy about this outcome because it shows that we have been.
Very early inventors on the use of crisper and T cells very early stage, we started using CRISPR in T cells, because were gene editing geeks. So whatever new technology comes we usually try to use a tweak it et cetera and.
At the time, we're using that as early twenties 13 it was.
There was no.
Real idea of using Chris bring T cells and Weve been very early stage in doing this.
And.
We got the same pattern in the U.S. and we continue.
Like developing this technology and filing patents.
With it and.
You will see that in the future select this will strengthen our position in there and.
Nevertheless, we compare older technologies, so far with using tailwind for precision efficiency and safety reason.
But CRISPR is a very attractive technology for example for research we believe and.
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That has some limitations.
Compared to dealing for example concerning moms are combination term efficiencies et cetera, and things that we're working on till today.
Great. Thank you.
Thank you. Our next question is from Amanda Murphy with P.T.I.E.G. Please proceed with your question.
Thank you good morning, actually had a question, yes, one and I, maybe reading and that's all that seem Upsells forgive me if I am I thought last what are you sad that you wouldn't move.
<unk> cohort one if you aren't seeing African <unk>.
And I think I think there's I don't know that's 20 days between patient wanting to but center so until that one I reading too much into that there.
Isn't that comment that you know if you didn't see efficacy with me live.
The into color too.
Francisco, Duke you'd like to answer this question. Please.
Yes sure.
Yeah. We are that's finish in the the first cohort and then we'll move to two to the second one, but we need to wait a 28 days to make sure. There are no dose limiting toxicities. So that's a their core is going on as planned.
Okay.
The other calls habits around E. The Alibaba one no.
And then signed a debate in like a high level increase as a part of the renewal or.
And then and it stops me 50 in terms of pre clinical and I think you might as well how much have you received thus far and I'm curious, how we should expect that to try and not just especially with Allergan has talked about having a data read out coming up here and that in the middle here.
Well, we we have not disclosed exactly the amount of received so far but it's not quite easy to make the calculation because it was disclosed as most of our filing but we have not given the full number.
[music].
It goes back to 2014, it was big milestone the repayment plenty of 15, and the funny 15 and series of milestone the repaid during 2017 2018 and.
And that and 29 team.
We.
Strongly believed that this product.
Is set to go for BLE in series of different indication as we said be allowed for pediatric and adult which was conducted through to power and calm studies by survey.
With the deal detailed study that is conducted with bi alloy gene on Aloe fiber, one and now five on a and we think that this.
Procon also go and other type of indications also so there was an array of options that are covered by your car T 19, It's the first in class and I believe also the best in class product and this computer as an allogenic car targeting cdnineteen and the partners we have our.
Pushing this on.
Very in a very strong way. So we are very confident that this product will have probably the market again.
And that it would provide us was.
Sure as a fast on pay to the company its.
Definitely world everyone's.
Willing on the partnership side that we have.
So there is $410 million of Muslims are supposed to be paid on your car T 19, like an cdnineteen targeting journal and also we did receive a 27 million the doesn't upfront yeah in March 2020.
Yeah, and also that lower.
Certainly higher royalty right somewhere around 10% like assets.
Yeah, and plus it flat now which is good.
Okay.
All right. Thank you so much.
Sure. Thanks.
Thank you. Our next question is from Jim Birchenough with Wells Fargo. Please proceed with your question.
Hi, guys. Congratulations on all the progress a couple of questions. So first just I'm wondering if francisco can comment on implications of Abbvies failure with their C. S 180, see whether you think that has any implications for the target itself. Do you think that was drug specific and how do you think that affects your approach would you carts.
Yes, one and then second question is just on manufacturing in with the planned expansion to the GMP facility. How will you be supplying to partners is that hovered in the existing agreement or is there an opportunity to amend.
To provide more supply to partners with the expanded capabilities. Thanks.
Yes, Hi, this francisco so regarding the AIDC force. He has one obviously, it's a different approach the car T. A is much more I'm supposed to be much more a potent in our way once.
It finds the the target, but obviously, it's something we're watching very carefully and ER will it's hard to tell just trying to compare the AIDC approach to the used car T. Obviously would like to see better good responses with.
AIDC type of therapy in terms of validating that target, but are we still believe she is one is an important target in multiple myeloma, especially after patients have received progressed through busy I made therapy is considered one of the best targets regardless of these clinical trials.
Oh destination.
Well my say something Francisco on the same question from Jim Hi, Jim.
Yes, one.
Works with a monoclonal antibody, but have difficulty was the by spec.
And let me tell you our analysis for this.
For example, you car T S. One we have to edit out.
From the T cell C. S. One unless you would induced fratricide, killing.
Because yes, one is expressed on the surface of T cells.
So the problem is that the buyback if it's a cdthree on one side and just one on the other how would you buy the to the T cell.
And how the by spec would know exactly whats the T cell versus what's the cancer cell.
And.
So it makes a problem and it why it sounds a lot of the C. D, which is not great. You don't obtained problem when using more by antibody because the model Guy antibody, just and do the killing by ADCC.
Indicates a by spec it's problematic that's why we're very surprised that abbvie has pushed to buy back there just because like the the buyer I don't know what to buying on the diesel with the BCS won or Cdthree.
That's very helpful. Andre and then just one the manufacturing questioning whether you can leverage the expanded capabilities with your partners.
Well, it's not our plan currently the plan is.
More too.
Leverage our manufacturing capacity on our side and Alan Gene you know they have like 125000 square foot.
Building and.
In California in California, We're building a manufacturing plant also and were intend to build.
There are so many things to be built out from this plan because here we're talking about our three car T is we're looking for proof of concept, but standing in line, we have like a full pipeline of things that are in there. So.
Yes.
At the end, we have like a positive outcome.
One or several of these trials than it would be kicker to series of different type of for the pro product that we would like to develop and I'm wondering if our capacity would be enough all only to fuel.
Our pipeline so no for now we're only going to use the in house So no service.
Great. Thanks for taking the question all the detail.
Thank you Jim.
Thank you. Our next question is from Salveen Richter with Goldman Sachs. Please proceed with your question.
Hi, Thanks.
This is Andrew.
I'm just wondering if you could provide a little bit more color on your announced partnership.
And particularly some color on the structure of the agreement and just a big milestones that you anticipate receiving thank you.
So I'm anyone who wants to take this one.
Yes, absolutely and we're very excited about the I Evans partnership I, we are going to share a much more detail about this as we're getting closer to an eye Andy.
It's been a partnership that has been going back actually over a year already we've been working a as part of a research agreement that then transformed into a full partnership.
And when the time is right, we will share more about that as well as economics.
Thank you.
Thank you. Our next question comes from Christopher MRI with Nomura. Please proceed with your question.
Hey, good morning. Thank you for taking my question I was wondering if you could further elaborate oh on your ongoing dose finding study for each of the three products.
You know.
It seems reasonable to me that each one of these products is gonna be active.
And in some of that activity might be tied to some.
Successfully.
So I'd be curious to understand quantitatively.
How you arc light determine that.
Safety activity balance for each of these compounds.
And then maybe how you look at the potential for reducing.
So I'll jump back in queue. Thank you.
[noise] I'm I'm going to take a bit of the question then I'll pass it to you or Francisco. So it's it's a very you know, Chris Hi, Chris and by the way. It's a it's a tough question. Because you know there is lot of question Mark on like the doses and even though.
When you talk with a lot, especially as such as like Steve like steep drop or others.
Is the most of the time as its you know it's a product that is expandable and size up to the size of the tumor burden people wonder if there was a real ddos you have the floor, but you might not have DLP yet it seems like it's it's difficult to know so.
Either you have an embedded toxicity.
With the product that you inject that is linked to the product itself. For example, you want to three hitting the multi progenitor. It's yes, one hitting the T cells and NK cells.
Versus linfen opinion for 19, or 22 et cetera.
That is like the embedded toxicity that is linked to it or something else I don't know lacking on target but of tumor side effect that you would get but the more increase the doors you might not increase the effect of it because you just see the patient was enough cells to induce or with spot.
John and you just have to know exactly whats enough self.
Induce the full response, that's why we're going to dose escalation then you might increase the dose to a certain point, but always obtain exactly the same result, again and the discussion we're having with our partners today that we've seen so far gold and the sense of having you know.
The floor or threshold that you hit work, it's becoming effective and under this it's not working really.
And there was a differential between also telogis and allergenic hearty it and the way they are used actually due to the freshness of the sell that you're using and yes, we're going to use actually the dose escalation and the way you were doing the older Preconditioning.
To try to determine the best.
Toxicity versus efficiency in term of tumor response, and I'd potentially behind this.
Is coming also to the way for example, this amendment that we're trying to file now is to try to expand maybe the window and like tune up with the window will painting in order to develop the strategy with the right. Those two do potentially a different type of.
Regimen given to the patient was potentially 123, I dunno ex those is given or maybe only one dose, but that the and the way too though the patient is something.
That will be determinant of the success of the drug IDN and each target will be a different story, it's not going to be easy to.
Set up at those darkly, maybe IDN will come up and say, Okay. I don't know, it's like 80 million starts per Cape are not all and Yukon was a flat those period per adult and flat those barrett for like a.
Pediatric, but so far we don't know that maybe a francisco we would like to add on this.
Well, yes. Thank you under its a very important question. Obviously is that the main endpoint of these phase one trials and this all of them being first in human trials safety is our main concern so I have to make sure the.
The they'll they'll saves so we're starting at a very low those and we make a it we're not may not see optimal responses until we go higher.
On that those but it is very important too to ensure it is it safe some of the toxicities will be related to the the product itself like Crs or when it when it works as expected so that should not be an issue, but fighting a though.
That is a safe effective and where we see car expansion. For example made would be a is what were looking for I suppose to a classic.
P. the maximum tolerated dose that which we may or may not see but it will be or it may be different from for each product. It's a target. So we're taking a very cautious approach I'm trying to move as quickly as possible within that dose escalation optimize the lymphodepletion.
And then find the that those but still too early to tell.
Okay. So it sounds to me that you're really looking to understand performance of the T cells.
You know in these dose escalation study. So so how many patients do you think you need to get comfortable with their performance in each of these indications or you know just to sort of declare your phase two dose and then how should we think that phase two trials are they going to be completely separate or will you want expansion trials.
From the based on these these phase one and then I would assume those expansions or these phase twos or are also designed to be a registration worthy. Thank you.
So its the number of patients it may range from two to four patients per cohort, they say base and a design approach called them to be ISO. So we are then it depends on where we see the optimal a those show you know in there for example in there.
Your car T. One two or three we had looking at the potentially for those levels in the other products that you kind of T 22, and she has one we're looking at the three at those levels and so.
So the number of basis again were made range from two to four usually in phase one trials. We use three enrolled three patients per dose cohort and then expand to another three they just had a little bit Oh play modified a.
Statistical design and once we find the right. Those then we'll move into.
Spansion and at the same time it started planning the registration trials, because we want to get more safety data on the expansion to make sure. What we're doing in their people thought of studies is it safe and that is part of the phase one.
Development, but we we will it start very quickly thinking about a registration trials as well.
As we do the expansion trials.
Okay, and then just in terms of thinking about.
The discussing your registration trial plans.
With the street, what kind of timing might we.
Oh anticipate.
For those types of updates thank you.
My last question.
All right. Thank you show the registration approach.
Has not been finalized yet we need to.
Get more data from from the on ongoing study, which says you know still.
We're actively early but based on what Oh, we've seen for a from a recent have the approvals.
There are basically two approaches either go with a.
Single arm.
Study, if we are for a particular indication and one of these three products, we see very active or responses in selected populations. For example, one to three positive refractory A.M., our cdtwenty two positive AOL and so on.
If we see a exceptional responses, we could get approval based on a single arm study otherwise we'll have to proceed with a controlled study and those would it be discussions with the agency.
Both the FDA and A.M.A.
Once we have a additional data, but both all options are on the table at the moment.
Thank you.
Thank you. Our next question comes online as long as she Lee with Ladenburg. Please proceed with your question.
Hi, Thanks for taking my question, maybe two quick question why this well into the map.
<unk> for provider for the color are you going to test different doses on into the map or just a fixed goes maybe base own partners experience.
Right.
Francisco maybe this one for you also yeah. It's a it's the on our first approach will just here's a single those a this is not a study to look at other than to sum up is just a slight modification of our current lymphodepletion regimen. So if we need to do.
No additional the studies in the future that's a separate.
Approach, but right now is gonna be just.
A single dose, but it is an important question because the optimal dose of volunteerism up is not.
Well defined or you know, there's a possibility we might.
Used in the future them Theres a lot without chemotherapy all these questions around the table, but for the time being we can just make a we want to make very slight modifications to through our ongoing protocols.
Got it but at this moment do you expect or maybe submit those are the christie indications or indication it deeper into up chemo Alemtuzumab Ddos is needed.
Yeah, we don't we don't know it may be different for each indication and we are talking about a b a allow on a amount because we are not the we will not to use alemtuzumab in this year's won a product but.
But for B.A.O., though on a amount that those unscheduled off one of this amount of maybe a slightly different.
Okay got it and then Oh, just for the year old man speed should we expect because you have the today. They are waiting period or should we expect about every patient to lungs, Cabo and human speed.
Yeah, what we have to wait 20 patients after the first a patient and then in in.
28, 28 days is a 28 days after the first the pacing on each cohort and then we can recruit the second hunter patient a little bit faster, but and then we have to evaluate all the data the safety.
Exploratory dates are caught expensive process et cetera.
So yeah. It takes about three months per cohort usually.
If there are no delays.
Hi, So you got it and then maybe I missed asking you mentioned maybe potential daily in the second now this year.
We hope will have data at the end of the year to 2% yes.
Okay. Great last question, maybe classification of the dose is that a car positive T cells or total T cells.
The classification of the dose is always south per kilogram is that your question. One thing. It's a it's a yeah. It's a it's a car parts. It was still numbers or is a total T cell numbers.
Hi, good embodies the 1 million per kilo, great isn't 1 million a car sold its car parts. It did I Scott cart cells, yes.
Okay got it okay. Thanks, very much for taking my questions.
Thank you won't be.
Thank you. Our next question comes from there and on then with Jefferies. Please proceed with your question.
Yeah, Hi, guys. Thanks for taking my questions.
Just on the survey agreement can you talk about the five targets that were returned to you and disclose what your plans are for those targets.
[laughter], we haven't disclosed that yet Vera and I would love to do [laughter].
Well, we'll definitely developed some of them yes.
We're we're we're super excited because there are great targets in the portfolio and.
And the and it's like this as the strong intention to put these targets into the clinic not this year about in the coming years definitely yes.
Our both the liquid and solid tumors targets.
Extremely relevant for some of them.
All of them by the way, but some of them. We think that have some interesting proof of concept would push us too.
[music].
Good luck in very favorable environment to to pretty targets into the clinic. So we're extremely excited by the portfolio.
But I will not saying they would like to work a bit on them and then then we'll we'll bring you will update you.
Later on on on what kind of targeting like to Bush, it's very can very competitive space.
And.
Were ones I'm on each other.
These targets.
And what was the rationale for server <unk> for returning those targets.
Well, we signed this agreement back in February 2014.
So more than six years now.
Whereas a lot of things that were like in hand and.
Oh, we consider that probably time to try to push one of the two targets after six years into clinic and it's probably was part of the negotiation.
Got it and then maybe if I could last couple of questions on your car 22 Andre.
Can you just talk about where these pediatric patients are they you know adult patients with L. I'll, just a baseline characteristics and all so are you in rolling in terms of restricting baseline blast counts.
And these patients. So if you could just give us some more color on this trial design that would be helpful.
It's an adult trial start the pediatric trial, but maybe on the way were recruited patients Francisco as you're in the front line in there.
I think it would be probably better if you have.
Yeah. The study we are a Korean at the moment. This is based on on adults, where we are we'll plan to do a pediatric studies next year on the in the protocol requires very high levels of I see it went cdtwenty two expression at least 90% expression on.
The blast. So we're looking for a very specific population, which is very common to for b cells to be cdtwenty two positive even if they low if even if they lose cdnineteen for example patients who are treated without all of us a cdnineteen car therapy may lose.
CD 19 are the time of progression, but they those blas retain a cdtwenty two expression show. So that's the population we are looking for in our in adults on these phase one trial at the moment.
Huh.
I mean, I guess these are patients that likely would have failed cdnineteen car coming into the study.
We are not excluding them. They are allowed its something that probably would happen in the future. We're allowing any you know it's not one of the eligibility, but it would be a an interesting population to the study is but yeah. So we are we accepting them, but it's not one of our eligibility criteria, we're very open.
Okay. That's it looks great with this is like Barry. This is lets great with record 22 actually it's it brings real unmet medical need all the like.
As Francisco said this is not the criteria and our trial, but every cdnineteen negative relapse or for any car T or by specific a study or treatment or whatever.
It has no alternate like in the it's an unmet medical need so you need to have the potential to come and brand a new product 22 can address these patients that are cdnineteen negative relapse or one that fills in 19 treatment and that's what makes a very excited and like a potential need.
That gives a very.
Exciting potential for this product itself.
And then maybe a question on the Annabel can you just talk about I think you said the starting dose is 250000 cells per kilogram, how does that compare to the prior I'll just call. It version one point now that you had in the clinic.
And can you just you know compare and contrast, the dose between that version versus two point now and I guess, what what's your sense in terms of Lymphodepletion regimen, because I think on the last trial you had CAFTA dosso cyclophosphamide to four grams or 14 is that still being.
Required for for a this new M.L. study.
Yeah.
Yeah, there I'm going to answer and on Okay. Go ahead like San Francisco, sorry about that.
I don't know it's.
What was.
Yeah I get caught you had so let me answer let me answer the beginning of the question I'll, let you answer on the cyclophosphamide so the doses.
That we used initially we started that six point 25 tend to defer itself or keurig.
For the BDC and Andy Ml trial back in 2017, where we had to clear expansion in BRAF and and we had unfortunately, there's some bpd San patient that died where we had the whole we had to de escalator six point 25 tend to do for cells per keurig.
With this initial the former pulled up and escalated back to 2.5 tend to defense.
Where we are currently so the immense like the new wind the the star Ddos is exactly the those where we stopped with the farm product and we're starting with 2.5 tend to differ.
The next Ddos is we're we're will be resuming back to the initial start though that we had in 2017. Once we've finished its first safety dose cohort at 2.5 tend to defense. So you would expect probably a 625 tend to the first on the second cohort then it's a graph too.
The dose level, which are I think three time tend to the sex and find Stanton to 5.5 times than to the six onto due to additional levels. So.
For now I think that we're just continuing on what has been down with the former product at the lower doses and then we'll resume exactly at 625 tend to discuss soon.
Yes in terms of the Lymphodepletion is basically the same as the previous versus.
Got it okay. Thank you.
Thank you as a reminder, ladies and gentlemen, we ask that you. Please limit yourself to two questions. Our next question comes in a line of Raj You Press thought with William Blair. Please proceed with your question.
Thanks for taking the question just a clarification on on the compared though this study because it's after the second cohort would you be able to use kind of that second cohort dose or a third cohort dose just around to them out or would you start kind of from the beginning and dose escalate with the into onto that.
To do a compared always on the lowest dose kind of through and then on.
The higher doses and kind of look across the studies can you just kind of give some thoughts on split dosing and in Europe, and whether or not you'll have to do split doesn't come at a higher dose cohorts.
Thanks.
So the in terms of Oh I'm sorry.
No no, but oh that they'll into some of that basically for its those level. For example, if we start at those levels too we have to make sure that those level to by itself is safe before we have alemtuzumab and then we can either use the same those.
Like the let's say these those level to save we move to those level to plan seldom do some up or to those that were three or three I just to clarify we'll do this at the same time, so we're not wasting anytime.
And in terms of that Super I'm going to have a higher doses, we but we're not blind to the split dosing at the moment something we could do a easily but.
Our thought at the moment is that if we can get a high dose initially with good lymphodepletion that will be a big.
A big blocks to the tumor is probably better than than.
And then otherwise, but the with US what were thinking right now it does and those maybe an important aspect.
In some of these targets.
And maybe they sent them or that the target.
Yeah and then.
On the potential for Reed dosing can you just kind of describe the protocol for that promote lymphodepletion perspective and you.
If we see data by year end is or the potential to see attrition that's been reduced.
We can't possibly read those after discussion with the F.D.A. and.
The investigators and and ourselves, but on the a one to three on the see they wanted to all your car T. One to three but we're still at this moment where is that a a very early in development, we may see something but at the end of the year, but is now.
It's not a routine treatment for any of this protocols at the moment.
But it's a possibility, but I do not anticipate a lot of EUR three dose in this year.
Okay, great. Thanks.
Thank you. Our next question isn't a line of hearth those thing what Oppenheimer and company. Please proceed with your question.
Great. Thank you just have a couple of questions. A one is you Henri you I assume you got some learnings off you Carpenter three manufacturing experience you I'd Ah I assume you. So then too.
Oh, you know some some more batches were 22, yes. One is that progressing you know as you expect I guess, one kind of asking around about matter is that are you seeing any manufacturing changes that you'd have to submit to the FDA you know what either 22, Rcs will not be analogous to what happened.
123, I just got a couple of <unk>.
It's a great question Hartaj sorry.
It's it's it's a great question because you know was heads.
We've been manufacturing car T for.
Six years.
Most something like six years since since 2014, GMP I'm talking not in the lab and we've seen a lot.
Yes.
Different cases around and build tremendous amount of Knowhow and 2017 and in 20 chain, where we're starting hitting certain problems that we had and we had to fix we've invested a tremendous amount of energy on the process development and the analytical development.
And this has led and the second half of 20 team.
To process.
That is extremely robust and the ability to produce car T is in a very consistent way from batch to batch donor to donor and from car to car.
And we consider today that we has a very stable process.
And we're just working on the B.L.A. version now it's a it's a translating this.
Clinical supply process to a commercial supply pro services.
And it's something that we have been focused now and that's why we're building our manufacturing plant I think this process will be ready in time, the manufacturing plant in Paris is going to go live.
This year and one in rally will go lives next year, I think we'll be ready for the Bailey.
Versions versions with enough and that's is all the efforts of the company that has been made in the past years and deprived we take out from the manufacturing excellence that we have reached today.
That's great Andre Oh, thanks for that color and.
And the robustness now if your manufacturing strategy I'm. Another question I had for just a is can you just remind us I know you had mentioned about 28 days between patients I believe for one to three is that the same for 22 NCS Wonder if you just remind us what is the Oh the time, you've got a week between patients had between cohorts for the other two.
So it's for a one to three it's 20 days between patient one and patient to 15 days between patient to inpatient three.
And then you have the end of cohort, beating a 28 days.
After like the end up 20 days you have to wait a bit up to time at the end of cord meeting and then you can start the second those level for C. S. One.
And 22, it's always the same between patient one and patient to foresee at Swan. Once you have to 20 days between patient one ambition to and you can enroll two patients immediately once you finish. This 2028 days so it's a bit factor then.
One to three don't have the 15 days and 22 is the same.
Great. Thank you and then last question is just a financial question. If you can just give us some insight I know that you had a big step up in R&D expense.
The fourth quarter 2019 over the third quarter, we generally tends to happen, but it seems to be a little bit larger this year than previous years, you know how to think about R&D going forward into 2020, and then just opex in general or any thoughts on Opex Burns 2020 versus what happened.
Okay. Thank you for the question.
Okay.
Okay, I'm going to leave maybe Eric comment on this one thing I'd like to comment about this is if you notice that there is an increased expenses in R&D expenses, which we take pride out off we've been also becoming more lean on day as Jenny.
With a great effort to try to focus most of the value of the company on building.
Building assets the company, so Eric and we'd like to come yeah and to complement what you know there's a set of more than 80% of the total operating expenses Cellectis Oh I knew for R&D expenses. So we are we have a pretty lean a you know structure.
We don't provide any guidance as you could see we had $18 million of R&D expenses, if you backed out the noncash stock based compensation expenses.
$70 million off we we expect that that's will increase.
More up to a between a one on the other than went around $10 million off a in 2020 and we remain Oh.
Lena I'm you know on the inexpensive.
Great. Thank you so much.
My car tires.
Thank you. Our next question comes from Yigal Nochomovitz with Citi. Please proceed with your question.
Hi, this is some as onto your call. Thanks for taking my question I'm wondering if you just and help us frame expectations for the data read out potentially at the end of the year I'm should be.
Well what was the criteria that you're using sort or decide if you have enough data to go forward with reporting and it's a potential safety data from all three yes, 122, and 123 by the end of there. Thank you.
Francisco.
Yes, I, we expect to be able to present data on all of them and hopefully a is that it's hard to tell us how many cohorts will have but we want to be transparent on show what we have oh by the end of the year. That's that's our current thinking.
Great. Thanks, very much for taking the question.
Okay. Thank you.
Thank you. Our next question isn't a line of Bertrand Deltic with bio Telematics. Please proceed with your question.
Yes, Hello. Thank you for taking my question I have one actually on the.
Use of I'm to demand that you want to introduce.
Two and then amount and you've got to 22 I wasn't it surprises I used today when I I read that you had to file an amendment pool for that and simply because all based on the fact that on a with you got 19.
When only a site so food that was used there was no expansion seen on a basis they down from three patients or perhaps for <unk> I remember I can remember.
So I was wondering about the rationale or.
It's a using on me site to food Emporium Guard 22.
It was based on recommendation from the 88 wanted you to a I'd say two to prove that the you got thank you do with safe.
Do you we wanted to process a with a before a moving for yeah. So.
That is the first question.
So to answer your question actually it's absolutely not related to any questions from the FDA to do this it's like well of the company to try to file a comparative study.
And it's the study it's not to try to compare cohort.
Between with or without later in the year.
And you compare for example, the data that has been provided by companies.
Such as President by assignment for example, they showed that there was expansion and even the heads and complete remission with no preconditioning.
With Alan Tourism add with their Cdnineteen car T.
Which puts that you don't see as specifically elotuzumab to have expansion and a tumor response in there.
It's also when you look at the CD want do like to call 123 first patient that we had we had in rather than an expansion and the two first station, where we stop the study back in 2017 without the use of LNG is a mad at this time.
Now we are working on this year on trying to find the right way too, though the patient and to do this we need to have a very comprehensive way to analyze the way to preconditioning to precondition to patients and using older tools that are.
Our disposal currently which is cyclo flew the Alan to them out and maybe potentially other things that could be used the would probably use them and the way to administer drug in the single dose do those there was the question for the split dosing is something that.
Could also be put on the table and we have full year to try to investigate all this up to the time, we go for the confirmation of the right way to precondition to patients and to those the patient during the expansion.
Face to move into the pivotal phase.
So this is absolutely not a way too.
Yeah.
We like to correct what is done trends Lee, but try to do a comprehensive study of the way to administer this type of these type of drugs.
Okay got it and just spoke for confirmation that the new process manufacturing process. You introduced for went to switch. It also used for 22 or is just one as of today or as you say it will be.
<unk>.
At the later date for the Registrational trial.
<unk> presence will you want to answer this question.
So the manufacturing will.
We'll be HM.
Say.
Maybe does the Simon just to jump in have ethanol.
The manufacturing we've done continuously evolve so for one to three specifically there was a new manufacturing campaign done after our third party manufacturing organization, one or two remanufacture. These batches, but just to give you a level overview of where we are with many.
Factoring we have currently thousands of those is done for each of the products. We have in the clinic. So we have no shortage of supply for these clinical trials, leading up to registration and our strategy with manufacturing is currently to bring everything in house switch, we are doing with Paris as it.
Rich and with Raleigh, North Carolina as the full commercial scale manufacturing organization and the completion of these in house a piece is a go hand in hand with us going through the clinical trials progressing towards potential commercialization of our product. So you know we would probably be.
Ready with AFFO in house commercial facilities at least one to two years before the anticipated commercialization of a first product. So I think we're in really good shape. We know the products. We currently have manufactured our top quality and they are satisfying all our highest quality standards we have internally.
Okay, Great just the last one on 22 and you say that's the first dose is a EUR 105.
And as it is the second do.
1 million. So there is a factor Jim.
Usually it's more a full as most of those people that she oh the sequence. So let's say could you have just to comment on the jump from.
We see from July one two years true and Oh, so well, it's more a full for the future, but as you have a flexible a trial design for 22.
Last year that was that there was also a that's something publications about two cents. He died cdtwenty two please.
Hi, then we will use that Jim Bob it's not we determined that doing this today.
Oh I get the population with ER I expression, those TV French too, but you also foresee some oh, though Oh school so using those elements that he's done we didn't just frame as he said.
<unk>.
Well for the Ddos is actually we it's exactly the same dose escalation strategy as conducted for your cards 19, I'd said same store different as it's a it's like a targeted exactly the same type of indications that's where we're in the same.
Type of trend.
Most of the timely can calculate over a few banacci or sometimes or are the old or the parameters that enter in there that we won disclose here, but it's exactly the same way. It has been calculated for 19 and 22 in there and does.
Thats the way it has been done and.
Mike maybe you want to take the second part of the question right away.
So the is yes, that's an interesting is interesting point that we could combine the your car T. R 22, with other agents or to try to improve the.
The engraftment and persistence and so on but it's not something we're planning to do this year, because we need to show that the product is safe unaffected by itself, but it's something that the week with explore a in the future.
And just to add maybe for the benefit of everyone still on the call I just wanted to reiterate our decision to add Allen to them out as a very thoughtful one for 22 and it will not be it a in any way extending the timelines for any of the product because it basically goes hand in hand with the dose escalate.
Isn't that we're currently conducting it is for us to have a better overview of what is the best Lymphodepletion Regiment, we have a lot of experience with both approaches with Alan to them up without Allen to the map, we already know how alent isn't that performs at different doses and we will dial in perfectly the right Lymphodepletion right.
Drummond to make it an optimal outcome for each patient and each different indication that we are pursuing but all in all we're very excited that our programs are moving forward through the dose escalation, we're seeing very encouraging sign so far and we're very excited to share our data by the end of this year.
Exactly and plus like we will it's too early stage to speak about though what has to be improved as we think that the product that we have design or where do you.
Well design.
<unk>.
Thank you ladies and gentlemen, this concludes our question and answer session. So I'd like to pass the floor back over to Mr. harnessed for any additional concluding comments.
Yes again, thank you everyone and were excited to have you guys on board and where again happy to share anymore update you can always call. It directly and we're looking forward to seeing you at their friend a investment conferences and scientific conferences this year.
Thank you ladies and gentlemen, this does conclude today's teleconference. Again, we thank you for your participation and you may disconnect your lines at this time.
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