Q1 2020 Earnings Call

[music].

Hello.

[laughter].

Welcome to the fate Therapeutics first quarter 2020 financial results Conference call.

Operator: Please visit www.potterybarn.com for more ideas and inspiration. Hello, and welcome to the Fate Therapeutics First Quarter 2020 Financial Results Conference Call. Our participants are listed in a list of, This call is being webcast live on the Investors and Media section of Fate's website at fatetherapeutics.com. As a reminder, today's call is being recorded. I would now like to introduce Scott Washko, President and CEO

At this time, all participants are in listen only mode.

This call is being webcast webcast live on the investors section of fates website, it fate therapeutics Dot com.

As a reminder, today's call is being recorded.

I would now like to introduce Scott Wasco, President and CEO of fate therapeutics.

Thank you.

Good afternoon, and thanks, everyone for joining us for the fate Therapeutics first quarter 2020 financial results call. Shortly after four PM Eastern time today, we issued a press release with these results, which can be found on the investors immediate section of our web site under press releases.

Scott Washko: Thank you. Good afternoon, and thanks, everyone, for joining us for the Fate Therapeutics first quarter 2020 financial results call. Shortly after 4 p.m. Eastern time today, we issued a press release with these results, which can be found on the investors and media section of our website under press releases. In addition, our Form 10-Q for the quarter ended March 31, 2020, was filed shortly thereafter and can be found on the Investors & Media section of our website under Financial Information. Before we begin, I would like to remind everyone that, except for statements of historical facts, the statements made by management in response to questions on this conference call are forward-looking statements under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Scott Washko: These statements involve risks and uncertainties that can cause actual results to differ materially from those in such forward-looking statements. Please see the forward-looking statement disclaimer in the company's earnings press release issued after the market closed today, as well as the risk factors in the company's SEC filings included in our Form 10-Q for the quarter ended March 31, 2020, that was filed with the SEC. Undue reliance should not be placed on forward-looking statements, which speak only as of the date they are made, as facts and circumstances underlying these forward-looking statements may change.

In addition, our form 10-Q for the quarter ended March 31, 2020 was filed shortly thereafter and can be found on the investors and media section of our web site under financial information.

Before we begin I would like to remind everyone that except for statements of historical facts. The statements made by management and responses to questions. On this conference call are forward looking statements under the Safe Harbor provisions of the private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that.

Scott Washko: Except as required by law, Fate Therapeutics disclaims any obligation to update these forward-looking statements to reflect future information, events, or circumstances. Joining me on today's call are Dr. Dan Shoemaker, our Chief Scientific Officer; Dr. Bob Valamehr, our Chief Development Officer; and Dr. Wayne Chu, our Senior Vice President of Clinical Development. Today, I will comment on the impact of the COVID-19 pandemic on our business, highlight key milestones we achieved during the past several months, and discuss the transformative collaboration we recently entered into with Janssen. The global COVID-19 pandemic has significantly impacted our daily lives. And we have been compelled to change our day-to-day operations to cope with these unprecedented times.

Can cause actual results to differ materially from those in such forward looking statements.

Please see the forward looking statements disclaimer on the Companys earnings press release issued after the market of closed today as well as that risk factors in the Companys SEC filings included in our form 10-Q for the quarter ended March 31, 2020 that was filed with the FCC today.

Undue reliance should not be placed on forward looking statements, which speak only as of the date. They are made as facts and circumstances underlying these forward looking statements may change, except as required by law fate therapeutics disclaims any obligation to update these forward looking statements to elect to reflect future information.

Events or circumstances.

Joining me on todays call, our Dr., Dan Shoemaker, our Chief Scientific Officer, Dr., Bob Alimera, Our Chief Development Officer, and Dr. Wayne Shoe, our senior Vice President of clinical development.

Today, I will comment on the impact of the Cobot 19 pandemic on our business highlight key milestones we achieved during the past several months and discuss the transformative collaboration we recently entered into with Janssen.

The global Cobot 19 pandemic has significantly impacted our daily lives and we've been compelled to change our day to day operations to confront with these unprecedented times.

We have taken numerous measures to protect the health and safety of our employees their families and the extended community while continuing to operate our business.

Scott Washko: We have taken numerous measures to protect the health and safety of our employees, their families, and the extended community while continuing to operate our business. Shortly after the J.P. Morgan conference, we reassessed our preparedness for a potential pandemic and began implementing changes to our operations. We confirm that our master IPSC lines and our manufactured clinical products were inventoried in redundant locations, and we stocked clinical sites with our clinical products to enable off-the-shelf administration to patients. We also worked with our suppliers to accelerate the sourcing of key materials to support the conduct of our planned in-house GMP manufacturing campaign. Additionally, we implemented a work-from-home policy and restricted on-site personnel to those conducting essential laboratory and manufacturing activities.

Shortly after the JP Morgan conference, we reassessed, our preparedness for a potential pandemic and began implementing changes to our operations, we confirmed that our master IP FC lines on our manufactured clinical products or inventory in redundant locations and we stop.

Clinical sites with our clinical products to enable off the shelf administration to patients.

We also worked with our suppliers to accelerate the sourcing of key materials to support the conduct of our planned in house GMP manufacturing campaigns.

We implemented a work from home policy and restricted on site personnel to those conducting essential laboratory and manufacturing activities.

We worked closely with our clinical trial sites and investigators to promote the safety and continued care of study participants implemented remote site activation and patient monitoring and preserve data integrity.

Scott Washko: We worked closely with our clinical trial sites and investigators to promote the safety and continued care of study participants, implemented remote site activation and patient monitoring, and preserved data integrity. We believe we have established operational capabilities, including full control of GMP, that will allow us to operate with resolve and advance our business objectives. The commitment, resourcefulness, and resilience of our employees carried us through these challenging times. We have been disrupted by COVID-19, though, as the cadence of new clinical trial site initiation and patient enrollment has been slowed. While we remain committed to our clinical programs and development plans, these disruptions have introduced some uncertainty with respect to our projected timelines for enrollment and data readouts across our clinical trials. Nevertheless, we have maintained significant business momentum across our three clinical programs, all of which have continued to enroll patients.

We believe we have established operational capabilities, including full control of GMP manufacture that will allow us to operate with resolve and advance our business objectives.

Commitment resourcefulness and resilience of our employees have carried us through these challenging weeks.

We have been disrupted by the coven 19, though as the cadence of new clinical trial site initiation and patient enrollment has been slowed.

While we remain committed to our clinical programs and development plans. These disruptions have introduced some uncertainty with respect to our projected timelines for enrollment and data readouts across our clinical trials.

Nevertheless, we have maintained significant business momentum across our three clinical programs all of which have continued to enroll patients.

For each of our programs, we have manufactured hundreds of Cryopreserved infusion ready doses, which have been tested released and stored in inventory and our immediately available for use in our clinical studies.

Scott Washko: For each of our programs, we have manufactured hundreds of cryo-preserved, infusion-ready doses, which have been tested, released, and stored in inventory and are immediately available for use in our clinical studies. With respect to our FT500 program, we have now treated three patients with FT500 at the 300 million cell dose level in combination with checkpoint inhibitor therapy and successfully completed enrollment in the dose escalation stage of the FT500 phase one clinical trial in advanced solid tumors. We believe this is a significant clinical milestone, as our FT500 Phase I study is the first ever clinical trial in the United States of an IPS-derived cell product. Additionally, it is one of the first ever clinical trials of a cell therapy to evaluate a novel multi-dose treatment course, consisting of outpatient lymphoconditioning, followed by three once-weekly doses of FT500 over up to 230-day treatment cycles.

With respect to our FC 500 program, we have now treated three patients with S&P 500 at the 300 million cell dose level in combination with checkpoint inhibitor therapy and successfully completed enrollment in the dose escalation stage of the 5500.

Scott Washko: I'm pleased to report that, consistent with our prior clinical observations in the dose escalation stage of the FT500 Phase 1 study, there were no dose-limiting toxicities, no FT500-related grade 3 or greater adverse events or serious adverse events, and no incidents of cytokine release syndrome, neurotoxicity, graft-versus-host disease reported by investigators, Enrollment in the dose expansion stage of the FT500 Phase I study is proceeding at three clinical sites in patients with non-small cell lung cancer, where up to 40% of patients with resistance to checkpoint inhibitor therapy exhibit partial or complete loss of MHC class 1 expression, making these cancers highly susceptible to NK cell recognition and killing.

Phase, one clinical trial and advanced solid tumors.

We believe this is a significant clinical milestone as our ft 500 phase. One study is the first ever clinical trial in the United States of an IPO steroids cell product.

Scott Washko: We expect to treat up to 15 patients in the outpatient setting in the dose expansion stage, administering three once-weekly doses of FT500 at 300 million cells per dose over up to two 30-day cycles, along with IL-2 cytokine support, and with the checkpoint inhibitor on which the patient failed or progressed. FT516 is the second program emerging from our iPSC product platform and the first engineered iPS-derived cell therapy in the world to undergo clinical investigation. We continue to conduct the dose escalation stage of the FT5-16 Phase I clinical trial as monotherapy for AML and in combination with rituximab for advanced B-cell lymphoma. We have successfully activated two additional sites, for a total of three active sites. And we are currently working with two additional sites on remote activation.

Additionally, it is one of the first ever clinical trials of a cell therapy to evaluate a novel multi dose treatment course, consisting of outpatient lymphoma conditioning, followed by three once weekly doses of S&P 500 over up to 230 day treatment cycles.

I'm pleased to report that consistent with our prior clinical observations in the dose escalation stage of the F. HTI 500 phase. One study there were no dose limiting toxicities no ft, 500 related grade three or greater adverse events or serious adverse events.

And no incidence of cytokine release syndrome, neuro toxicity graft versus host disease reported by investigators in these three patients.

Enrollment in the dose expansion stage of the F. T 500 phase one study is proceeding at the re clinical sites in patients with non small cell lung cancer or up to 40% of patients with resistance to checkpoint inhibitor therapy exhibit partial or complete.

Loss of MHC class one expression.

Making these cancers highly susceptible to NK cell recognition and killing.

We expect to treat up to 15 patients in the outpatient setting in the dose expansion stage administering three once weekly doses of S&P 500 at 300 million cells per dose over up to 230 day cycles, along with aisle to cytokine support and.

With that checkpoint inhibitor on which the patient sale there progressed.

Ft 516 is the second program, our emerging from our IP FC product platform and the first engineered IP us derived cell therapy in the world to undergo clinical investigation, we continue to conduct the dose escalation stage of the F. T 516 phase one clinical trial as a monotherapy.

Scott Washko: In addition, we successfully expanded the clinical scope of our FT516 program to advance solid tumors. In January, the FDA approved our second IND application for FT516, enabling clinical investigation in combination with PD-L1, PD-1, EGFR, and HER2-targeted monoclonal antibody therapies across a broad range of solid tumors. We intend to initially evaluate FT-516 in combination with value map, an ADCC-competent anti-PD-L1 immune checkpoint inhibitor, in patients with advanced solid tumors who are refractory 2 or have relapse following at least one line of anti-PD-L1 therapy. We expect first patient enrollment in combination with Velumab in the coming months.

For AML and in combination with Rituximab for advanced B cell lymphoma.

We have successfully activated two additional sites for a total of three active sites and we're currently working with two additional sites on remote activation.

In addition, we successfully expanded the clinical scope of our Ft Fysixteen program to advanced solid tumors in January the FDA allowed our second R&D application for F. T fysixteen, enabling clinical investigation in combination with PD one PD one.

Fr and her to targeted monoclonal antibody therapies across a broad range of solid tumors.

We intend to initially evaluate EFSEC fysixteen in combination with a value mab and ADCC comp and in anti PDL, one immune checkpoint inhibitor in patients with advanced solid tumors, who are refractory to will have relapse. Following at least one line of and type.

Well one therapy.

We expect first patient enrollment in combination with the value mab in the coming months.

With respect to our FSC 596 program, we treated the first patient in the dose escalation stage of the 50 596 phase one clinical trial for advanced B cell malignancies, and chronic lymphocytic leukemia.

Scott Washko: With respect to our FT-596 program, we treated the first patient in the dose escalation stage of the FT-596 phase I clinical trial for advanced B cell malignancies and chronic lymphocytic leukemia. We are particularly excited about this clinical milestone. FT596 is the first-ever cellular immunotherapy engineered with three active antitumor components to be evaluated in patients, and it is uniquely designed to target multiple tumor-associated antigens expressed on cancerous B cells for best-in-class potential. In addition to a proprietary CAR targeting CD19, FT596 expresses our novel high-affinity, non-cleavable CD16 FC receptor, enabling multiple antigen targeting FT596 also expresses a novel IL-15 receptor fusion, a potent cytokine complex that promotes survival, proliferation, and transactivation of NK cells and CD8 T cells without the need for systemic cytokine support. One site is currently active, and we are currently working with three additional sites on remote activation.

Scott Washko: In addition, I'm also pleased to announce that we have successfully expanded the clinical scope of our FT-596 program, as the FDA allowed a second IND application for FT597. Sponsored by investigators from the Masonic Cancer Center, University of Minnesota, this new Phase I clinical study is intended to assess the potential of FT596 to prevent relapse in patients undergoing autologous hematopoietic stealth transplant for the The clinical trial is expected to enroll up to 18 patients considered high risk for early relapse based on failure to achieve complete or partial remission on or relapse within 12 months of prior therapy. Up to three dose levels of FT-596 will be administered in combination with rituximab thirty days following transplant.

Scott Washko: We also continue to be excited about our rate of preclinical innovation, including our ability to add on additional engineered features and functionality, rapidly build next-generation product candidates, and advance our pipeline of engineered IPS-derived and K-cell product candidates into clinical development. I'm pleased to announce that we have recently submitted an IND application to the FDA for FT-538, the first CRISPR-edited, IPS-derived self-therapy. FT538 is derived from a clonal iPSC line engineered with HNCD16 and our IL-15 receptor fusion, and edited for elimination of CD38 expression to mitigate anti-CD38 antibody-mediated fracture. We intend to clinically investigate FT538 in combination with anti-CD38 monoclonal antibody therapy for the treatment of multiple myeloma.

We're particularly excited about this clinical milestone.

50, 596 is the first ever cellular immunotherapy engineered with three active anti tumor components to be evaluated in patients and is uniquely designed to target multiple tumor associated antigens expressed on cancerous b cells for best in class potential.

Scott Washko: In addition to FT538 as a clinical candidate, we believe the clonal master-engineered IPSC line for FT538 may serve as a foundational cellular backbone for the building of future IPS-derived NK-cell product kits. For example, at this week's American Society of Gene and Cell Therapy virtual annual meeting, we will highlight the creation of a master-engineered IPSC line for FT576. Our off-the-shelf, IPS-derived CAR-BCMA and K-Cell product candidate, using an existing master-engineered IPSC line from the FT-538 program as starting material. Similarly, at ASGCT, we will also present preclinical data for our recently announced CAR McGay-McBee program.

In addition to a proprietary car targeting Cdnineteen ft, 596 expresses our novel high affinity non cleavable CD Sixteena FC receptor, enabling multiple antigen targeting of Cdnineteen and additional tumor associated antigens, such as CD 20.

After 596 also expressed as a novel IL 15 receptor fusion, a potent cytokine complex that promotes survival proliferation, and trans activation of NK cells, and Cdeight T cells without the need for systemic cytokine support.

One site is currently active and we're currently working with three additional sites on remote activation.

In addition, I'm also pleased to announce that we have successfully expanded the clinical scope of our EFT T 596 program.

As the FDA allowed a second R&D application for F. 30, 596 sponsored by investigators from the Masonic Cancer Center University of Minnesota. This new phase one clinical study is intended to assess the potential of ft 596 to prevent relapse in patients undergo.

Autologous hematopoietic cell transplant for the treatment of non Hodgkin lymphoma.

A clinical trial is expected to enroll up to 18 patients considered high risk for early relapse based on failure to achieve complete or partial remission on or relapsed within 12 months of prior therapy.

Up to three dose levels of Ft, Fivenine six will be administered in combination with Rituximab 30 days following transplant.

We also continue to be excited about our rate of preclinical innovation, including our ability to add on additional engineered features and functionality.

Rapidly build next generation product candidates and advance our pipeline of engineered ipsc derived NK cell product candidates into clinical development.

I'm pleased to announce that we have recently submitted an R&D application to the FDA for F. T 538, the first CRISPR edited IP EPS derived cell therapy.

Scott Washko: Targeting Pan-Tumor Associated Stress Pro- where the initial product candidate forms have been developed using an existing master-engineered IPSC line from the FT-538 program. As many of you know, about five years ago when we set out on this journey to bring IPS-derived cell-based cancer immunotherapy to patients, our mission included both NK cells and T cells, as the delivery of both cell types may ultimately play a critical role in curing cancer We formed a foundational collaboration in 2016 with Memorial Sloan-Kettering, led by Dr. Michelle Sadeline, to guide our path in developing off-the-shelf, IPS-derived CAR-T cell therapy. Over the years, we've followed the science and clinical learnings emerging from the autologous CAR T cell field, and continue to innovate to include state-of-the-art features and functionality in our IPS-derived We pioneered the creation of a clonal master iPSC line engineered with a CAR inserted into the TRAC locus to regulate CAR expression, optimize cytotoxic activity, and eliminate T cell receptor expression for mitigation of graft-versus-host disease. We refined our differentiation protocol with the goal of making potent alpha-beta T-cells that closely match their naturally-occurring counterpart.

50, 538 is derived from a global IP FC line engineered with H. NCD 16.

And our IL 15 receptor fusion.

And edited for elimination of CD 38 expression to mitigate anti cdthirty eight antibody mediated fracture side.

We intend to clinically investigate ft 538 in combination with anti Cdthirty eight monoclonal antibody therapy for the treatment of multiple myeloma.

In addition to F 35, 38 as a clinical candidate we believe the colonial Master engineered PSC line for F. 35, 38 may serve as a foundational cellular backbone for the building of future IP us derived NK cell product candidates for.

For example, at this week's American Society of gene and cell therapy virtual annual meeting we will highlight the creation of the master engineered IP FC line for F. T 576 are off the shelf IP best arrived car Bcm may NK cell product candidate.

It using an existing master engineered PSC line from the F 35, 38 program starting material.

Similarly at asked GCT, We will also presented preclinical data for our recently announced karmic game B program targeting pan tumor associated stress proteins, where the initial product candidate forms have been developed using existing master engineered IPO C line.

From the 50 538 program.

As many of you know about five years ago. When we set out on this journey to bring IP EPS derived cell based cancer immuno therapy to patients. Our mission included both NK cells and T cells as the delivery of both cell types may ultimately play a critical role in carry.

In cancer.

We formed a foundational collaboration in 2016 with Memorial Sloan Kettering led by Dr. Michel side aligned to guide our path in developing off the shelf IP us derive car T cell therapy.

Over the years, we followed the science and the clinical learnings emerging from the autologous car T cell field.

And continue to innovate to include stated the our features and functionality in our IP, yes derive car T cell programs.

We pioneered the creation of a colonial master IP has seen line engineered with a car inserted into the track locus to regulate car expression.

Optimized cytotoxic active cytotoxic activity and eliminate T cell receptor expression for mitigation of Greg graft versus host disease risk.

We refined our differentiation protocol with the goal of making potent alpha beta T cells that closely match their naturally occurring counterparts.

And we raised our IP has dried car T cell product candidates against primary car T cells in the most stringent preclinical models under our collaboration with the founder of car T cell therapy.

Scott Washko: And we raced our iPS-derived CAR T-cell product candidates against primary CAR T-cells in the most stringent preclinical models under our collaboration with the founder of CAR T-Cell Center. I'm pleased to announce that we remain on track to submit our IND application to the FDA in the second quarter for FT-819, the world's first off-the-shelf, IPS-derived CAR T- FT819 is derived from a clonal master IPSC line engineered with a novel 1XX car targeting CD19 inserted into the track locus and edited for elimination of TCR expression. We continue to strive to bring FT819 to the first patient in 2020. Finally, I'd like to make a few comments about our newly formed collaboration with Jamf.

I'm pleased to announce that we remain on track to submit our R&D application to the FDA in the second quarter for F. T 819.

The world's first off the shelf IP Sri car T cell therapy.

FDA 19 is derived from a clinical master I PSC line engineered with a novel one Xx car targeting cdnineteen inserted into the track locus and added four elimination of TCR expression.

We continue to strive to bring FTD 19 to the first patient in 2020.

Finally, I'd like to make a few comments about our newly formed collaboration with Janssen.

A partnership is transformative for us and I believe it's significantly increases our ability to invest in innovation.

Scott Washko: The partnership is transformative for us, and I believe it significantly increases our ability to invest in innovation, build commercial-scale IPSC manufacturing operations, Bring best-in-class, IPS-derived, cell-based cancer immunotherapies to patients, and Deliver Value to Shareholders. The collaboration brings together Janssen's scientific leadership and deep domain expertise in oncology and our industry-leading IPSC product platform. Our mutual objective is to research, develop, and commercialize novel, off-the-shelf, IPS-derived CAR-NK and CAR-T cell products. With respect to the collaboration scope, the collaboration is antigen-targeted based, and includes both CAR-NK and CAR-T cell candidates directed to up to four tumor-associated antibodies. The binding domains directed to the four antigen targets are proprietary to and are being contributed by Janssen for construction of the CAR construct. The cancers we are seeking to treat include both hematologic malignancies and solid tumors.

Build commercial scale IP Etsy manufacturing operations bring best in class IP EPS derived cell based cancer immunotherapies to patients and deliver value to shareholders.

The collaboration brings together Janssen scientific leadership and deep domain expertise in oncology and our industry, leading IP FC product platform.

Our mutual objective is to research develop and commercialize novel off the shelf IP EPS derived car and K and car T cell products.

With respect to the collaboration scope. The collaboration is antigen targeted based and includes both car end Kay and car T cell candidates directed to up to four tumor associated antigens.

The binding domains directed to the four antigen targets, our proprietary too and are being contributed by Janssen for construction of the car constructs.

The cancers, we are seeking to treat include both hematologic malignancies and solid tumors.

Note that this is a deeper collaboration in that it is not limited to a specific number of collaboration candidates. In fact, we can continue to innovate and develop next generation collaboration candidates together against those four specific antigen targets.

Scott Washko: Note that this is a deep collaboration, in that it is not limited to a specific number of collaboration tenants. In fact, we can continue to innovate and develop next generation collaboration candidates together against those four specific antigen targets. Under the collaboration, we will drive and conduct innovation, preclinical development, and conduct IND-enabling activities for each IPS-derived CAR-NK and CAR-T cell collaboration candidate. Importantly, all these activities are entirely funded by Jan

Under the collaboration we will drive and conduct innovation preclinical development and conduct R&D, enabling activities for each IP us derived coring cane car T cell collaboration candidate.

Importantly, all these activities are entirely funded by Janssen.

And we will receive full funding for all innovation preclinical development and the idea enabling activities that we perform under the collaboration.

Scott Washko: And we will receive full funding for all innovation, preclinical development, and IND-enabling activities that we perform under the collaboration. Upon the completion of activities sufficient to allow for submission of an IND, Janssen will have the right to exercise an exclusive option and obtain an exclusive license for the clinical development and commercialization of the collaboration candidate. Janssen will be solely responsible for worldwide clinical development and commercialization, and we will be primarily responsible for the manufacture, at Janssen's cost, of the collaboration. For each collaboration candidate, upon Janssen's attainment of clinical proof of concept, we have the right to elect to co-commercialize and share equally in the profits and losses in the United States. Subject to sharing in certain development, I'd like to emphasize that the collaboration candidates under the Yans We will continue to independently innovate and exploit our

Upon the completion of activity sufficient to allow for submission of an eye, Andy Janssen will have the right to exercise and exclusive option and obtain an exclusive license for the clinical development commercialization of the collaboration candidate.

Janssen will be solely responsible for worldwide clinical development and commercialization and we will be primarily responsible for the manufacture at janssens cost of the collaboration candidate.

For each collaboration candidate upon janssens attainment of clinical proof of concept, we have the right to elect to co commercialize and share equally in the profits and losses in the United States subject to sharing in certain development costs.

I'd like to emphasize that the collaboration candidates under the Anson collaboration do not include any product candidates that are currently under clinical or preclinical development by us or otherwise part of our current product pipeline.

We will continue to independently innovate and exploit our deep pipeline of wholly owned product candidates.

With respect to the collaboration economics, we received $100 million in April of which $50 million was an upfront cash payment and $50 million. It was in the form of an equity investment at $31 per share.

Scott Washko: With respect to the collaboration economics, we received $100 million in April, of which $50 million was an upfront cash payment, and $50 million was in the form of an equity investment at $31 per share. For the first antigen target, we are eligible to receive... up to $898 million upon the achievement of specified development, regulatory, and sales milestones for the first collaboration candidate, and up to $460 million in milestone payments for each additional collaboration candidate. For each of the second, third, and fourth antigen targets, we are eligible to receive up to $706 million in proprietary milestone payments for each of the first collaboration candidates and up to $340 million in milestone payments for each additional collaboration ten. In total, assuming only one collaboration candidate across each of the four antigen targets.

For the first antigen target, we are eligible to receive up to $898 million. Upon the achievement of specified development regulatory and sales milestones for the first collaboration candidate and up to 460 million a milestone payments for each additional collaboration candidate.

For each of the second third and fourth antigen targets, we are eligible to receive up to 706 million in proprietary in milestone payments for each of the first collaboration candidates and up to 340 million a milestone payments for each additional collaboration candidate.

In total assuming only one collaboration candidate across each of the four antigen targets, we are eligible to receive payments of up to 1.8.

Scott Washko: We are eligible to receive payments of up to $1.8 billion upon the achievement of development and regulatory milestones and up to $1.2 billion upon the achievement of commercial models. However, in the event we elect to co-commercialize a particular collaboration candidate with the benefit of sharing equally in the profits and losses in the United States, these milestone payments are subject to reduction. In addition, we are eligible to receive double-digit royalties, ranging up to the mid-teens, on net sales of collaboration products that are commercialized by J&J. With respect to the collaboration's strategic value, I would highlight several key points. First, we have partnered with one of the strongest oncology teams in the entire industry, one with outstanding scientific, clinical development, and commercialization expertise.

$8 billion upon the achievement of development and regulatory milestones and up to $1.2 billion upon the achievement of commercial milestones.

In the event, we elect to co commercialize a particular collaboration candidate with the benefit of sharing equally in the profits and losses in the United States. These milestone payments are subject to reduction.

In addition, we are eligible to receive double digit royalties ranging up to the mid teens on net sales of collaboration products that are commercialized by Janssen.

With respect to the collaboration strategic value I would highlight several key points first we have partnered with one of the strongest oncology teams in the entire industry.

One with outstanding scientific clinical development and commercialization expertise, we will be building collaboration candidates using proprietary binding domains identified an optimized by janssen, creating the opportunity to develop highly differentiated products.

Scott Washko: We will be building collaboration candidates using proprietary binding domains identified and optimized by Janssen, creating the opportunity to develop highly differentiated products. Second, Janssen has committed substantial dollars to the collaboration's work plan. And we will be receiving significant annual research and development payments to drive innovation, including for the research and development of next-generation features and functionality, and for the scaling of our GMP manufacturing processes to support commercial-scale operations. Importantly, we have retained rights to this innovation for use across our IPSC product platform. Furthermore, the collaboration represents an opportunity for us to leverage our industry-leading IPSC product platform and expand our product pipeline. We have not encumbered our existing product pipeline in any way whatsoever.

Second Janssen has committed substantial dollars to the collaborations work plan.

And we will be receiving significant annual research and development payments to drive innovation, including for the research and development of next generation features and functionality and for the scaling of our GMP manufacturing processes to support commercial scale operations importantly, we.

Retained rights to this innovation for use across our IP FC product platform.

Furthermore, the collaboration represented represents an opportunity for us to leverage our industry, leading IP FC product platform and expand our product pipeline.

We have not encumbered, our existing product pipeline in any way whatsoever for each collaboration candidate we retain significant economic interest with the rights to opt into co commercialization and equal share of profits and losses in the U.S.

Scott Washko: For each collaboration candidate, we retain a significant economic interest, with the right to opt-in to co-commercialization and an equal share of profits and losses in the U.S. Lastly, I would highlight that we retain responsibility for the manufacture of the collaboration products. Under the collaboration, we have formed a joint manufacturing committee where Janssen can provide advice and support for our activities in building and scaling a world-class cell therapy manufacturing operation. I would like to thank the Janssen Oncology team. These are uncertain times, and we're all facing new challenges during this COVID-19 pandemic.

Lastly, I would highlight that we retain responsibility for the manufacturer of collaboration products.

Under the collaboration we have formed a joint manufacturing committee, where Janssen can provide advice and support for our activities in building in scaling a world class cell therapy manufacturing operation.

I would like to thank the Janssen oncology team.

These are uncertain times and we're all facing new challenges during this cobot 19 pandemic.

Janssen was unwavering in their commitment to this partnership and I'm really appreciative and sincerely grateful for the significant time and effort that Janssen dedicated to finalizing this collaboration in the midst of the pandemic and that the trust that the Janssen team has placed in our team.

Scott Washko: Janssen was unwavering in their commitment to this partnership, and I'm really appreciative and sincerely grateful for the significant time and effort that Janssen dedicated to finalizing this collaboration in the midst of the pandemic and the trust that the Janssen team placed in our team. I'm really excited to lead Fate Therapeutics as we begin this transformative collaboration together and dedicate ourselves to building novel, off-the-shelf CAR-NK and CAR-T cell cancer immunotherapies and bring life-changing medicines to patients. Turning to our financial results, revenue was $2.5 million for the first quarter of 2020 compared to $2.6 million for the same period last year. Revenue in the current quarter was derived from the company's IPS-derived CAR T-cell collaboration with Ono Pharmaceutical. Research and development expenses for the first quarter of 2020 were $29.3 million, compared to $17.7 million for the same period last year.

I'm really excited to lead fate therapeutics as we begin this transformative collaboration together and dedicate ourselves to build novel off the shelf coring tank car T cell cancer, Immunotherapies and bring like changing medicines to patients.

Turning to our financial results revenue was $2.5 million for the first quarter of 2020 compared to $2.6 million for the same period last year.

Scott Washko: The increase in our R&D expenses was attributable primarily to an increase in employee compensation, including share-based compensation, and expenses associated with the clinical development and manufacture of our product candidates, the conduct of research activities, including in our collaboration with ONO, and the facility lease for our new corporate headquarters. General and administrative expenses for the first quarter of 2020 were $7.7 million, compared to $5.4 million for the same period last year. The increase in our G&A expenses was attributable primarily to an increase in employee compensation, including share-based compensation, and in legal and accounting fees.

Revenue in the current quarter was derived from the company's IP EPS derived car T cell collaboration with Ono pharmaceutical.

Research and development expenses for the first quarter of 2020 were $29.3 million compared to $17.7 million for the same period last year.

The increase in our R&D expenses was attributable primarily to an increase in employee compensation, including share based compensation and expenses associated with the clinical development and manufacturer of our product candidates the conduct of research activities, including under our collaboration with Ono and the facility lease.

For our new corporate headquarters.

General and administrative expenses for the first quarter of 2020 were $7.7 million compared to $5.4 million for the same period last year.

The increase in our DNA expenses was attributable primarily to an increase in employee compensation, including share based compensation and in legal and accounting fees.

Total operating expenses for the first quarter of 2020 or $30.1 million net of noncash share based compensation expense of $6.9 million.

Scott Washko: Total operating expenses for the first quarter of 2020 were $30.1 million, net of non-cash share-based compensation expense of $6.9 million. The company ended the first quarter of 2020 with $219 million of cash, cash equivalents, and investments, which excludes $100 million received in April in connection with the Janssen collaboration. Common stock outstanding was 76 million shares, and preferred convertible stock outstanding was 2.8 million shares, each of which is convertible into five shares of common stock under certain conditions. Common Stock outstanding excludes the issuance of 1.6 million shares in April in connection with the Janssen collaboration.

The company ended the first quarter of 2020 with $219 million of cash cash equivalents in investments, which excludes $100 million received in April in connection with the Janssen collaboration.

Common stock outstanding was 76 million shares and pervert preferred preferred convertible stock outstanding was 2.8 million shares each of which is convertible into five shares of common stock under certain conditions common stock outstanding excludes the issuance of 1.6 million.

In shares in April in connection with the Janssen collaboration.

The global pandemic has shaken all our lives and many of US are experiencing first time challenges and significant instability.

Operator: The global pandemic has shaken all our lives, and many of us are experiencing first-time challenges and significant instability. I want to thank our employees for their passion, commitment, and resilience. I'm proud that we have demonstrated our ability to act swiftly in changing times and remained unwavering in our commitment to bring our pipeline of engineered, IPS-derived NK cells and T-cell cancer immunotherapies to patients during these unprecedented times. I sincerely hope that all of you and your family members are well and staying safe. And I'd now like to open up the call to questions. Thank you.

I want to thank our employees for their passion commitment and resiliency.

I'm proud that we have demonstrated our ability to act swiftly to changing times and remains unwavering and our commitment to bring our pipeline of engineered IP us drive NK cells and T cell cancer Immunotherapies to patients during these unprecedented times I.

I sincerely hope that all of you and your family members are well and staying safe.

And I'd now like to open up the call to questions. Thank you.

To ask the question you'll need to price start one on your talent.

Two.

Press the pound key.

Please stand by while we've compiled acuity roster.

Operator: Stand By While We Compile. Your first question?

First question comes from the line that Ted Tenthoff.

Sandler.

Great. Thank you guys. Congrats on good for all of the appeared across really are currently.

Ted: Great. Thank you, guys. Congrats on all of the updates across the pipeline. It's really exciting. I'm trying to get a sense for sort of where you see the applicability for 819 vis-a-vis other products in development and out there currently. I'm really excited to see that one advance into the clinic. And do you think we will most likely get data sometime next year? But I just want to get a little bit more color on 819. Thanks.

Clinical reference for sort of where your applicability for or growing.

Is of the other products in development and out there currently.

We're encouraged to see that were in advance into the clinic.

We think we were current Mercury cricket bid a company experiences from and get a little bit more color what Craig.

Sure Wayne is currently located in San Francisco Wayne can do you want to answer that take that question from Ted sure.

Wayne Chu: Sure. Wayne is currently located in San Francisco. Wayne, do you want to answer that, take that question from Ted?

So yeah, we're very excited about a tier one nine entering the clinic and I think this it raises settled some very intriguing development questions and possibility given the fact that we also have a product in F 30, 596 square or where based on what we know we should also expect to see activity and I think that the challenge from.

Wayne Chu: Sure. So, yeah, we're very excited about FT819 entering the clinic, and I think it raises some very intriguing development questions and possibilities, given the fact that we also have a product in FT596 where, based on what we know, we should also expect to see activity. And I think that the challenge from a clinical development perspective is, you know, finding indications that are most appropriate for the risk-benefit profile of each of the products as we gain clinical data in our Phase I studies. And so, I think that the answer to your question will largely be dictated by what we see in terms of efficacy and, more importantly, safety and tolerability, because that will then define, you know, what are the most appropriate indications within B-cell leukemia and lymphomas for which to more fully develop these products.

My clinical development perspective.

Is.

Finding indications that are most appropriate for the risk benefit profile of each of the products as we gain.

Clinical data in our phase one studies and so.

I think that the answer to your question will largely be dictated by what we see in terms of efficacy and.

More importantly, safety and Tolerability because that will then define what are the most overall appropriate indications within the so leukemias lymphomas.

In which to more fully developed these products.

Great. Thank you very much.

Okay.

Your next question comes from the line of broadband.

Hi.

Okay.

Suntrust Robinson.

Hi, guys. Thanks for taking my question.

Scott Washko: Great, thank you very much. Hi guys. Thanks for taking my question. Q1. So, first of all, just, you know, when COVID happened, I don't know what that data point you want to define as where, like, trials started getting impacted. Can you give us any sense of where you were in the timeframe of 516 and 510 or FD500 enrollment? Just, you know, how many patients were flowing through, just so we have a sense of when the trial might have gotten disrupted, and were there any missed visits? And then, secondly, on the deal, congratulations on the deal. How are you thinking about future deals, and does this agreement have anything that would prevent you from doing them? Thank you.

Q1, so first of all just when Kobin happens.

I don't know what that data point, when a defined as where like trial started getting impacted can you give us any sense of where you were in the timeframe of Fysixteen and 510 or.

500 enrollment on just how many patients were flowing through so we havent.

When the trial might have gotten disruptive and where there any I'm getting to that and then secondly on on the deal congratulation on the deal how are you thinking about future deals and does this agreement have anything that would prevent you from doing thank you.

Sure I'll do those in reverse order so.

Scott Washko: Sure, I'll do those in reverse order. So there's nothing in the Janssen deal that prevents us from doing future deals other than we are mutually exclusive with Janssen on the four antigen targets. So those four specific antigen targets, which are named, to be clear; we're working exclusively with Janssen on those four targets. So obviously, if you think of the space of cancer immunotherapy, there are countless targets that you could potentially pursue, and more are emerging each and every day.

There is theres nothing in the Janssen deal that prevents us from doing future deals other than we are mutually exclusive with janssen on the four antigen targets. So those four specific antigen targets, which are named to be clear, we're working exclusively with Janssen on those four targets.

So obviously, if you think of the space of cancer immunotherapy. There are countless targets that you could potentially pursue end.

Scott Washko: And so, yes, we absolutely have the opportunity to continue to do partnerships as we think about continuing to build our pipeline and leverage our platform. I think one of the exciting things that I mentioned, for instance, on this call is that we are continuing to evolve our pipeline and our platform, where we are creating multiplexed engineered product candidates. For instance, FT538 already has three engineered pieces of functionality in that cell product. We can use that now as a backbone, essentially, to create new product candidates starting with that as the starting material. So I think our ability to develop highly multiplexed engineered product candidates is really exciting and is one of the things that we think and I think partners think is very attractive about our platform as we think about how to, for instance, attack solid tumors, as an example, where I think it's going to take potentially highly engineered and edited solutions.

All of our pipeline and our platform, where we are creating multiplexed engineered product candidates for instance, F. 35, 38 already has three engineered pieces of functionality in that sell product. We can use that now as a backbone essentially to create new pro.

Product candidates, starting with that as the starting material. So I think our ability to do develop highly multiplexed engineered product candidates is really exciting and is one of the things that we think and I think partners I think.

He is very attractive without our platform as we think about how to for instance, a tax solid tumors. As an example, where I think it's going to take on potentially highly edited highly engineered in edited solutions with respect to.

Scott Washko: With respect to where we were in the trials, I agree that you can sort of debate when COVID hit, but we were in the midst, with respect to FT500, we were in the midst of finishing the 300 million cell dose in the dose expansion, or sorry, dose escalation stage, which we successfully completed, and to my knowledge, there were not any missed visits when we completed dose escalation at 300 million cells per dose. So I talked about the results on the call, obviously, we're super excited, and continue to see really strong safety and tolerability, including it going out into the second cycle where patients had received all six doses. With respect to FT-516, it's early. I mean, we treated the first patients in dose escalation, I think, in late October, and so we were just working our way early through dose escalation in the FT-516 program.

That where we were on the trials.

Yes, I agree you can sort of debate when covert hit.

What we were in the midst with respect to 5500, we were in the midst of finishing the 300 million cell dose in the dose expansion or sorry dose escalation stage, which we successfully completed and to my knowledge there were not any mr. visits in completing dose escalation.

At 300 million cells per dose and so I talked about the results on the call. Obviously, we're super excited continued to see really strong safety and Tolerability.

Including at going out.

Into the second cycle, where patients had received all six doses.

With respect to Ft Fysixteen, it's early I mean, we treated the first patients in dose escalation I think in late October and so we were just working our way early through dose escalation in the ft Fysixteen program.

Got it.

I would also just add that as Scott mentioned, we were in the midst of dose escalation in all of our active trials when the Kogut 19 situation became such that there were rules at the institutional level to restrict patients coming on to phase one trial.

Wayne Chu: I would also just add that, as Scott mentioned, we were in the midst of dose escalation in all of our active trials when the COVID-19 situation became such that there were rules at the institutional level to restrict patients coming on to phase one trials. And so we've been monitoring, you know, the institutional guidelines very closely and have been in very constant communication with investigators to ensure that patients who are on the trials are being monitored appropriately. And for the most part, you know, despite the COVID-19 situation, patients are still adhering to their schedules with respect to monitoring, even to the point of still continuing to come into clinic to have, you know, physical exams and lab draws and things like that.

And so we've been monitoring.

The institutional guidelines very closely and going in very constant communication with investigators to ensuring that patients who are on the trials are being monitored appropriately and for the most part.

Despite the coping 19 situation patients are still adhering to there.

To their schedules with respect to monitoring.

You into the point of still continuing to come into clinic to have physical exams and lab jaws and things like that.

But cognizant of the impact of Kogan 19, we have worked actively with clinical sites to ensure the possibility of remote monitoring and other contingencies in cases, where patients are unable to come to the clinic.

Wayne Chu: But, you know, cognizant of the impact of COVID-19, we have worked actively with clinical sites to ensure the possibility of remote monitoring and other contingencies in cases where patients are unable to come to the clinic. Hi guys, congrats on all the progress. There is a lot to cover, so I will ask a couple questions. I guess, number one, could you just talk about how your platform allows you to be opportunistic as sites reopen for patient dosing? Have you been able to ship all those doses that you mentioned to different sites and maybe compare how you're able to be opportunistic as sites open versus other cell therapies?

Your next question comes from the line up Chandler.

Okay, No Wells Fargo.

Hi, guys. Congrats on all the progress a lot to cover so.

A couple of questions I guess number one could you just talk about how your platform allows you to be opportunistic at sites reopen for patient dosing have you been able to ship all those doses that you mentioned to different sites and and maybe compare how you're able to be opportunistic as sites opened per sub assault therapies.

Yes, I think I think it's one of the unique advantages that we have.

Scott Washko: Yeah, I think it's one of the unique advantages that we have. Obviously, with an iPSC cell platform, you have the ability to truly have an off-the-shelf product paradigm much closer to something like a monoclonal antibody therapy. So yes, we absolutely have hundreds of manufactured doses that are already cryopreserved. However, we have redundancies with respect to where those doses are housed. Certainly, some of the doses are housed at our distributor. We have a distributor. But we absolutely have stocked our clinical sites with doses, and so our clinical sites have doses stored on site. And obviously, we're also promoting an outpatient paradigm for being able to treat patients. So as we come out and try and emerge from this COVID-19 pandemic, I do think we're in a really unique situation where we can potentially accelerate out of it in a much quicker fashion than we might otherwise face if we were doing traditional cell-based therapy where you were requiring sourcing patient or donor cells for every batch-to-batch

Obviously with an IPO cell platform you have the ability for to truly haven off the shelf on product patter paradigm much much closer to more like a monoclonal antibody therapy. So yes, we absolutely have hundreds of manufacturer doses that are already cryopreserved, we have redundancies with respect to where they.

Those doses are housed certainly some of the doses are housed at our distributor we have a distributor.

Other but we absolutely have stock to on our clinical sites with doses and so our clinical sites have doses stored on site.

In a much much quicker fashion than we might otherwise face. If we were doing traditional on cell based therapy, where you were requiring sourcing patient or donor cells for every batch to batch manufacturing Ron.

And then maybe just Scott calling up on the Janssen deal and congrats on that real.

Scott Washko: And then maybe just Scott, following up on the Janssen deal and congrats on that deal. For the individual targets that get selected, is there anything that prevents Janssen from pursuing ADCs or bispecific antibodies or naked antibodies for the same target? And if they do, is there some provision where, you know, they make your iPSC-derived cell therapy a priority? We've seen that in other instances where the CAR-T, as an example, is the leader, and then it's followed very quickly by a bispecific or an ADC. Is there anything to protect against that in the collaboration?

For the individual targets that selected is there anything that prevents janssen from pursuing 80 Cesar.

By specific antibodies are naked antibodies for the same target and if they do is there some some provision where.

They make your IP FC derived cell therapy, a priority just we've seen that another instances where the car T. As an example is the leader and then its fall very quickly buyer a bi specific current AIDC is there anything to protect against that in the collaboration.

Theres theres nothing to necessarily protect against that in the collaboration.

Scott Washko: There's nothing necessarily to protect against that in the collaboration. The reverse might be true in this collaboration, where they may already have a bispecific, which we are creating a CAR NK or CAR T cell product out of it using a binding domain that may actually already be in late stage preclinical or clinical validation.

The reverse might be true in this collaboration where they may.

Already have a bi specific which we are.

Creating a car and care car T cell product out of it using a binding domain that may actually already be in late stage preclinical or clinically validated.

Just one final one Scott on the on the deal you mentioned that they theres no overlap with with anything you're working on internally at Feight do they have access though to the F. 35, 38 Master cell bank could be make use of that for kind of accelerate the development of a partner assets.

Scott Washko: There's one final one, Scott, on the deal. You mentioned that there's no overlap with anything you're working on internally at Fate. Do they have access, though, to the FT-538 Master Cell Bank? Could they make use of that to kind of accelerate the development of the partner assets?

So they ought to be clear they don't have access to it but certainly we can use it their head janssen to be clear as handing us the binding domains and we are building in a car constructs and so.

Scott Washko: So, to be clear, they don't have access to it, but certainly we can use it. Janssen, to be clear, is handing us the binding domains, and we are building the car constructs. And so, I think, you know, the direction you're headed in. Where might we see first-generation product candidates under the collaboration that arise using FT-538 as a backbone? Yes, that's a distinct possibility.

I think the direction, you're headed in where might we see first generation product candidates under the collaboration that our rise using F. T 538, as a backbone, yes, that's a distinct possibility.

Great well, thanks for taking the questions congrats on all the progress.

Operator: Great. Well, thanks for taking the questions, and congrats again on all the progress.

Thank you.

Scott Washko: Thank you.

Your next question comes from Ali.

Ken tools.

Hey, guys. Thanks for taking my question Mark to and congrats on the progress one I just kind of curious about how you're thinking about clinical trial sites like expanding them I know I reference maybe some potential additional sites I just wonder how much of a strategy will that play and it also seems like interestingly have long 10, and then when you look at the.

Operator: Hey guys, thanks for taking my question, or two, and congrats on the progress. One, I was just kind of curious about how you're thinking about clinical trial sites, like expanding them. I noticed you referenced potential additional sites, so I just wondered how much of a strategy that will be. And it also seems like an interesting move long-term. And then, you know, when you look at the Janssen collaboration, I guess, what's the one piece you think that really is the big secret sauce? Is it the manufacturing capability, or is it just the natural synergy that you have? Like, what are you?

Janssen collaboration I guess, what's the one piece you think that really is that big cigarettes off the manufacturing facility or the natural Sagitta you had like what do you really think is like the value add I'm sure. There was a lot of interest and if people don't have dealt with you guys. Thanks.

Scott Washko: I really think it's like the value add. I'm sure there was a lot of interest in it.

Scott Washko: We have people doing a deal with you guys. Thanks.

Sure I would say on with respect to clinical sites, yes, I mean, we're going to be aggressive in adding clinical sites I think one of the unique opportunities that we have.

Scott Washko: Sure. I would say, with respect to clinical sites, yeah, I mean, we're going to be aggressive in adding clinical sites. I think one of the unique opportunities that we have, having potentially outpatient therapy and having product that's available off the shelf, is that we can move away from the, you know, centers of excellence like, for instance, Memorial Sloan-Kettering or MD Anderson, which have obviously, you know, pioneered CAR T-cell therapy. There's a tremendous amount of competition, obviously, at those centers of excellence with respect to delivering product.

Having a potentially outpatient therapy in having product that's available off the shelf is that we can move away from the centers of excellence like for instance, a memorial Sloan Kettering or an MD Anderson, which have obviously pioneered car T cell.

Scott Washko: I think we have the opportunity to broaden the number of clinical sites that we potentially go to, given the off-the-shelf nature of our product candidate. With respect to the Anson collaboration, I think there's, I mean, I think there's multiple points of value that, you know, we see in our product pipeline and we see in our platform and that we hope others also see in this platform. I think one of the, you know, differentiating features of what we do, and I sort of just alluded to it in the response to Jim, was this notion that I think folks do believe as we move forward in the next, you know, two, three, five years, in order to really address solid tumors, we will have multiplexed engineered functionality embedded into cell therapy.

Differentiating features of what we do and I sort of just alluded to with the response to Jim was this notion that I think folks do believes as we move forward in the next 235 years in order to really address solid tumors.

We will have multiplexed engineered functionality embedded into cell therapies.

And I think thats very challenging to do 345 edits.

Scott Washko: And I think that's very challenging to do three, four, five edits batch by batch at a cell population level. And so being able to, for instance, engineer a single cell, characterize a single cell with three, four, five edits, and use that in a renewable fashion as a starting material, I think just provides some really, really powerful advantages as you think about cell therapy going forward. I think that's one of the really distinguishing features of what we do, being able to collapse all the engineering into literally a one-time event.

Batch by batch at a cell population level.

And so being able to for instance engineer a single cell Im characterize a single cell with 345 edits and use that in a renewable fashion as a starting material I think just provide some really really powerful advantages.

As you think as you think about cell therapy going forward I think thats one of the.

Just really distinguishing features of what we do being able to collapse all the engineering into literally a onetime event.

Great. Thank you very much.

Scott Washko: Great, thank you very much. Sure. Our next question... Hi, this is Carly on behalf of Yigal. Thanks very much for taking our questions. The first question we had was about the ongoing FT516 trial. Can you just give a sense for where you are in the dose escalation and then what you see as kind of the key learnings from the next data update in the context of your longer-term strategy for this program?

Sure.

Your next question comes from your call Docomo Viets cities.

Hi. This is currently on bank all thanks for taking my question.

Next question the headwinds very small aktiv teen ongoing Paul can you just single Encore Ray you are in the dose escalation and then what you see.

Scott Washko: For FT-516, yeah, for FT-516, we were still early in dose escalation when, obviously, the COVID pandemic hit. We're continuing to add sites to the FT-516 program.

And in the key learnings from the next day to day in the context, Thank you and your longer term strategy Sir.

For actually Fysixteen, yet Foresi Fysixteen, we were we're still early in dose escalation.

When obviously the coven pandemic hit.

We're continuing to add sites to the FTC Fysixteen program I think FC Fysixteen. If you look at it. It is the first engineered IP us derived cell therapy to Cdsixteen receptor. We think is really novel and powerful because we can use it to hit multiple antigen targets and so.

Scott Washko: I think, you know, FT-516, if you look at it, it is the first engineered IPS-derived cell therapy. The CD16 receptor, we think, is really novel and powerful because we can use it to hit multiple antigen targets. And so getting that first glimpse of using, for instance, FT-516 in combination with monoclonal antibody therapy, in this case Rituxan, I think is going to be really interesting to us. And I'd also say that, you know, the setting for FT-516 as monotherapy is AML. And there's a lot of historical precedent with respect to the use of donor-derived NK cells in the AML setting. And so being able to, for instance, benchmark over time a product candidate like FT-516.

Scott Washko: or...

Getting that first blends of using for instance, ft 516 in combination with monoclonal antibody therapy. In this case were toxin I think is going to be really interesting to us I'd also say that.

The setting for 50 516 as a monotherapy is AML.

And there's a lot of historical precedent with respect to the use of donor derived NK cells in the AML setting.

And so being able to for instance, benchmark overtime a product candidate like 50, 516 or 50 538 in this setting of AML.

Scott Washko: FT-538 in the setting of AML, I think could be really interesting and potentially a really powerful therapeutic given the precedent that exists with respect to NK cells and anti-leukemic activity in the AML setting.

I think could be really interesting and potentially is a really powerful therapeutic given the precedent that exists with respect to NK cells and anti leukemic activity in the in the AML setting.

Got it.

And then let Anthony Hammill prior questions around against PDL and potential future partnering opportunities can you talk about that process.

Scott Washko: Got it. That's helpful. And then, building on some of the prior questions around the Janssen deal and potential future partnering opportunities, can you talk about the process and the kind of timelines associated with developing an IPSC-derived product candidate once, you know, a partner comes to you with a desired target?

And of the timelines.

Ed with enveloping IPO Phedre product candidate.

Our partner continue with desired target.

Yes, I think it depends a little bit.

Scott Washko: Yeah, I think it depends a little bit. It depends on, and I've said this before, Fate Therapeutics is not necessarily today an expert in developing, identifying, and developing the latest and greatest cancer targets or binding domains and optimizing binding domains to access those targets. So it really does depend, as an example, on what the partner might be contributing at day one to the collaboration. So in the case of Janssen, at least some of the antigen targets we've talked about, Janssen is showing up at some level with, you know, a validated binding domain that they're excited about. And so if someone, for instance, were able to hand us a validated binding domain and we built a car construct and dropped it into, for instance, the FT538 backbone, we potentially could have an IND candidate in, you know, 18 months. Let's just pick 18 months as a reasonable time frame. But that depends, and that's really incumbent on, you know, a partner having confidence in contributing a validated binding domain around which we could build a CAR-NK or CAR-T cell product.

It depends on and I've said this before fate therapeutics is not necessarily today, an expert in developing in identifying and developing the latest and greatest cancer targets or binding domains and optimizing binding domains to access those targets. So it really does depend on.

As an example, what the partner might be contributing.

At day, one to the collaboration so in the case of Janssen at least some of the antigen targets we've talked about.

Candidate in.

18 months, let's just pick 18 months as a reasonable timeframe.

But that dependent that's really income than on a partner.

Having confidence in contributing a validated binding domain around which we could build a car and care car T cell product.

Great. That's really helpful. Thanks for taking my question.

Scott Washko: Great! That's really helpful.

Sure.

Your next question comes from Dana Grey box.

The Larry.

Hi, Thanks, a question a couple of the first one is if you could just help us understand when we might see some clinical data for Sq Fiveninety six primarily but also fysixteen 500, encoder immune which I think maybe you had initially thought we'd see data in second half.

Scott Washko: Thanks for taking the question. Hi, thanks for the questions. A couple. The first one is if you could just help us understand when we might see some clinical data for FT596 primarily, but also 516500 and protomune, which I think maybe you had initially thought we'd see data in the second half.

Yes, so with respect to uptake OMS sort of wanted to time, so with Prodemand I'll start with actually programming with Permian. We I think we announced we fully enroll enrolled the program in study in I want to say November of 2019, and so proud immune has.

Scott Washko: Yeah, so with respect to, I'll take them sort of one at a time. So with Protoimmune, I'll start with actually Protoimmune. With Protoimmune, I think we announced we fully enrolled the Protoimmune study in, I wanna say, November of 2019. And so, Proto-Immune has two key data sets associated with it. There's a day 100 data set where we're looking at the cumulative incidence of grade two through four GVHD. And so obviously, our patients have fully progressed through that day 100 endpoint. And then there's this key secondary endpoint, which really captures the totality of the hematopoietic stem cell transplant outcome. And so, for instance, it's a composite endpoint of moderate to severe chronic GVHD, relapse, and survival. So, an endpoint that's commonly referred to as GRFS.

Two key data sets associated with it Theres a day 100 dataset, we're looking at cumulative incidence of grade two through four gvhd.

And so obviously, our patients who have fully progress through that day 100 endpoint.

And then there is key secondary endpoint and the key secondary endpoint really captures the totality of the hematopoietic stem cell transplant outcome and so for instance, it's a composite endpoint of moderate to severe chronic gvhd relapse and survive.

Well, so GE as an endpoint, that's commonly referred to as GE RFS and Thats a day 365 retail the study will be blinded is currently blinded and we'll stay blinded throughout the assessment of both day 100 day 365. So if you think about like when we will hit dates.

Scott Washko: And that's a day 365 readout. The study will be blinded, is currently blinded, and will stay blinded throughout the assessment of both day 100 and day 365. So, if you think about, like, when we will hit day 365, we likely will not have protein data until the first half of 2021, if I did all that math correctly. With respect to the IPS-derived programs, FT500, FT516, FT596, we're not going to go patient by patient with respect to data, so we will not do that. We will wait until we have essentially an informative group of patients through dose escalation and then provide that type of data. Obviously, we have been delayed, and we think there's going to be some delays with respect to new site initiation and patient enrollment because of the COVID pandemic. And so, you know, we will provide more transparency as we approach the enrollment and the disclosure dates for the clinical data.

265 would likely will not have protein data until the first half of 2021.

I did all that math correctly.

With respect to the IP us drive programs Ft, 500 ft Fysixteen ft 596.

We're not going to go patient by patient with respect to data. So we will not do that we will wait until we have essentially and informative group of patients.

Through dose escalation and then provide that type of data.

Obviously, we have been delayed and we think theres going to be some delays with respect to new site initiation and patient enrollment new patient enrollment because of the coded pandemic and so we will provide more transparency as we approach.

The enrollment and the disclosure dates for the clinical data.

Okay and then my second question on the whole on that completely different and fair, that's new Pan tumor Mick HP.

Scott Washko: And then my second question, on the completely different end, for this new pan-tumor MYC-AB target, I don't think you mentioned whether it's a CAR-NK or a CAR-T. I wonder if you can speak to that, and how close it is to the Celiad CAR-T program and maybe what you've learned from that program as you take yours into the clinic.

Target I don't think you mentioned there at the car and K. our car T 100, beacon speak to that and how close is that to the Sally add car T program and maybe what you've learned from that program as you take care in the clinic.

Sure.

Scott Washko: Sure, I'll touch on this at a high level because we're about to disclose this at ASGCT. So at ASGCT, you will see data both with respect to CARMIC A and MICB in both NK cells and T cells. So you'll see some initial data in both as it relates to CARMIC A and MICB. With respect to other types of programs, I would say, you know, we've obviously looked a lot at NKG2D and its ability, given it's sort of a key activating receptor on NK cells. The targets of NKG2D commonly, like MICA, MICB, can shed. And so that is one, I think, that is one of the significant differentiation, differentiating features of this program is that we're all very familiar with mechanisms associated with T cell escape.

I'll touch us at a high level because we're about to disclose this at asked GCT. So at AC and ask GCT you will see data both with respect to Karma gaming be in both NK cells and T cells. So you'll see some initial data in both.

As it relates to Karma gaming be.

With respect to other types of programs I would say.

We've obviously looked a lot and kgtv.

With risk and its ability given it's a sort of a key activating receptor on NK cells.

Targets of Encaje GTD, commonly like mid gaming be can shed and.

And so that is one I think that is I think that one of the significant differentiation differentiating features of this program is we're all very familiar of mechanisms associated with T cell escape.

I think theres more and more data now emerging that NK cell tumor escape also exists and this is potentially one of the prominent mechanisms.

Scott Washko: I think there's more and more data now emerging that NK cell tumor escape also exists, and this is potentially one of the prominent mechanisms. The shedding of stress ligands on tumor cells is potentially a very prominent mechanism of tumor escape, especially in solid tumors. And that's what we were really intrigued about with respect to this program because we think this program, targeting the McA, McB, and we'll get into it, but the alpha-3 domain specifically of the ligand, we can overcome the shedding and NK cell escape.

The shedding of stressed ligands on tumor cells is potentially a very prominent mechanism of tumor escape, especially in solid tumors and that's what we're really intrigued about with respect to this program because we think this program and targeting the game make be any and we'll get into the alpha three domain specifically of the law.

And again, we can overcome the shedding and NK cell escape.

That's very helpful. Thank you.

Scott Washko: That's very helpful. Thank you.

Sure.

Your next question, perhaps from David Ari Erin Garden.

The security.

Hi, Thanks, and then a question on does have a coupon on thinking about.

Wayne Chu: Hey, thanks for taking the question. I just had a quick one on thinking about the autologous transplant setting in K596. Our 596 program. Yeah, this has been a goal for quite some time to, you know, prevent relapses and transplants. And I was just wondering, you know, how you were thinking about the end point, disposition of patients, or, you know, just generally if you could provide any more detail on that study in Minnesota. Thanks.

Auger.

Our program.

Fivenine bricks.

Our private access program.

Yes. This has been a goal for quite some time to present relapses and that transplants and I was wondering now heizer thinking about the clients are disposition of patients or just generally as you for providing more detail.

That study it in Minnesota Thanks.

Sure are weighing do you want to take that.

Wayne Chu: Sure, Wayne. Do you want to take this?

Yes so.

Wayne Chu: Yes, so, um... As you mentioned, prevention of relapse in the autologous stem cell transplant setting for patients with aggressive lymphomas still remains an unmet medical need. And so, with respect to this specific study, I think there are a few things to point out. First, the patient population that's selected is patients with known high risk of disease that are defined both by biologic characteristics as well as their response to initial immunochemotherapy. So, patients who've had relatively poor responses to things like RCHOP and then come on and receive salvaged immunochemotherapy followed by a stem cell transplant are the eligible population for this. And so, this population was picked in large part because, you know, the survival outcomes for these patients, even when they are able to get to the transplant situation, are relatively poor, with relatively short event-free survival and progression-free survival. And so, the purpose of this study is to see whether or not the addition of FT596 in the post-autologous stem cell transplant setting results in prolonged progression-free survival and event-free survival, which are among the important endpoints of this study.

So.

As you mentioned.

Wayne Chu: And, I mean, is 18 patients the right number to start, sorry for the quick follow-up, you know, the right number to see that when you stratify by risk factors or, you know, are these patients because there are, you know, maybe they didn't get to completely, or they didn't experience a complete response or a partial response with, you know, what's the frequency of relapse in the next six or 12 months? Or, you know, basically how quickly could we see a potential divergence in outcomes between patients treated with 596? Yeah, so those are good questions.

Invention of relapse on many autologous stem cell transplant setting for patients with.

With aggressive lymphomas still remains an unmet medical need and so with respect to this specific study I think a few things to point out first is the patient population. That's a selected our patients with known high risk.

Wayne Chu: But I think it's also worth remembering that, you know, one of the primary endpoints of the study is also to understand the safety and tolerability of FT-596 in the post-transplant setting. And so the 18 patients is admittedly a small number, but it's really, you know, in large part, to characterize safety and tolerability. And it really depends on how, you know, the clinical tolerability is with, you know, the first set of patients, and if there's any compelling evidence of activity, then we would definitely expand, consider expanding the number of patients in order to get to a number of patients that allow us to more robustly determine whether or not the outcomes are better than current standard care. And I think in that regard, particularly in patients who don't achieve a deep response So if you treat patients, you know, on the study and you find that, you know, a fair proportion of these are having event-free survival in excess of that, then there will be opportunities to expand the study to get a more precise read on that. All right. Thank you. Hi guys. Thanks for taking the time to answer my questions.

These that are defined both biologic characteristics as well as their response to initial.

Immuno chemotherapy, so patients who had relatively delays.

Relatively poor responses to things like our chop.

And then come on and receive salvage immunotherapy, followed by stem cell transplant. That's the eligible population for this and so this population was picked in large part because the survival outcomes for these patients even when they are able to get to the transplant situation are relatively.

Or with relatively short embedded free survival in progression free survival and so the purpose of this study is to see whether or not. The addition of ft 596 in the post autologous stem cell transplant setting our results and prolonged progression free survival in event free survival, which are among the important.

And points of this study.

And I mean are it's 18 patients are right number to start sorry for a quick follow up the right members.

Stratified by risk factors or.

Are these patients because there.

Maybe they didnt get to completely related.

Experienced a complete response or partial responses.

What's the frequency of relapse summer and the next six or 12 concert basically how quickly could we.

Yes, essential divergence and outcomes with patients treated with five metrics.

Yes, so good questions, but I think it's also worth remembering that the one of the primary endpoints of this study is also to understand the safety and Tolerability of 50 596 in the post transplant setting and so the 18 patients is admittedly a small number but it's really.

A large part to characterize the safety and Tolerability and it really depends on how.

The clinical Tolerability is with the first set of patients that if theres any compelling.

Evidence of activity than we would definitely expand consider expanding the number of patients in order to get to a number patient that allow us to more robustly.

Determine whether or not at the outcomes are better than current standard of care and I think in that regard, particularly in patients who don't achieve.

It keep response with initial im going to chemotherapy great outcomes for these patients even when they get to transplant, you're talking about have been free survival measure.

Less than a year.

And and progression free survival similarly, less than a year. So if you treat patients on study and you find that fair proportion of these are our having.

Event free survival in excess of that then there will be opportunities.

To expand the study to get a more precise read on that.

Got it thank you.

Your next question comes from Biren Amin Mccaffrey.

Hi, guys. Thanks for taking my questions, maybe on 500 500.

Scott Washko: Maybe on 500, FT500, you've announced that you've dosed three patients with 300 million cells in combination with checkpoints. Can you just talk about how many cell doses the patients received? And I guess, can you maybe talk about the background of the patient in terms of tumor type? In particular, did you have any patients with non-small cell lung cancer? Would you like me to..., expand into that setting?

You've announced that Youve dose three patients with 300 million cells in combination with checkpoints can you just talk about how many sell doses.

The patients received and.

I guess can you maybe talk about the background of the patient in terms of tumor type in particular did you have any patients with non small cell lung cancer would you let you too.

Expand into that setting.

Yes. So this is this is Scott. So these were the last three patients in the dose escalation phase of this study that we had treated.

Scott Washko: Yeah, so this is Scott. So these were the last three patients in the dose escalation phase of the study that we had treated. All three patients were eligible to receive the second cycle, and you should assume that some of the patients, at least some of the patients, received all six doses. So there the hypothesis, as you know, the phase one study, whether it be monotherapy or checkpoint inhibitor combination, the hypothesis of the study really initially was a basket study to look at safety and look at the tolerability of the initial dose. We certainly did not enrich for non-small cell lung cancer patients in the all-comers dose escalation phase. With respect to expansion, this is where, you know, we're taking a biological bet, if you will.

All three patients were eligible to receive the second cycle.

And you should assume some of the patients at least some of the patients received all six doses. So.

They are the hypothesis as you know the phase one study whether it be monotherapy or checkpoint inhibitor combination. The hypothesis of the study really initially was a basket study to look at safety and look at the Tolerability of of initial dose we certainly did.

Not in rich for non small cell lung cancer patients in the all comers dose escalation phase with respect to expansion.

This this is where we're taking a biological that if we if you will we think it is well informed based on the literature. That's out there with respect to and there is a significant body of literature out there with respect to checkpoint inhibitor in non small cell lung cancer and for instance, the mutations that lead to.

Scott Washko: We think it is well-informed based on the literature that's out there with respect to, and there's a significant body of literature out there with respect to checkpoint inhibitors and non-small cell lung cancer. And for instance, the mutations that lead to downregulation in MHC class one, which is where we think NK cells might have a very unique advantage in attacking those types of tumors. So I would say the hypothesis in going after non-small cell lung cancer is not necessarily driven by the clinical data that we observed in dose escalation, but more based on what we've been able to glean, including talking to KOLs in the checkpoint inhibitor space around non-small cell lung cancer as it's practiced today with checkpoint inhibitors.

Down regulation NMHC class, one, which is where we think NK cells might have a very unique advantage in attacking those types of tumors. So I would say the hypothesis in going after non small cell lung cancer is not necessarily driven by the clinical data that we observed in dose.

Escalation or more based on what we've been able to glean any including talking to Kao wells in the checkpoint inhibitor space around non small cell lung cancer as its practice today with checkpoint inhibitor.

And Scott for the non small cell cancer cell lung cancer study.

Scott Washko: And Scott, for the non-small cell lung cancer study, what type of IL-2 support will patients be required to have? Can you just maybe provide additional color on that, as well as whether you are enrolling patients with certain PD-L1 baseline, TMD, or CD3 counts?

What type of aisle to support will patients be required to have can you just maybe provide additional color on that as well as are are you enrolling patients with certain PDL, one baseline TMB or cdthree Hal.

Yes, and so we are not grow today, we are not necessarily ROE specter of lease selecting on M. A C class one level, we are doing pretty tight tumor biopsy. So that is mandatory to get a pre treatment biopsy must have that and so we will absolutely be able.

Scott Washko: Yeah, and so we are not, today we are not necessarily prospectively selecting on MHC class 1 level. We are doing pre-tumor biopsy, so that is mandatory to get a pre-treatment biopsy, must have that, and so we will absolutely be able to classify MHC class 1 expression levels as we enroll patients. We will have that information, and so that will be helpful to us. With respect to IL-2 support, we're excited about adding IL-2 because, you know, we think that's important in order to activate, properly activate the NK cells to the best of their ability, and we will be giving a sub-therapeutic dose, but we give a sub-therapeutic dose essentially with each dose of FT-5.

To classify.

May see class one expression levels as we enroll patients we will have that information and so that will be helpful to us with respect to aisle to support we're excited about adding I'll too because we think thats important in order to activate properly activate the NK cells to the best of their ability and we will be giving a it's a slow.

Subs therapeutic dose, but we give a sub therapeutic dose essentially with each dose of ft 500.

Okay, great. Thank you.

Scott Washko: Okay, great. Thank you. Hi, can you hear me?

Sure.

Your next question comes from Mara Goldstein with Mizuho.

Hi can you hear me.

Yes. Thank you.

Operator: Thank you. So, I wanted to ask you two questions, one with respect to MICA and MICA-B. You know, they're not the only stress ligands, so I'm just wondering if there is, if you're able to sort of quantify what that loss is in tumors and relative to what would necessarily be normal and compared to sort of the broader group of stress ligands that are affected by this process. And so, I'm curious about that from that perspective. And then, just on the CAR-BCMA, I'm just wondering what you can point to from at least a preclinical perspective that can show us differentiation between sort of where you're going with yours.

So I wanted to ask two questions one win with respect to mechanic bank and make that timing Gabby.

No.

Now the only specified and so I'm just wondering.

There is if it if that if you're able to sort of quantify what that losses and tumors and relative to what would necessarily be normal and compare Q citizen broader group stratify gains that are affected.

From this process and and so I'm curious about that from that perspective and then.

Just on that Carby, Ken I'm, just wondering what you can point us to pharma.

Preclinical perspective that can show us differentiation between where you're going radio anywhere versus where initially on this right now.

Sure with recovery with respect to car Bcm, a at I'd sort of asked you to hold your question for about two days because the 50 576 poster is going to be presented asked GCT as well I.

Scott Washko: Sure. With respect to CAR-BCMA, I'd sort of ask you to hold your question for about two days, because the FT576 poster is going to be presented, and ASGCT as well, I think on Wednesday or Thursday of this week. And so you will see sort of the differentiating features of FT576, which again includes, and we are big believers in this, the ability to attack multiple antigens at the same time. And so we think that's one of the unique advantages of the product candidate, not that it's just off the shelf, but we will be able to do multi-antigen targeting, for instance, in combination with an anti-CD38 MAB, as an example And so we're excited about that.

I think on Wednesday, or Thursday of this week and so you will see sort of the different some of the differentiating features of that T 5676, which again includes and we're big believers in this the ability to to attack multiple antigens at the same time and so we think thats one of the unique advantages with the product candidate not that it's just off the.

A shelf, but we will be able to do multi antigen targeting for instance in combination with an anti cdthirty eight mab as an example, not just the car bcm.

And so we're excited about that with respect to make gaming I mean, it's early totally agree that there are multiple stress logins that can be expressed by tumor cells.

Scott Washko: With respect to MYC-A and MYC-B, I mean, it's early. I totally agree that there are multiple stress ligands that can be expressed by tumor cells, and obviously, NK cells can interact with those types of stress ligands. It's one of the reasons we're excited about NK cells is because NK cells have a sort of an array of activating receptors that can interact with these stress ligands. I would say if you look at certain solid tumors, and I'm happy to send you some papers on this, MYC-A, and MYC-B as a ligand are predominantly expressed on certain solid tumors as the stress lig And so we think it is a very significant target to go after. It is a target, as we mentioned, that is absolutely subject to shedding, though, and I think one of the challenges that are emerging in the setting of solid tumors is that these tumors are very smart and crafty, and they have mechanisms to escape T cell recognition as well as NK cell recognition. And so, you know, targeting these stress ligands in a way where you can access the solid tumor, engage the solid tumor, and overcome these escape mechanisms is something we're super excited about. All right, thanks.

Obviously NK cells can interact with those types of stress ligands.

It's one of the reasons. We're excited about NK cells is because NK cells have sort of an array of activating receptors that can interact with the strict stress ligands I would say if you look at certain solid tumors and I'm happy to send you. Some papers on this mic game mic be as alive again is a predominantly express.

Based on certain solid tumors as the stress ligand.

And so we think it is a very significant target for which to go. After it is a target as we mentioned that is absolutely subject to shedding, though and I think it's one of the challenges that's emerging in this setting a solid tumors is that these tumors are very smart and crafty and they have mechanisms to.

To assist to escape T cell recognition as well as NK cell recognition.

And so targeting these stressed ligands in a way where you can access the solid tumor engage the solid tumor and overcome these escape mechanisms is something we're super excited about.

Alright, Thanks I appreciate it.

Operator: Alright, thanks, I appreciate it. Good afternoon.

The next question comes from the line up Ben Bernanke.

Diesel.

Good afternoon. Thanks, so much for taking my questions.

Scott Washko: Thanks so much for taking my questions. Sure. I guess, first, can you just talk about the 516 study for COVID-19? Specifically, what exactly is FATE's role here? You know, I'm just curious if you could talk about the resources that you'd be responsible for for that program. And then, just as a quick follow-up, how does this impact 516 inventories as it relates to company-sponsored trials?

I guess first can you just talked about the 516 study for Koby 19, specifically.

What exactly it states role here.

Just curious if you can talk to the resources that you'd be responsible for.

For that program and then just as a quick follow up how does this impact by fixing inventories as it relates to the company sponsored trials. Thanks, so much.

Sure So I.

Scott Washko: So I... Let the second part of your question first. I mean, it's not a significant drain on our inventory with respect to, you know, the inventory we have on hand with respect to FT-516. You should assume that we've done more than one manufacturing run for FT-516, and we have hundreds of doses that are, in fact, available. With respect to, you know, how this all came about, we actually did not initiate the discussions here.

Let your second second part your question first I mean, it's it's not a significant drain on our inventory with respect to the inventory we have on hand with respect to ft. Fysixteen you should assume that we've done more than one manufacturing run for FTC Fysixteen and we have hundreds of doses that are in fact available.

With respect to how this all came about.

Scott Washko: The infectious disease team at the University of Minnesota approached us and wanted to know if we'd be willing to supply FT-516 to support a UMN-sponsored study. Obviously, Minnesota has been a terrific partner of Fate Therapeutics for years, and so we were happy to agree to supply product to them. And if we can provide another tool in the arsenal to try and fight COVID-19, we're more than happy to do that. I think there is actually some strong rationale for using NK cells, obviously, to fight infectious diseases.

We didnt, we actually did not initiate the discussions here the infectious disease team at the University of Minnesota approached US wanted to know if we'd be willing to supply ft fysixteen to support a human sponsored study.

Obviously University, Minnesota has been a terrific partner of fate therapeutics for years, and so we were happy to agree to supply product to them.

And if it can provide another tool in the Arsenal to try and flight Cobot 19 were more than happy to do that I think there is actually some strong rationale potentially for using NK cells.

Scott Washko: I think one of the things that was appealing to us as we looked at the clinical design that the University of Minnesota folks, the infectious disease team at the University of Minnesota was putting forth is, again, continuing to reinforce this idea of being able to give patients multiple doses. So patients in the study are actually receiving multiple doses over a week. And it's actually a very interesting study from a clinical translation learnings perspective for us that may benefit us in our oncology programs because the intra-patient dose escalation starts at 90 million cells, goes to 300 million cells, goes to 900 million cells all in the course of a week. So there's administration on day one, day four, day seven, where you go very quickly from 90 to 100 million cells all the way to 900 million And so, from a clinical translation perspective, we'll be able to get an interesting read on what is a very high dose level in a relatively short period of time. Okay.

Obviously to fight infectious disease, I think one of the things that was appealing to us as we looked at the clinical design that the university of the folks the infectious disease team at the University of Minnesota was putting forth is again continuing to in reinforce this idea of being able to give patients multiple doses.

So patients in the study are actually receiving multiple doses over a week and it's actually very interesting study from a clinical translation learnings perspective for us that may benefit us actually on the on comp on our oncology programs because the intra patient dose.

Escalation starts at a 90 million cells goes to 300 million cells goes to 900 million cells. All in the course of a week. So Theres administration of day, one day for day, seven where you go very quickly from 92.

100 million cells, all the way to 900 million cells, and so we will be able to from a clinical translation perspective, we'll be able to get an interesting read on what is very high dose level in a relatively short period of time.

Okay. That's great. That's that's great contacts.

Scott Washko: Okay, that's great. That's a great contact.

Maybe just just a quick follow up to sort of the Janssen collaboration discussions that we've had I guess I just wanted to ask about your appetite specifically for maintaining ownership up your current clinical candidates I guess is there a scenario where they could be on the table too.

Scott Washko: And maybe just a quick follow-up to sort of the Janssen collaboration discussions that we've had. I guess I just wanted to ask about your appetite specifically for maintaining ownership of your current clinical candidates. I guess there is a scenario where they could be on the table too?

Yes, I mean, I'm not I'm not going to rule anything out I mean anything anything as a possibility I think we think that we both with respect to for instance, let's just pick 596 as well as 576.

Scott Washko: Um, yeah, I mean, I'm not, I'm not gonna rule anything out. I mean, anything, anything is a possibility. I think we think that, you know, we both with respect to, for instance, let's just pick 596, as well as 576.

Obviously, there if you think on Cdnineteen. If you think of BC M&A. These are targets specifically in the car T cell world that has been largely de risked.

And we do think we have a very disruptive approach to going after this cdnineteen as well as the bcm a market with a off the shelf paradigm.

Scott Washko: Obviously, if you think of CD19 and if you think of BCMA, these are targets in the CAR T cell world that have been largely de-risked. And we do think we have a very disruptive approach to going after the CD19 market as well as the BCMA market with an off-the-shelf paradigm. And so, you know, as we look at it today, and again, the world can change, but as we look at it today, we're more than prepared to go after and pursue those opportunities on our own.

And so as we look at it today and again the world can change, but as we look at today were more than prepared to go after.

And pursue those opportunities on our own.

Okay Thats fantastic. Thanks, so much.

Scott Washko: Okay, that's fantastic. Thanks so much.

Sure.

Your next question comes from Matthew the color.

Scott Washko: Sure. Your next question comes from Matthew Biegler. This is Calpedon for Matt, and thanks for taking our questions. First, for the Relapse Prevention Program for 596. Are the investigators planning to include patients who received prior CAR-T therapies, or is it just going to be prior chemotherapeutic patients?

Hi.

This is counted on for Matt and thanks for taking your questions.

First or the relapse prevention program for Fivenine six.

For the investigators planning to include patients who received prior car T therapy or is it just going to be prior chemo treated patients.

It's mostly it's most likely prior chemo treatment chemo only and so these these patients are for instance, they will have to have failed only one line of therapy.

Scott Washko: It's most likely prioto-chemo only, and so these patients are, for instance, they will have to have failed only one line of therapy, are eligible for autologous hematopoietic stem cell transplant and are at high risk for relapse. So they may have only, for instance, received one line of therapy, have qualified for transplant, but are deemed at high risk for relapse. And I think Wayne touched on it. The rate of relapse in these high-risk patients is high, and they do relapse quickly. And so, most likely, these patients will not have received CAR T-cell therapy.

Our eligible for autologous hematopoietic stem cell transplant and our at higher risk for relapse. So they may have only for instance received one line.

Have qualified for transplant, but are deemed at high risk for relapse and I think Wayne touched on it the rate of relapse in these high risk patients is high and they do relapse quickly.

And so most likely these patients will have will not have received car T cell therapy.

Okay.

Scott Washko: Okay, and then switching to 516 for solid tumors, specifically the combo with Velumab, are you planning to restrict enrollment based on patient PD-L1 expression levels?

And then switching to 516 for solid tumors.

Specifically the combo with a value add are you planning to restrict enrollment based on.

Patient PDL one expression levels.

We probably will not do that initially as part of a dose escalation and that in the first part of what I'm. Just I know, we're going to drive to demonstrate safety and tolerability of ft. Fysixteen in combination with the value Mab, but certainly yes getting getting.

Scott Washko: We probably will not do that initially as part of a dose escalation. In the first part of it, I know we're going to drive to demonstrate safety and tolerability of FT-516 in combination with Valumab, but certainly, yes, getting pretreatment biopsies is something that we're big believers in and investing a significant amount of our dollars in understanding these clinical studies in the clinical translation aspect of it. So all that kind of information is super helpful and informative. But in dose escalation, we're not necessarily going to restrict it.

Pretreatment biopsies as something that we're big believers in investing a significant amount of our dollars and understanding in these clinical studies in the clinical translation aspect of it. So all that kind of information is super helpful and informative, but in the dose escalation.

We're not necessarily going to restrict to that.

Okay, Alright, thank you very much.

Scott Washko: Okay, all right, thank you very much. Sure. Next up is Michael Smith.

Next is Michael Smith with Guggenheim.

Hey, guys. Thanks for taking my question.

Scott Washko: Hey guys, thanks for taking my questions. I had one on FT-819, the CAR-T program. Obviously it's earlier than some of the other programs that were talked about, but with the IND filing coming up here in the second quarter, I was just wondering how you think about things like optimizing or looking at the preconditioning or the persistence window in this early phase one study on one hand, and also maybe how you think about read-through from other allergenic CD19 CAR-T programs, such as, for example, the donor-derived programs where we see some data at ASCO coming up.

I had one on Ft 819, the car T program, obviously, it's currently.

Earlier than some of the other program through a talked about but with the I Andy filing coming up here in the second quarter. Alex just wondering how you think about job. Thank slide.

Optimizing the looking at the.

Snag or the persistence window and its early phase one study on one hand and also maybe how you think about.

Read through from other Allogenic Cdnineteen car T programs such as for example, the donor derived programs, where we see some data at ASCO coming up.

Yeah, I think it's I mean I'm super interested in seeing what comes out of for instance, the other donor derived car T cell programs I think it's going to be really fascinating.

Scott Washko: I think it's, I'm super interested in seeing what comes out of, for instance, the other donor-derived CAR T cell programs. I think it's going to be really fascinating to understand and get a first look at this, at the clinical data. I think, you know, I think there's certainly things that we can learn from those studies. I also think, you know, there's a, there's, there's enough diversity in the different programs where the total read-through, I think, is a bit difficult. I mean, I think you've heard me say in the past, and this comes from first-hand experience at Fate Therapeutics, you know, we don't believe donor-derived cell therapy is the same as IPS-derived cell therapy. There's a lot of heterogeneity still that exists between donors, and then there's a lot of heterogeneity that exists with respect to engineering.

To understand and get a first look at this at the clinical data I think I.

I think there's certainly things that we can learn from those studies I also think Theres a.

Theres theres enough diversity in the different programs, where a total read through I think is a bit difficult.

[music].

I mean, I think you've heard me say in the past in this comes from first hand experience at fate Therapeutics, We don't believe donor derived cell therapy is.

The same as IP us derived cell therapy.

There's a lot of heterogeneity still that exists between donors and then there's a lot of heterogeneity exists.

With respect to engineering, and so I think theres can be some very interesting learnings, but at the same time I don't I don't view it as a direct read through given the variances that do exist between for instance, donors uneven engineering strategies and approaches.

Scott Washko: And so I think there can be some very interesting learnings, but at the same time, I don't view it as a direct read-through, given the variances that do exist between, for instance, donors and even engineering strategies and approaches. So, I mean, I'd leave it at that, but we are really interested in getting a look at the first data from the other. I think one of the things we are a believer in, though, is that we like the idea of being able to give multiple doses. I think that is important because I think that has the potential to essentially, in some respects, drive persistence by creating the right PK PD window through a multi-dosing strategy.

So I think I'd leave it at that but we are really interested in getting a look at the first data from the other folks I think one of that and we are we are I think one of things we are believer in though is that.

We like the idea of being able to give multiple doses I think that is important being able to give multiple doses because I think that has the potential to essentially in some respects drive.

Persistence by creating the right PK PD window through multi dosing strategy.

And I guess philosophically and maybe that goes into that but how do you think about a window am a window off to assess than maybe two to avoid.

Scott Washko: And I guess philosophically, and maybe that goes into that, but how do you think about a window, a window of persistence, maybe to avoid host versus grasp rejection? I think there's a few different things that are being tested by competitors, you know, B2M knockout, more preconditioning, less preconditioning, longer preconditioning, or none at all.

Oh, Thats graft rejection and I think there's a few defend thing through our being tested by a competitor those will be two am knock on wood.

More preconditioning less preconditioning on the Preconditioning, all or none at all I guess, what philosophically what do you stand and how do you.

Scott Washko: I guess, philosophically, where do you stand? And how do you, you know, how will you approach? study. Sure.

How will you approach that Youre phase one study sure I think I think theres a lot to be learned.

Scott Washko: Sure. I think there's a lot to be learned. I think, you know, you...

I think you.

Community generally can jump to some conclusions that may not necessarily.

Scott Washko: The community generally can jump to conclusions that may not necessarily be true north, as an example. And I'm not suggesting NK cells are the same as T cells, another thing that we have to learn. But we went into the FT500 study with very light lymphoconditioning, keep that in mind, light lymphoconditioning, and we successfully demonstrated that you could give up to six doses over a 45 day period without seeing a B cell or T cell mediated immune rejection program emerge. So I think we have to look, look, and see what data emerges. Follow the data. I'm optimistic, quite honestly, given what I've seen from FT500 and the FT500 program, that you can, in fact, give multiple doses over a 45-day period without seeing significant B or T cell-mediated immune rejection programs.

Be true North as an example.

And I'm not suggesting NK cells are the same is T cells. Another thing that we have to learn but we went into the 5500 study.

With the very light lymphoma conditioning keep that in mind light lymphoma conditioning, and we successfully demonstrated that you could give up to six doses over a 45 day period without seeing a b cell or T cell mediated immune rejection program.

Emerge.

So I think we have to look.

Look and see what data emerges follow the data I'm optimistic quite honestly, given what I've seen from 5500 5500 program that you can in fact give multiple doses over 45 day period without seeing significant.

Bigger T cell mediated immune rejection programs and keep in mind, we gave a single lymphoma conditioning dose on day minus four day minus three and then treated patients for the next 45 days. So I think theres a lot to learn in the field I think as it relates to what type of window you ultimate.

Scott Washko: And keep in mind, we gave a single lymphoconditioning dose on day minus four and day minus three and then treated patients for the next 45 days. So I think there's a lot to learn in the field. I think as it relates to what type of window you ultimately need, I think there's data emerging. And there are different avenues to think about this.

We need.

I think there's I think theres data emerging.

And there is theres different different avenues to to think about this but I do go back to at least the autologous car T cell field, and let's let's use that as a baseline really having a profound anti tumor effect during the first 20 to 30 day.

Scott Washko: But I do go back to at least the autologous CAR T-cell field, and let's use that as a baseline. Really, having a profound anti-tumor effect during the first 20 to 30 days appears to be key. So that first 30-day window, I think, appears to be a really important window to drive sort of profound and durable anti-tumor activity. Now, interestingly enough, I'm not suggesting one dose is necessarily the best strategy to give during that 30-day period. I think you may want to come in with multiple doses during that 30-day period to drive the best responses.

Days appears to be key.

So that first 30 day window I think appears to be a really important window to drive sort of profound and durable antitumor activity.

Now interestingly enough I'm not suggesting one dose is necessarily the best strategy to give during that 30 day period. I think I think you may want to come in with multiple doses touring that 30 day period to drive the best responses.

Okay, great. Thanks for the from the thoughts Scott appreciate it.

Scott Washko: Okay, great. Thanks for the thoughts, Scott. I appreciate it.

The one thing I'd add on that like just just a follow up right. You can you can lymphoma deplete a patient and you can create a 30 day window.

Scott Washko: I mean, the one thing I'd add to that, like, just to follow up, right, you can lymphodeplete a patient, and you can create a 30 day window, and you could have a persisting cell. It doesn't mean that a cell has the same killing potential at day 14 as it did at day zero. And I think we're learning a lot about that, that cells that exist in the body, even for two weeks, three weeks, don't necessarily have the same killing potential as they did at day one. And so I think it goes well beyond just creating the right window for anti-tumor activity. You have to have potent cells, and I think you're going to have to get multiple doses of potent cells.

And you could have a persisting sell it doesn't mean that sell has the same killing potential at day 14 as it did it day zero and I think we're learning a lot about that.

Cells that exist in the body even for two weeks three weeks don't necessarily have the same killing potential as they did at day one.

And so I think it goes well beyond just creating the right window for anti tumor activity you have to have potent cells and I think you're going to have to get multiple doses of post cells.

And my last question comes from the line that Peter Lawson with Barclays.

Scott Washko: And our last question-on the line from Peter Lawson with Barker. Hi Scott. Thanks for taking the question. Just as you kind of think about the trials you've got started and started and there are a lot of options around the platform itself, what indication or construct do you think you could get to a pivotal trial fastest?

Hi, Scott Thanks for taking the questions just as we kind of think about the the trials you got started in starting and there's a lot of options around the platform itself.

What indication will construct do you think is get to.

Pivotal trial fastest.

I think I think actually 596 is a product candidate that.

Scott Washko: I think, you know, I think FT-596 is a product candidate that is positioned to quickly get into. Now, we have to show safety, and we have to show some sort of efficacy. But I think it is a candidate that we can look at.

Is positioned to quickly get into it now we have to show safety.

And we have to show sort of efficacy, but I think it is a product candidate that we can look at Cdnineteen is a de risked target. We do think we have a highly differentiated strategy in it being off the shelf in being able to potentially give multiple doses of potentially going after multiple tumor associated antigens. So I look at 50 596 am.

Scott Washko: CD19's a de-risked target. We do think we have a highly differentiated strategy in it being off the shelf, in being able to potentially give multiple doses, and potentially going after multiple tumor-associated antigens. So, I look at FT-596 as a, the target's de-risked, and I think we have a very differentiated product in that sense. With FT500, I think we're learning a lot. But I think ultimately, to go after solid tumors, I've talked about this on this call, you're gonna have to have multiple, probably multiple different engineered elements associated with that product to truly drive durable response. And so I think when we look at where we're going, we're assuming that as we go forward and take products deeper and deeper into registration studies, they're most likely multiplexed edited cell therapies.

As a is a the targets de risked and I think we have a very differentiated product in that setting.

With FC 500, I think with 5500, I think we're learning a lot, but I think ultimately.

To go after solid tumors I've talked about this on this call youre going to have to have a multiple probably multiple at different engineered elements associated with that product on to truly will drive durable responses and so I think I think when when we look at where we're going we're we're assuming that as we go forward and take product.

Deeper and deeper into registration studies, they are most likely multiplexed edited cell therapies.

Great. Thank you and then on.

Scott Washko: Great, thank you. And then on your comment just around, I mean, you're using these in an outpatient setting; what percentage of your trial sites are outside areas of excellence, the idea that you can move this outside those areas of excellence?

You'll comment just around I mean, you using isn't an outpatient setting what percentage of fuel trial side. So.

Outside areas of excellence.

And that you can move outside those centers of excellence.

Okay and then we initially started there and so I think our clinical I think our clinical trial sites are publicly available on clinical trials Dot Gov. I mean, not surprisingly we initially started at some of these centers of excellence, but some of the folks that were working with now our and getting activated remotely are outside of.

Scott Washko: We initially started there, and so I think our clinical trial sites are publicly available on clinicaltrials.gov. Not surprisingly, we initially started at some of these centers of excellence, but some of the folks that we're working with now and getting activated remotely are outside of what you would consider sort of the top centers of excellence, like Memorial Swan Kettering or an M.D. For instance, I'm not suggesting San Diego isn't a hotbed of cancer research, but we work with Moores Cancer Center at UCSD, which is right across the street. That's certainly more community-based than, for instance, MD Anderson.

You would consider sort of the top center of excellence.

Like the Memorial Sloan Kettering were an MD Anderson.

For instance, I'm I'm, not suggesting sort of San Diego is in a hotbed of cancer research, but we work with Morse cancer Center at you CST, which is right across the street.

It's more that's certainly more community based than for instance, MD Anderson.

Great. Thank you and then on the expansion in non small cell lung cancer.

Scott Washko: Great. Thank you. And then on the expansion of non-small cell line counts for the FT500, when can we see data? And then how should we think about, I guess, teasing out any effects that IL-2 or PD-L1 potentially adds?

To 500.

What can we see data and then.

How should we think about I guess teasing any effects that Io tool.

One potentially.

Ads.

I think what I think with respect to.

Scott Washko: Yeah, I think with respect to IL-2, we're certainly giving sub-therapeutic doses of IL-2. That's not uncommon.

Now ill to we're certainly giving sub therapeutic doses of aisle to thats not uncommon. If you think about what's what we've seen in other programs like til therapy til therapy get sub therapeutic doses of aisle too I think with respect to the PDL one contribution.

Scott Washko: If you think about what we've seen in other programs like Kill Therapy, Kill Therapy gives sub-therapeutic doses of IL-2. I think with respect to the PD-L1 contribution and the checkpoint inhibitor, I mean, these patients that have progressed or failed checkpoint inhibitor therapy, and we're giving the exact inhibitor that they just progressed or failed on. That said, I think there is, and people have demonstrated that gosh, you can resensitize a patient to a checkpoint inhibitor. But again, I think some of what we'll be able to tease out is what the response rates look like relative to checkpoint inhibitor therapy in patients that have already failed checkpoint inhibitor therapy.

The checkpoint inhibitor I mean, these patients that have progressed or failed checkpoint inhibitor therapy, and we're giving the exact inhibitor that they just progressed or failed on.

That said I think there is there is some people have been under demonstrated cashew can re sensitizer patient, giving a checkpoint inhibitor.

But again I think some of what will be able to tease out is what do the response rates look like relative to.

Point inhibitor alone in patients that have already failed checkpoint inhibitor therapy.

Great. Thanks, much thanks for taking the questions.

Scott Washko: Great. Thanks so much. Thanks for taking the questions. Sure. I am showing no further questions at this time. I would now like to turn the conference back to Mr. Scott Walsh.

Operator: Blaschko. Thank you. Thank you. Thank you, everyone, for participating in today's call. I look forward to talking to you in the near future. Be well.

Sure.

I'm showing no further questions at this time I would now like to turn the conference back to Mr. Scott.

Walk.

While Chicago. Thank you. Thank you.

Thank you everyone for participating in today's call look forward to talking to you in the near future.

Well.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating you may now disconnect.

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Operator: ???

Operator: BF-WATCH TV 2021