Q2 2020 CytomX Therapeutics Inc Earnings Call

To sum all participants on listen only mode.

This call may be recorded.

I would now introduce your host for today's conference call Christopher Keener, Vice President Investor Relations. Please go ahead.

Thank you Valerie good afternoon, and thanks for joining us.

Earlier today, we issued a press release that includes a summary of our recent progress and second quarter 2020 financial results.

This press release and a recording of this call can be found under the investors in news section of our web site at sites almost dotcom.

With me today are sites, almost president Chief Executive Officer in Chairman, Dr., Sean Mccarthy, and say Telmex, Chief Financial Officer, Carlos can't point.

During today's call, we will be making forward looking statements because forward looking statements relate to the future. They are subject to inherent uncertainties and risks, including the uncertainties surrounding the called the 19 pandemic that are difficult to predict and many of which are outside of our control.

Important risks and uncertainties are set forth in our most recent public filings with the FCC I'd actually see darko, including our form 10-Q filed today, we undertake no obligation to update any forward looking statements, whether as a result of new information future developments or otherwise.

Like to turn the call over to Sean.

Great. Thank you, Chris and good afternoon, everyone. Thanks for joining us.

Pleasure to be here to provide an update on our progress during the second quarter off 2020.

I'll begin today's call with a brief overview of our recent achievements, including our presentations at ASCO 2020 adds to the next extra lead clinical programs also comment briefly on our preclinical discovery progress and we'll then turn the call after Carlos to review, our second quarter financial results.

Well then open the call up for questions.

That's what time its we are a pioneering a noble classic therapeutic antibodies designs to target cats tissue, allowing for the development of an innovative pipeline of novel cancer therapies.

Over the past decade, we have so it's a strong scientific foundation probable technology, which has the potential to change the way, we think about actually what do you sort of Peters.

Well technology called the probably platform is designed to directs antibodies anti cancer activity towards tumor tissue and away from normal healthy tissue, allowing us to attack new Clos in the targets. The previously been considered inaccessible to conventional antibody approaches.

Oh for every strategy is to use our technology to make first thing Clos as he has the drugs for the potential treatment of a wide range of cancers by targeting these previously or druggable targets.

We're also utilizing our technology to discover and develop potentially best in class Immunotherapies.

We have four clinical stage programs advancing towards already in phase two clinical studies. These are CX to direct to die a property drug conjugate targeting cdseventy. One that we were advancing into phase two studies in multiple tumor types, including cutting back on non small cell lung cancers.

Yes, two 009, a property drug conjugate targeting CD won 66, so we are advancing into phase two studies breast cancer.

Sure so seven to a property therapeutic targeting PD L. One.

We were advancing in combination with see excuse or is there are nine in triple negative breast cancer.

And BMS My next six to four nine an assay CCN for property therapeutic currently in a randomized phase two study melanoma, which is being run by a partner Bristol Myers Squibb.

In parallel with building and advancing our broad clinical pipeline, we've formed many strong partnerships with leading biopharmaceutical companies, including BMS Amgen after the Atlas olefin advancing novel product candidate utilizing our technology.

We have integrated research and development capabilities and our ambition is to ultimately commercialize our products ourselves and with our partners as we build a long term sustainable values based organization.

I'd like to spend some time laying out the high level strategy for each of our four critical assets and had the data we presented at ASCO Twentytwenty as pointed the way to our phase two programs as we evaluate the full potential of each product candidate in further detail.

Let's begin with the excuse there are two nine a probity drug conjugate targeting cdseventy one.

She 71 is also known as be transferred receptor protein that is highly expressed on many cancer types, but.

Did you switch involvement and I had metabolism has been traditionally thought of as on drugs.

We know it backs the antibody drug conjugates targeting cdseventy, one or don't developable, She said lethal toxicity out low doses in animal models.

However, given the high potential of Cdseventy, one as a mobile assay cats. The target we have investigated whether a property technology could allow us to achieve therapeutic levels have been anti cdseventy, one drug called <unk> cancer patients potentially unlocking. This first in class approach across a range of different cancer types.

Oh phase one results presented at ASCO Twentytwenty show for the first time the by employing our technology Cdseventy. One can indeed be targets is successfully in patients with advanced cancers.

Okay. So escalation study achieved therapeutic levels of six to zero to nine and objectives confirmed single agent responses were observed in patients with squamous non small cell lung cancer and with hadn't next wave to sell squamous lung cancer.

The principal dose limiting toxicity seen in this phase one study was and media, which was managed with red blood cell transfusions.

These promising phase one results for six to there are two lines are particularly important because targeting cdseventy. One is likely the most rigorous test we have conducted to date to assess our property technology and these results. We believe underscore the broad potential of our platform.

These phase one data also resulted insights I make 30 or 40 billion dollar milestone payment from Abbvie apart for this program, which we received in the second quarter.

Let's say mix continues to lead clinical developments in this global co development and commercialization of lives.

We expect to initiate phase two expansion cohorts subsea excuse or Tonight, the dose of three milligrams per kilogram every three weeks.

In head and neck squamous cell carcinoma.

Wamus non small cell lung cancer squamous itself, but she'll carcinoma and DLP Seattle in the second half for 2020 with potential for the first data read outs.

Late Twentytwenty one.

Turning now to see it to 009, a wholly owned drug candidate targeting the previously Undruggable targets. He wants 66.

She was 66 is widely expressed across multiple tumor types and we believe had broad potential has a novel anti cancer target.

Right, but like Cdseventy. One city was 66 is present on many normal tissues ruling it out with a target for conventional therapeutic antibody approaches.

To unlock the potential in this novel pathway, we have designed CX twos or nine let's see was 66 targeting pro body conjugates into the well characterized cytotoxic painted b M.

[noise] submitted for experience with see excuse or Tonight, we just discussed.

Our phase one dose escalation study would see X two 009 in patients with selected advanced solid tumors.

She used therapeutic exposure is off the drug candidate.

We observed evidence of single agent anticancer activity in several tumor types, including breast cancer and ovarian cancer.

Six two thirds or night was generally well tolerated the principal dose limiting toxicities were ocular anticipated and well documented secular of DM for cultures and that we intend to manage with ocular pressure Lexus and ongoing studies.

[noise] with phase one that complete for this asset our program strategy is presently focused on breast cancer.

Oh, no CD 160 cents expression is high in greater than 80% of hormone receptor positive hertwo negative breast cancer patients.

And then approximately 50% to patients with triple negative breast cancer.

You know phase one study we observed durable clinical activity in both of these breast cancer populations. Despite these patients being very heavily pre treated.

Significant unmet medical need remains in breast cancer and accordingly, we previously announced initiation of a phase two expansion study subsea two 009 in hormone receptor positive hurts your legacy breast cancer.

We didn't like support the study at March Twentytwenty due to the impact of the code that Patrick However, our team is usually intervening period, resulting from the pandemic to further refine the study with a focus on patient enrollment criteria, including prior treatment regimens.

This revised trial will continue to evaluate Cfptwos <unk> monotherapy 70 milligrams per kilogram administered every three weeks and we enroll at least 40 patients.

We expect to Reinitiate the study during the second hospice 2020.

We're also preparing to initiate phase two expansion studies of six to <unk> in triple negative breast cancer, both as monotherapy and in combination with a whole yard anti PDL 146 or seven too.

We have previously reported single agent activity for Cxo seven two in triple negative breast cancer.

Represented our preclinical data to provide experimental rationale for combination treatment of CHF, two thirds or in line with PD inhibition consistent with the well established benefits that's good biting chemotherapy and checkpoint inhibition.

We're excited it's also got this work underway in the second half of this year.

These phase two studies offs tier two thirds or nine in hormone receptor positive a triple negative breast cancers are important next steps in our further evaluation of the potential of this novel first in class drug candidate.

Working towards initial data by the had a 2021.

Moving on now to our PD one inhibitors the access up to in further detail.

Updated data from our phase one to try to see Ekso seven two from multiple expansion cohorts.

Did you to show durable anti tumor activity.

In patients with higher sensitive tumors.

Just triple negative breast cancer annual squamous cell carcinoma, cutaneous squamous cell carcinoma, and she was with high mutational burden. The states. It was presented at ASCO 2020.

I'd like to spend a few minutes here highlighting the hi, QB mutational burden cohort for six or seven too, which is illustrative of the unique and potentially differentiated clinical profile of this asset.

[noise] 14 patients with various it boss tumor types with high TMB were treated with six or seven to 10 Bixby kick.

Okay and efficacy of valuable patients three confirmed partial responses on one confirmed when complete responses were observed the partial responses were in colorectal cutaneous squamous cell carcinoma.

Neuroendocrine carcinoma, and the complete responses in patients with annual squamous cell carcinoma.

So 70 was well tolerated with only 2% grade three or higher immune related adverse events.

These data are particularly of note. If you if merck's approval in mid June this year Keytruda in solid tumors with high TMB.

As we now conclude off first clinical explorations of Cxo 70.

Which is the first protein therapeutics be evaluated in humans, we're very encouraged that our platform is functioning as designed and these findings provide rationale for differentiation of six or seven to from other P.D. inhibitors and support combination strategies, we see excuse or night and other anticancer agents.

Turning now to another exciting application of our technology and cancer immunotherapy and our work with our partner Bristol Myers Squibb, who presented data during the second quarter for to actually see telling for priority programs.

My next six to four nine and BMS 96 to eight eight which I will refer to as Vms to four night Vms to eight eight respectively.

[noise] at ASCO BMS presented the first clinical data for BMS to four nine approached 40 version of the assay CCRC for antibody if a dream about.

This is a novel therapeutic strategy to enhance see sealy for exposure in the tumor microenvironment, well potentially sparing systemic toxicity.

The trial evaluating BMS 2.9, as monotherapy or in combination with the anti PD one antibody they've all of that in patients with advanced cancers that doses ranging from 240 milligrams to 2400 milligrams of the property.

Wish for reference is approximately three to 30 makes the kid.

It's a little map is typically used a clinically at doses of whats the three big speaking.

[noise] safety data from the Phase one trial showed BMS two for life was generally well tolerated as monotherapy.

Pending combination with Nivo.

Types of treatment related adverse events were consistent with those seen with the parent molecule if illegal.

The is this a grade three or the bugs adverse events were supportive of the property mechanism of action.

Based on these phase one findings BMS is initiated a randomized cohorts expansion evaluating the tolerability and activity of BMS to four nine in combination with Nivo.

This is nivo with or without Ipilimumab in metastatic melanoma the.

The advancement BMS to four nine into this study triggered a milestone payment of $10 billion from BMS sites I missed it was received in the second quarter.

This is an important study that has the potential to provide additional validation of this novel product candidate.

[noise] staying with CTO like for for a few moments also in Q2 at a CR.

BMS presented preclinical data for B S to four nine I'd also BMS to eight eight which is a pro body of a known few calls the latest version of it so they were bad.

M.S. to four nine I'd be remiss to a demonstrated equivalent intra tumoral pharmacodynamic activity and comparable anti tumor activity relative to that parental antibodies.

These data also showed that the print body versions are significantly safer.

The each underlying antibody.

Constricting highest non severely toxic doses in animal models that were five fold and threefold improved respectively.

These data to support the strategy of using our proprietary technology to expand therapeutic index or do you feel like for therapy and are strongly consistent with the clinical experience to date. The BMS is reported with BMS 2.9.

So don't be cultivated prairie body BMS to eight A. is also in the clinic in a phase one dose escalation thing.

Before I turn it was a cause for you all our financials I'd like to provide brief update so three earlier stage programs as I said, they said our emerging as a potential second waibel product candidates in our pipeline.

Let me begin with CX night or for our T cell by specific problem, he talked to Egypt far and Cdthree partnered with Amgen.

We believe the application of our priority technology has potential to enable solid tumor targeting this modality.

Such targeting with a modest T cell bi specifics has been very challenging for the field, she said narrow or non existant therapeutic windows.

We continue to advance is candidate towards I'd and they've been studies.

Expects to file in late 2021.

Turning to see X 2043.

Our wholly owned cabin targeting property drug conjugate.

Yes, two three or four three was developed to utilizing sites have its probably technology at Immunogens Immunogens drug conjugate technology and arose from my previous strategic collaboration.

We continue to it bounces candidate towards idea enabling studies.

Lastly, as part of the strategic collaboration with us that lets them in asked in the first quarter for which we received an $80 million upfront payments. We have now launched discovery activities surrounding the development and ultimate commercialization of novel piece I think aging by specific antibodies.

In most form.

This is our second to lives in this exciting area of research we have high hopes for this probably formats.

With that let me hand, the call labor to Carlos to review our financial update.

Thank you Sean.

I would now like to review the financial highlights from the second quarter ending June 2019.

Revenue for the quarter was 16.6 $9 compared to 9 million and the corresponding period in 2019.

The increase is primarily due to a higher percentage of project completion of CX nine <unk> for our Amgen EG Fr product candidate and also the recognition of revenue related to the $80 million upfront payment received under the Astelit agreement that we entered into in March 2020.

Research and development expenses were $24 million for the quarter compared to $30.8 million and a corresponding period in 2019. The decrease was largely attributed to onetime licensing fee paid in 2019 and a decrease in clinical trial related activities in 2020.

We ended the quarter with cash cash equivalents and investments totaling $346 million compared to 296 million as of December 31st 2019.

We expect our strong balance sheet to allow us to me projected operating requirements into the second half from 2022, assuming no new collaborations or financing with that I'll turn the call back to Sean.

Great. Thanks Carlos.

So let me wrap things up here and then we'll go to questions.

In summary, slide 10 Bucks made real progress across our clinical and preclinical programs during the second quarter, because we put through at Boston technology partnerships and lead drug candidates to several important inflection points.

We have continued to show leadership in defining new therapeutic antibody modalities with potential to address significant unmet medical needs in the treatment of cancer.

And that remains as important as ever despite the unprecedented challenges the posed by the cobot 19 pandemic.

We've never look to previously Undruggable target into play in the oncology field without platform CD 166, and see the 71.

Both of which we believe our broad potential in multiple cancer types will be living a lot more about these product candidates from our phase two studies that we expect to start to read that in late 2021.

We further extending our undruggable target strategy with the advancement of our bi specific program targeting cdthree and each fr.

And with the drug conjugate targeting ATCA. These preclinical programs, that's taking great shape, because our next nineties.

We've also continued with our cancer immunotherapy strategy leveraging clinically validated targets.

The clinical data for our wholly owned assay PDL one for a 46 or seven two has continued to mature affording us unique opportunities to advance innovates a combination therapies.

Starting with here, So 70, plus CX users are nights in triple negative breast cancer.

Collaborative work with BMS on CCN for has also provided important important proof points truck platform, both clinical and preclinical and we're delighted to see BMS 249, continuing good box and the randomized phase two melanoma study in combination with Niva.

[noise] approved partnership strategy has also continued to deliver with $130 million cash proceeds so far this year, including the initiation of a major new alliance with the status and the progression of many additional preclinical programs across our collaborations adding to the strength in depth of our pipeline.

We continue to enjoy robust cash position I remain highly focused on making the biggest difference we can for cancer patients as we continue to build our company.

Regarding cobot 19 sites Ebix has continued to execute very well despite the uncertainties and challenges presented by the pandemic.

All of US at the company Hope that you and your families are well and keeping safe. During this time and I would like to close by thanking our employees our patients our investigators clinical trial stuff and everyone involved in helping us continue to drive forward with our mission.

The big New medicines for the treatment of major unmet medical needs in oncology.

With that I'll hand, the call back to Chris and we'll open up for questions.

Yes.

Thank you Sean salary. Please open the QNX session.

Thank you, ladies and gentlemen can I ask a question. Please press Star then one when you touched on telephone.

Again, if you like after question. Please press Star then one.

[noise] I'm on the for our first question.

Our first question comes and Peter Lawson of Barclays. Your line is open.

Hey, guys. This is what lead on for Peter Thanks for taking my question savvy. Initially on the extension study for CX two years or nine.

Sure like if you could give us a little bit more color and details on the revised patient enrollment criteria for the study and also based on your discussions with you.

Operator: I'm going to try to listen to all of them. As a reminder, this call may be recorded. I would now like to introduce your host for today's conference call, Christopher Keenan, Vice President of Investor Relations. Chris, please go ahead.

Hey, what does the bar need to hit.

What would you consider positive results.

And in both Hertwo negative breast cancer as well as triple negative. Thank you.

Christopher Keenan: Thank you, Valerie. Good afternoon, and thank you for joining us. Earlier today, we issued a press release that includes a summary of our recent progress and second quarter 2020 financial results. This press release and a recording of this call can be found under the Investors in News section of our website at CytomX.com. With me today are CytomX President, Chief Executive Officer, and Chairman, Dr. Sean McCarthy, and CytomX Chief Financial Officer, Carlos Campoy.

Yes, great. Thanks for the questions. So regarding a patient enrollment the kinds of things that we're looking at obviously, our it given that the the phase one data for 2009.

Was generated in a very heavily pre treated patient population with a median number of prior treatments of seven or eight depending upon whether it was CNBC or hormone receptor positive. Obviously, we're looking to enroll a substantially less heavily pre treated patient population in the study. So we've been fight choosing that a in the recent bugs.

Christopher Keenan: During today's call, we will be making forward-looking statements. Because forward-looking statements relate to the future, they are subject to inherent uncertainties and risks, including the uncertainty surrounding the COVID-19 pandemic, which are difficult to predict and many of which are outside of our control. Important risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov, including our Form 10-Q filed today. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future developments, or otherwise. I would like to turn the call over to Sean.

Also given the evolution of the landscape I'm getting a little bit more thought to prior treatment regimens that are that are alive in the study.

In because of the patient population. So those are the kinds of things that we're doing in this intervening period.

Regarding the bar for a activity.

Still want to upsize. This is still a relatively early exploration of 2009 in breast cancer. It is a rapidly evolving field both in whole members that positive a triple negative.

Sean A. McCarthy: Great. Thank you, Chris.

Sean A. McCarthy: And good afternoon, everyone. Thanks for joining us. It's a pleasure to be here to provide an update on our progress during the second quarter of 2020. I'll begin today's call with a brief overview of our recent achievements, including our presentations at ASCO 2020 and the next steps for our lead clinical programs. I'll also comment briefly on our preclinical discovery progress, and we'll then turn the call over to Carlos to review our second quarter financial results. We'll then open the call up for questions.

We haven't yet hot formal discussions with FDA on these types of matters, but the.

In Triple negative courseware, very well aware of the approval now the.

Sacituzumab.

And got to see that we've seen would that molecule.

In hormone receptor positive, whereas Susan I was also active so we're mindful of the need to be competitive.

Sean A. McCarthy: At CytomX, we are pioneering a novel class of therapeutic antibodies designed to target cancer tissue, allowing for the development of an innovative pipeline of novel cancer therapies. Over the past decade, we have built a strong scientific foundation for our mobile technology, which has the potential to change the way we think about antibody therapeutics. Our technology, called the ProBody Platform, is designed to direct an antibody's anti-cancer activity towards tumor tissue and away from normal, healthy tissue, allowing us to attack new classes of targets that have previously been considered inaccessible to conventional antibody approaches.

In this evolving.

Landscape.

Okay.

Great. Thank you and then maybe just a question on investing for nine do you have any idea when we can see D or the next data read out from for that study.

Unfortunately, we thought was at this stage they are actively enrolling patients.

I have been.

We can't speak to that timelines, unfortunately or to you.

The impact that says cobot, maybe having on their enrollment. So we're just gonna have to wait and see.

How that unfolds.

Sean A. McCarthy: Our primary strategy is to use our technology to make first-in-class anti-cancer drugs for the potential treatment of a wide range of cancers by targeting these previously undruggable targets. We're also utilizing our technology to discover and develop potentially best-in-class immunotherapies. We have four clinical stage programs advancing towards, or already in, Phase II clinical studies.

Great. Thanks for taking the questions.

Youre welcome.

Thank you. Our next question comes from Eastern Europe, I believe in home Securities. Your line is open.

The first one for me is a little clarity on the Cxos 72.

Combination with Cxtwo nine if that.

What you said was that you plan to sort of initiate a study there in the second half of this year and then just a quick question on your Stella's by specific <unk> collaboration you know, obviously, but how about the logic malignancies, where we've seen sort of the most success, but it's also kind of more you know more crowded I wondered if you could talk about.

Sean A. McCarthy: These are CX2029, a pro-body drug conjugate targeting CD71, that we are advancing into Phase II studies in multiple tumor types, including head and back and non-small cell lung cancers; and CX2009, a pro-body drug conjugate targeting CD166 that we are advancing into Phase 2 studies in breast cancer. CX072, a pro-body therapeutic targeting PD-L1 that we're advancing in combination with CX2009 in triple negative breast cancer, and BMS 986249, an anti-CTLA-4 pro-body therapeutic currently in a randomized phase 2 study in melanoma, which is being run by our partner, Bristol-Myers Squibb. In parallel with building and advancing our broad clinical pipeline, we have formed We have integrated research and development capabilities, and our ambition is to ultimately commercialize our products ourselves and with our partners as we build a long-term sustainable values-based organization.

Little bit about maybe where you ended stimulus plan to sort of concentrate or focus sort of your your energy. If you will in terms of sort of the bi specific landscape and where you may find indications I guess that are more appropriate for the technology. Thanks.

Yes, great high as or I think so the question. So yes, we are.

Actively gearing up to start an expansion cohort expansion cohorts of.

2009 in Triple negative both as a monotherapy and in combination with those seven to I won't see reiterate that we have seen single agent activity for both both properties that was seven two and 2009 in triple negative. So we think this is an exciting experiment to do.

Either with the potential for competitive differentiation further down the road.

So that study waiting to get up and running second half.

Sean A. McCarthy: I'd like to spend some time laying out the high-level strategy for each of our four clinical assets and how the data we presented at ASCO 2020 has pointed the way to our Phase 2 programs as we evaluate the full potential of each product candidate in further detail. Let's begin with CX2029, a pro-body drug conjugate targeting CD71. CD71 is also known as the transferrin receptor, a protein that is highly expressed in many cancer types, but due to its involvement in iron metabolism, it has traditionally been thought of as undruggable. We know, in fact, that antibody drug conjugates targeting CD71 are not developable due to lethal toxicity at low doses in animal models. However, given the high potential of CD71 as a novel anti-cancer target, we have investigated whether our ProBody technology can allow us to achieve therapeutic levels of an anti-CD71 drug conjugate in cancer patients, potentially unlocking this first-in-class approach across a range of different cancer types.

With regard to status, we haven't guided the specific focus of the ER. The programs there in terms of human sites I would just say.

Broadly speaking that our strategy and using our pro body masking technology.

Sean A. McCarthy: Our Phase 1 results presented at ASCO 2020 show, for the first time, that by employing our technology, CD71 can indeed be targeted successfully in patients with advanced cancers. Our dose escalation study achieved therapeutic levels of CX2029, and objective confirmed single agent responses were observed in patients with squamous non-small cell lung cancer and with head and neck squamous cell cancer. The principal dose-limiting toxicity seen in this Phase 1 study was anemia, which was managed with red blood cell transfusion. These promising phase 1 results for CX2029 are particularly important because targeting CD721 is likely the most rigorous test we have conducted to date to assess our pro-body technology. And these results, we believe, underscore the broad potential of our platform.

Cdthree bi specifics is.

Sean A. McCarthy: These Phase 1 data also resulted in CytomX earning a $40 million milestone payment from AbbVie, our partner for this program, which we received in the second quarter. CytomX continues to lead clinical development in this global co-development and commercialization alliance. We expect to initiate phase two expansion cohorts of CX2029 at the dose of three milligrams per kilogram every three weeks in head and neck squamous cell carcinoma, squamous non-small cell lung cancer, squamous esophageal carcinoma, and DLBCL in the second half of 2020, with potential for the first data readout in late 2021. Turning now to CX2009, a wholly owned drug candidate targeting the previously undruggable target CD166. CD166 is widely expressed across multiple tumor types and, we believe, has broad potential as a novel anti-cancer target. However, like CD71, CD166 is present in many normal tissues, ruling it out as a target for conventional therapeutic antibody approaches.

From the slight toby's points of view is largely directed a solid tumors, where we see the need for.

Sean A. McCarthy: To unlock the potential of this novel pathway, we have designed CX2009, a CD166 targeting ProBody conjugated to the well-characterized cytotoxic payload, BM4. Similar to our experience with CX2029 that we just discussed, our phase one dose escalation study with CX2009 in patients with selected advanced solid tumors achieved therapeutic exposures of the drug candidate. And we observed evidence of single-agent anti-cancer activity in several tumor types, including breast cancer and ovarian. CX2009 was generally well tolerated. The principal dose-limiting toxicities were ocular, anticipated and well-documented sequelae of DM4 conjugates that we intend to manage with ocular prophylaxis in ongoing study. With phase one now complete for this asset, our program strategy is presently focused on breast care. Of note, CD166 expression is high in greater than 80% of hormone-receptive positive HER2-negative breast cancer patients and then approximately 50% of patients with triple negative.

The substantial improvements because this has been a very tough.

Area to break into for reasons, a very very narrow and compressed therapeutic window.

With solid tumor targets. So that's a broadly speaking we've developed the technology to address all the tumors certainly could have application in hematologic I can't speak specifically for stylists.

Yes.

Great and congrats on the progress.

Great. Thank you very much.

Thank you next question comes from parents plan of Goldman Sachs. Your line is okay.

Sean A. McCarthy: In our Phase 1 study, we observed durable clinical activity in both of these breast cancer populations, despite these patients being very heavily pretreated. Significant unmet medical need remains in breast cancer, and, accordingly, we previously announced the initiation of a Phase II expansion study of CX2009 in hormone receptor-positive HER2-negative breast cancer. We did elect to pause this study in March 2020 due to the impact of the COVID pandemic. However, our team has used the intervening period resulting from the pandemic to further refine the study with a focus on patient enrollment criteria, including prior treatment regimens. This revised trial will continue to evaluate CX2009 monotherapy at 7mg per kg, administered every 3 weeks, and we aim to enroll at least 40 patients. We expect to restart the study during the second half of 2020.

Hi, Thanks for taking the question with just wondering on choose your Twonine regarding the phase two program I know you ran through it sounds like three different tumor types you're focused on there can you maybe just give some insight in terms of how many patients you think would be eligible if you look at U.S. Yoo five and Japan for treatment here with.

Two zero to nine just trying to kind of think about the potential market opportunity. Thank you.

Yeah, Hi Tech has great question.

So let me just run through the for expansions are again.

Clarity so.

Squamous hadn't back.

Squamous non small cell lung.

Squamous itself the deal and then Dl Bcl.

The first two indications.

Oh, we.

Demonstrated.

Confirmed.

Marshall responses in phase one dose escalation.

So where does the Soviet deal we've shown preclinical activity.

And senior crop models.

He deal Bcl strong preclinical activity in that indication that's the first team its electric indication.

That's one that has arisen through our discussions with our Collaborates I'd be.

They have a strong interest in hematologic malignancies as you know.

In terms of yeah penetration off the patient population in the market size in light of therapy.

Sean A. McCarthy: We're also preparing to initiate Phase 2 expansion studies of CX2009 in triple negative breast cancer, both as monotherapy and in combination with our wholly owned anti-PD-L1 pro-body, CX072. We've previously reported single-agent activity for CX072 in triple-negative breast cancer, and have also presented our preclinical data that provide experimental rationale for combination treatment of CX2009 with PD inhibition consistent with the well- We're excited to get this work underway in the second half of this year.

It's really too early to tell at this stage.

We are.

Sean A. McCarthy: These Phase II studies of CX2009 in hormone receptor-positive and triple-negative breast cancers are important next steps in our further evaluation of the potential of this novel first-in-class drug candidate, and we are working towards initial data by the end of 2021. Moving on now to our PD-L1 inhibitors, the X072, in further detail. Updated data from our Phase 1-2 trial of CX072 from multiple expansion cohorts continue to show durable anti-tumor activity in patients with I.O.S. sensitive tumors, triple negative breast cancer, anal squamous cell carcinoma, cutaneous squamous cell carcinoma, and tumors with high mutational burden. This data was presented at ASCO 2020. I'd like to spend a few moments here highlighting the High Tumor Mutational Burden Cohort for CS072, which is illustrative of the unique and potentially differentiating

Optimistic based on the phase one data.

Of course that we have we have a a very unique.

Active single agent against a.

Previously Undruggable target that has shown in some of the case studies that we presented previously at ASCO, some pretty profound tumor regressions in patients with very late stage very heavy tumor burden.

The.

Therapeutic window is clearly there are three makes the cake.

We need to do more work to work to establish.

Hi, White that therapeutic window is which will dictate ultimately how far forward in lines of therapy, we could bring this exciting drug candidate so terrorists or we just have a lot more work to do there, but we're excited we think this program is going to have brought the central.

Okay. Thanks, so much.

Thank you I next question comes back in and out of Jefferies. Your line is open.

Thank you.

Ladies.

Hi, guys there thanks.

Thanks for taking my questions.

So on CTX, two zero Tonight for the dose expansion cohort have you made any adjustments.

In this cohort that could lead to lower grade three or higher a knee views from neutropenia is that you observed that dose escalation apart.

Yeah hybrid well I would just say that where a couple of a couple of things are the hematologic site with which these are two nights.

He.

As we discussed previously these are.

Anticipated a adverse events with this payload to some extent with this target.

We are doing more work to understand the etiology of the anemia or over time, but in terms of steps that we're taking a they will include a treating patients with.

Red blood cell generating growth factors like eco derivatives.

And that's where do we can say right now but.

I wanted just to remind everybody that the.

Phase one experience demonstrated that we were able to manage the anemia with red blood cell transfusions. A this is something that oncologists Aubrey.

Used to doing given many decades of experience with chemotherapy.

And where.

Continuing to get to handle all.

On the overall therapeutic window will continue Scott has all the therapeutic window. If this target and this Asia as time goes off.

And on the dose expansion are you enrolling for patients with high 60 71 expression.

No we're not.

Let me let me ask the question this way we don't.

Leave we have enough data yet.

By the preclinical or clinical she draw any conclusions regarding the [laughter].

[music].

Target level versus response.

Sean A. McCarthy: 14 patients with various advanced tumor types with high TMB were treated with CX072 at 10 weeks per kick, of which 10 Advocacy Evaluable Patients. 3 confirmed partial responses and 1 complete response were observed. The partial responses were in colorectal cutaneous squamous cell carcinoma and neuroendocrine carcinoma, and the complete response was in a patient with anal squamous cell carcinoma. CSO70 was well tolerated, with only 2% of grade 3 or higher immune-related adverse events.

One of the things to consider is the Cdseventy one it's such an interesting target because it's cycles. So rapidly off the cell surface and that back you know, it's isn't unusual target where expression level may or may not ultimately correlate with response and so we're not we're not doing we're not.

Sean A. McCarthy: These data are...

Making too many assumptions about this at this stage so selection strategies will be develop over time.

Great. Thanks for taking my question.

Youre welcome.

Thank you. Our next question comes from Marigold theme.

Mizuho Your line is open.

Great. Thanks for taking my question.

[laughter] question.

Ah, Yes, seven Q and.

Environment for couple of negative cancers.

Breast cancer therapy, and inefficient decides it that you are not the best indication given the competitive landscape is there a set of plan b of what you might.

Well what comment what other what other trials you might look at that's personal and second of all I don't have a question on.

Yeah, She's doing Tonight, and good decision to focus on a.

Sean A. McCarthy: Particularly of note, in view of Merck's approval in mid-June this year of Keytruda in solid tumors with high TMB. As we now conclude our first clinical explorations of CX072, which is the first pro-body therapeutic to be evaluated in humans, we're very encouraged that our platform is functioning as designed. These findings provide rationale for differentiation of CX072 from other PD inhibitors and support combination strategies with CX2009 and other anti-cancer agents.

When it came as rather non Twain us and I say something in the biology that we should be lab.

Yeah, Hi, Mike Great questions.

So with regards to see it so seven to you know.

A lot of this is about follows the data.

And as our data has continued to in marriage and mature over time for six or seven see monotherapy and 2009.

The concept of combining the two these agents, which as I mentioned earlier, both have single agent activity at CNBC combining them in that indication.

Sean A. McCarthy: Turning now to another exciting application of our technology in cancer immunotherapy and our work with our partner Bristol Myers Squibb, who presented data during the second quarter for two anti-CTLA-4 probody programs, BMS-986249 and BMS-986288, which I will refer to as BMS-249 and BMS-288, respectively. At ASCO, Bristol presented the first clinical data for BMS-249, a pro-body version This is a novel therapeutic strategy to enhance CTLA-4 exposure in the tumor microenvironment while potentially sparing systemic toxicity. The trial evaluated BMS-249 as monotherapy or in combination with the anti-PD-1 antibody nivolumab in patients with advanced cancers at doses ranging from 240 mg to 2,400 mg of the provolone, which, for reference, is approximately 3 to 30 mg per kg.

We think makes a lot of assets.

In the context of the current capacity landscape on the assumption that the activity of the two together or has the potential to do something interesting really interesting.

So we'll see political run this expansion and we'll see what what we got.

Right. The landscape is evolving it's not a huge patient population.

Were really interested to see what this competition could do.

Yeah, you see.

The.

[music].

Question, its squamous tumors and actually I'm, sorry, let me answer the second part of your question on or 70, which which really relates to the program sporadic strategy of role which is what they said we continue to follow the data or where yeah, we've evolved to where the combination strategy as you know rather than driving the monotherapy took.

Registration, that's where the competitive landscape. We see is just to wait too crowded thrust to at this point without a partner to invest in driving the monotherapies registration at least at this stage we.

Sean A. McCarthy: Ipilimumab is typically used clinically at doses of one to three mixed. Safety data from the Phase 1 trial showed that BMS-249 was generally well-tolerated as monotherapy and in combination with Nevo. The types of treatment-related adverse events were consistent with those seen with the parent molecule, ipilimumab, and the incidence of grade 3 and above adverse events was supportive of the pro-body mechanism of action. Based on these Phase I findings, BMS has initiated a randomized cohort expansion, evaluating the tolerability and activity of BMS-249 in combination with NEBO versus Nevo with or without ipilimuma The advancement of BMS 249 into this study triggered a milestone payment of $10 million from BMS to CytomX, which was received in the second quarter.

To remain interested in potentially finding a partner for this asset oversight and that could help inform future strategy as well.

[music].

Regarding wamus tumors and see what's your nine again follow the data.

Yeah. The clinical observations are really interesting the kind of thing you keep your eyes opened for when you run phase one studies.

We are intrigued by the activity that we've seen in squamous hadn't <unk> and squamous lung.

Why might not be and it isn't it you know is it a real signal in terms of that relative to other tumor types. You know that's why we need to broaden the expansion.

Sean A. McCarthy: This is an important study that has the potential to provide additional validation of this novel product candidate. Staying with CTLA-4 for a few moments, also in Q2 at AACR. BMS presented preclinical data for BMS-249 and also BMS-288, which is a probody of a non-pukosylated version of ipilimumab. BMS-249 and BMS-288 demonstrated equivalent intratumoral pharmacodynamic activity and comparable antitumor activity relative to their parental antibody. These data also showed that the ProBody versions are significantly safer than each underlying antibody, demonstrating highest non-severely toxic doses in animal models that were five-fold and three-fold improved, respectively.

Why might it be the case.

Two predicts a target, but as we just discussed we have very early understanding of target for instance, this fall the cdseventy woman to learn more there could it relates to the microenvironment possible.

So we just need to do more work, but we think it's an intriguing clinical hypothesis and sometimes phase one studies give you these great opportunities to all of the data into things too and that's exactly what we're doing so we'll be live anymore.

Okay, and if I can just south of Islam, Ryan and I know, obviously personal is in charge of I'm. Just wondering but you can you just remind us what is maybe the next financial milestone for that program.

So for 2.9 for the for the it'd be probably body it would likely be the initiation of a registrational study, but I'd have to go back and checked that.

Sean A. McCarthy: These data support the strategy of using our pro-body technology to expand the therapeutic index to CTLA-4 therapy and are strongly consistent with the clinical experience to date that BMS has reported with BMS-249. The non-fucosylated pro-body BMS-288 is also in the clinic in a Phase 1 dose escalation. Before I turn over to Carlos for a review of our financials, I'd like to provide brief updates on three earlier stage programs at CytomX that are emerging as a potential second wave of product candidates in our pipeline. Let me begin with CX904, our T-cell bispecific probody targeting EGFR and CD3, which is partnered with Amgen. We believe the application of our ProBody technology has the potential to enable solid tumor targeting of this modality. Such targeting with unmasked T cell biospecifics has been very challenging for the field due to narrow or non-existent therapeutic windows.

Okay. Thank you.

Thank you. Our next question comes from only about though of Citi. Your line is okay.

Great. Thanks for taking my question.

So just wanted to probably before the on the costly to a full body of knowledge. If I'm. So can you. Please help us understand.

What she constellation actually.

What difference does that make a to the real but do you antibody and if I'm not mistaken seems like if these non see costly too much and was also tested into oneq. So is there any I didn't think we have learned from from that.

Compound pitch, which could be used Uh huh.

Yeah, Hi move it thanks for the question so the concepts.

And this this is articulated in the.

Hey, CR poster that CMS presented a few months back the concept is that.

Sean A. McCarthy: We continue to advance this candidate towards IND Enabling Studies and expect to file in late 2021, turning to CX2043, our wholly owned Epcan targeting pro-body drug conjugate. CX2043 was developed utilizing CytomX ProBody technology and Immunogen's drug conjugate technology and arose from our previous strategic collaboration. Lastly, as part of the strategic collaboration with Astellas that we announced in the first quarter, for which we received an $80 million upfront payment, we have now launched discovery activities surrounding the development and ultimate commercialization of novel T-cell-engaging bi-specific antibodies in masked form. This is our second alliance in this exciting area of research, and we have high hopes for this pro-body formula. With that, I will hand the call over to Carlos to review our financial update.

Non few constellation of B.

Increases its ability to deplete intra tumoral t. Rex based on the way the interacts with the target and T Reg cells.

Cells.

In the tumor so the so the basic I'd I.

Idea is that.

Increased intra tumoral T Reg depletion.

By the non few calls the least drastically.

Results in more potent anti cancer activity, because many believe that T regs accretion as the principal mechanism through which seems like for blockade works.

Challenge is that the more potent you make it be.

In five by by making the at S. version.

More toxic it gets because it did.

Its a activates immune cells.

Peripherally more effectively as well impart by by again by more powerfully down regulating.

Carlos Campoy: Thank you, Sean. I would now like to review the financial highlights for the second quarter ending June 2019. Revenue for the quarter was $16.6 million compared to $9 million in the corresponding period in 2019. The increase is primarily due to a higher percentage of project completion for CX904, our Amgen EGFR product candidate, and also the recognition of revenue related to the $80 million upfront payment received under the Estella's Agreement that we entered into in March 2020. Research and development expenses were $24 million for the quarter, compared to $30.8 million in the corresponding period in 2019. The decrease was largely attributed to one-time licensing fees created in 2019 and a decrease in clinical trial-related activities in 2020. We ended the quarter with cash, cash equivalents, and

Immunosuppressive T. Rex.

Carlos Campoy: million dollars compared to $296 million as of December 31st, 2019. We expect our strong balance sheet to allow us to meet projected operating requirements into the second half of 2022, assuming no new collaborations or financing. With that, I'll turn the call back. Great, thanks.

So if you look at the HCR poster.

What it shows it's actually pretty beautiful work it shows.

It shows that the.

[music].

Yes.

The underlying the post if you until I got the bodies for each <unk>.

But it'd be and for.

Yes. It is maintained with the probably body. Despite the mosques that's consistent with unmasking in the tumor.

From a toxicity standpoint, they demonstrated that the.

Hmm TD.

At the highest dose of any toxic dose for it'd be on for that for a body were fives and threefold higher based on the masking that we achieved with the pro body and in in the case of the the Longview calculated you can see from the data how much more toxic.

The Ns pretty body, the antibody is and how that per body protects so the basic idea is.

With the NSG Pro body is we've got a more it we've got a more active assay body, but it's more toxic weak if we can improve the therapeutic window of an s.. We could further improve on the two four night it'd be probably so it's kind of it.

Christopher Keenan: Great. Thanks, Carla.

Sean A. McCarthy: So let me wrap things up here, and then we'll go to questions. In summary, CytomX made broad progress across its clinical and preclinical programs during the second quarter, as we further advanced its technology, partnerships, and lead drug candidates to several important inflection points. We have continued to show leadership in defining new therapeutic antibody modalities with the potential to address significant unmet medical needs in the treatment of cancer. A mission that remains as important as ever, despite the unprecedented challenges being posed by the COVID-19 pandemic.

Next generation it'd be probably if you like.

That makes sense.

Well. This is that he has slowed and if I V or us one more.

It seems like your R&D expense.

During the quarter was declined significantly so any questions are you, calling us I mean, how should we think about.

For the expense, especially not any going forward, especially then got starting some more tries and probably they northern speed up now.

Sean A. McCarthy: We have now brought two previously undruggable targets into play in the oncology field with our platforms, CD166 and CD71, both of which we believe have broad potential in multiple care settings. And we'll be learning a lot more about these product candidates from our Phase 2 studies, which we expect to start reading out in late 2021. We're further extending our undruggable target strategy with the advancement of our bi-specific program targeting CD3 and EGFR, and with a drug conjugate targeting Epcan. These preclinical programs are taking great shape as our next IMD. We've also continued with our cancer immunotherapy strategy, leveraging clinically validated, The clinical data for our wholly-owned anti-PD-L1 pro-body Cx072 has continued to mature, affording us unique opportunities to advance innovative combination therapy, starting with CX-072 plus CX-073.

Yes that makes sense, if you noticed that it's.

We had a significant number.

Number of expenses that happened in Q1 that are one time, particularly around licensing fees that were associated with the milestones that we received.

In Q1, so I Q1 was the aberration not to and you should see it continue at a lower level than what you saw in Q1, and but we haven't really guided for the full year.

R&D expense line.

Great has some thank you very much.

Thank you.

Our next question comes from Joe classes Arrow, hyper family align or something.

Sean A. McCarthy: CXO7

Hey, guys. Thanks, so much for taking my question here, maybe just one quick one just wondering if you have any thoughts or whether the reached an AD com for the bcm A.D.C. and the ocular Tox discussion provides any any inside or future plans around CES 2009, Iraq, where.

Sean A. McCarthy: [inaudible] Our collaborative work with BMS on CTLA-4 has also provided important proof points for our platform, both clinical and preclinical, and we're delighted to see BMS 249 continuing to advance in the randomized phase 2 melanoma study in combination with NIVA. Our broad partnership strategy has also continued to deliver with

There are collecting the data or just how the FDIC thinks about that toxicity in the context of an advanced cancer population.

Sean A. McCarthy: this year, including the initiation of a major new alliance with Astellas and the progression of many additional preclinical programs across our collaborations, adding to the strength and depth of our pipeline. We continue to enjoy a robust cash position and remain highly focused on making the biggest difference we can for cancer patients as we continue to build our. Regarding COVID-19, CytomX has continued to perform very well despite the uncertainties and challenges presented by the pandemic. All of us at the company hope that you and your families are well and keeping safe during this time. And I would like to close by thanking our employees, our patients, our investigators, clinical trial staff, and everyone involved in helping us continue to drive forward with our mission of developing new medicines for the treatment of major unmet medical needs in oncology. With that, I'll hand the call back to Chris, and we'll open up for questions.

Yeah, Hi, Joe a great question, certainly something that we're looking at and at the time being you know we we haven't continue to remain.

Confident that we can manage talking to toxicities with the regimens when used previously with the airport costs of goods, but we're certainly going to learn everything we can from those discussions and or make any additional modification sort agreements that we maybe able to make but work in progress.

Okay. That's it for me thanks for taking my question.

You're welcome thanks.

Thank you I'm showing no questions at this time I like to turn the call back on the Doctor Mccarthy for any closing remarks.

Great. Thank you very much I once again I'd like to thank everyone for listening in today, we got to another very strong quarter and as I said, despite the many challenges presented to all of us by the a corporate 19 situation very proud of the team I'm proud of our progress as we move the pipe.

Operator: Thank you, Sean. Valerie, please open the Q&A. Thank you.

Operator: Ladies and gentlemen, if you'd like to ask a question, please press star and then 1 on your touch-tone telephone. Again, if you would like to ask a question, please press stars and 1. One moment for our first question. Our first question comes from Peter Lawson of Barclays. Your line is open. Hey, guys. This is Wally Dong for Peter.

Line.

And platform forward, so I hope everybody, a stays well stay safe and well look forward to talking to all against it.

Wally Dong: Thanks for taking the question. In the initial expansion study for CX2009, just wondering if you could give us a little bit more color and details on the revised patient enrollment criteria for the study and also, based on your discussions with the FDA, what is the bar you need to hit and what would be considered positive results in both HER2-negative breast cancer as well as triple negative breast cancer?

Thank you ladies and gentlemen does that concludes today's conference. Thank you offer participating you may have a great that you may now disconnect.

[music].

Sean A. McCarthy: Yes, great. Thanks for the question.

Sean A. McCarthy: So, regarding patient enrollment, the kinds of things that we're looking at, obviously, are given that the Phase 1 data for 2009 was generated in a very heavily pretreated patient population with a median number of prior treatments of 7 or 8, depending upon whether it was TNVC or hormone-receptive-positive. Obviously, we're looking to enroll a substantially less heavily pretreated patient population in the study. So, we've been fine-tuning that in recent months and, also, given the evolution of the landscape, giving a little bit more thought to prior treatment regimens that are allowed in the study in regards to the patient population. So those are the kinds of things that we're doing in this intervening period.

Sean A. McCarthy: Regarding the bar for activity, I want to emphasize this is still a relatively early exploration of 2009 in breast cancer. It is a rapidly evolving field, both in hormone-receptive-positive and triple negative. We haven't yet had formal discussions with FDA on these types of matters, but in triple negative, we're very well aware of the approval now of sastatuzumab and the activity that we've seen with that molecule in hormone-receptive-positive, where sastatuzumab is also active. So, we're mindful of the need to be competitive in this evolving landscape.

Sean A. McCarthy: Great, thank you. And then maybe just a question on BMS 249; do you have any idea of when we can see the next data readout from that study?

Sean A. McCarthy: Unfortunately, we don't at this stage. They are actively enrolling patients, have been, you know. Unfortunately, we can't speak to their timelines, unfortunately, or to the impact that COVID may be having on their enrollment. So we're just going to have to wait and see how that unfolds.

Wally Dong: Great. Thank you for taking the questions.

Sean A. McCarthy: You're welcome. Thank you.

Ixta Darao: Thank you. Our next question comes from Ixta Darao of Guggenheim Security. Your line is open.

Ixta Darao: The first one for me is a little clarity on the CX-072 combination with CX-2009. If that's what you said was that you plan to sort of initiate a study there in the second half of this year. And then just a quick question on Astellas by specific collaboration. You know, obviously, hematologic malignancies are where we've seen sort of the most success, but it's also kind of more, you know, crowded. And I wondered if you could talk a little bit about maybe where you and Astellas plan to sort of concentrate or focus your energy, if you will, in terms of the bi-specific landscape and where you may find indications, I guess, that are more appropriate for the technology. Thanks.

Sean A. McCarthy: Yes, great. Hi Esther.

Sean A. McCarthy: Thanks for the questions. So, yes, we are actively gearing up to start an expansion cohort or expansion cohorts in 2009 for triple negative, both as monotherapy and in combination with O7-2. I want to reiterate that we have seen single agent activity for both pro-bodies, O7-2 and 2009 in triple negative. So, we think this is an exciting experiment to do with the potential for competitive differentiation further down the road. So, that study, we aim to get up and running in the second half. [inaudible]

Sean A. McCarthy: Thank you all for joining us today, and I'm delighted with the specific focus of the programs there in terms of tumor types. I would just say, broadly speaking, that our strategy in using our ProBody masking technology on CD3 bi-specifics is From the CytomX point of view, it is largely directed at solid tumors where we see the need for substantial improvements because this has been a very tough area to break into for reasons of a very, very narrow and compressed therapeutic window with solid tumor targets. So, broadly speaking, we've developed the technology to address solid tumors. It certainly could have application in hematology. I can't speak specifically about style.

Ixta Darao: Great, and congrats on the progress.

Sean A. McCarthy: Great, thank you very much.

Terrence Flynn: Thank you. Our next question comes from Terrence Flynn of Goldman Sachs. Your line is open.

Terrence Flynn: Hi, thanks for taking the question. I was just wondering about 2029 regarding the phase two program. I know you ran through, it sounds like three different tumor types you're focused on there. Can you maybe just give some insight in terms of how many patients you think would be eligible if you looked at the U.S., EU5, and Japan for treatment here in 2029? Just trying to kind of think about the potential market opportunity. Thank you.

Sean A. McCarthy: Yeah, hi Clarence, great question. So, let me just run through the four expansions again for clarity. Thank you. Squamous, headin' back.

Sean A. McCarthy: Squamous Non-Small Cell Lung Squamous Esophageal, and then DLBCL. The first two indications... demonstrated. Confirmed.

Sean A. McCarthy: Partial Responses in Phase 1 Dose Escalation. Squamous esophageal cancer, we've shown preclinical activity in xenograft models, similarly DLBCL. It's really too early to tell at this stage, but we are optimistic, based on the phase one data, of course, that we have a very unique, active single agent against a previously undruggable target that has shown, in some of the case studies that we presented previously at ASCO, some pretty profound tumor regressions in patients with very late stage, very heavy tumor burden. The therapeutic window is clearly there at 3 mg per kg, but we need to do more work to establish how wide that therapeutic window is, which will ultimately dictate how far forward in lines of therapy we can bring this exciting drug candidate. So, Terrence, we just have a lot more work to do, but we're excited, and we think this program is going to have broad potential. Okay, thanks so much. Thank you.

Byron and Annette Jeffries: Our next question comes from Byron and Annette Jeffries. Your line is open. Make sure your phone is on mute, please. Hi guys. Thanks.

Byron and Annette Jeffries: Yeah, hi guys. Thanks for taking my questions.

Sean A. McCarthy: So on CX2029 for the dose expansion cohort, have you made any adjustments in this cohort that could lead to lower grade 3 or higher anemias and neutropenias that you observed in the dose escalation part?

Sean A. McCarthy: Yeah, hi, Barron. Well, I would just say that we're doing a couple of things on the hematologic side with 2029. As we've discussed previously, these are anticipated adverse events with this payload and, to some extent, with this target. We are doing more work to understand the etiology of the anemia over time, but in terms of steps that we're taking, they will include treating patients with red blood cell-generating growth factors like epiderivatives, and that's really all we can say right now. But I want to just remind everybody that the Phase I experience demonstrated that we were able to manage the anemia with red blood cell transfusions. This is something that oncologists are very used to doing, given many decades of experience with chemotherapies, and we're continuing to get a handle on the overall therapeutic window. We will continue to get a handle on the therapeutic window of this target and this agent as time goes on.

Sean A. McCarthy: And on the dose expansion, are you enrolling patients with high CD71 expression?

Sean A. McCarthy: We're not, we're not... Let me answer the question this way: we don't believe we have enough data yet, either preclinical or clinical, to draw any conclusions regarding the uh target level versus response. One of the things to consider is that CD71 is such an interesting target because it cycles.

Byron and Annette Jeffries: Great. Thanks for taking my questions.

Sean A. McCarthy: You're welcome.

Mayor Goldstein: Thank you. Our next question comes from Mayor Goldstein of Missoula. Your line is open. Great.

Mayor Goldstein: Thanks for taking that question. So, I had a question about CX072 and the environment for triple-negative breast cancer therapies. And if you should decide that that is not the best indication given the competitive landscape, is there a sort of plan B of what you might look at, what other trials you might look at? That's first of all. Second of all, I did have a question about CF-2029 and the decision to focus on squamous tumors rather than non-squamous ones, and there's something in the biology that we should be aware of.

Sean A. McCarthy: Yes, hi Mara, great questions. So with regard to CXO7-2, you know, Uh... A lot of this is about following the data, and as our data has continued to emerge and mature over time for CXO7-2 monotherapy and 2009, the concept of combining the two of these agents, which, as I mentioned earlier, both have single-agent activity at CNBC, combining them in that indication, we think makes a lot of sense in the context of the current competitive So we'll see. We'll run this expansion, and we'll see what we get. You're right. The landscape is constantly evolving. It's not a huge patient population, but we're really interested to see what this combination can do on CNBC. I. Question about squamous tumors, and actually, I'm sorry, let me answer the second part of your question on O7T, which is really related to the program strategy.

Sean A. McCarthy: Which is, as I said, we continue to follow the data. We've evolved towards a combination strategy, as you know, rather than driving monotherapies to registration. That is, the competitive landscape we see is just way too crowded for us to, at this point, without a partner to invest in driving the monotherapy to registration, at least at this stage. However, we do remain interested in potentially finding a partner for this asset over time, and that could help inform a future strategy as well.

Sean A. McCarthy: Regarding squamous tumors in 2029, again, follow the data. The clinical observations are really interesting and the kind of thing you keep your eyes open for when you run phase one studies. We are intrigued by the activity that we've seen in squamous head and neck and squamous lung. Why might that be, and is it, you know, is it a real signal in terms of that?

Sean A. McCarthy: relative to other tumor types. You know, that's why we need to run the expansions. Why might it be the case? It could relate to target, but as we just discussed, we have a very early understanding of target versus response. With CD721, we need to learn more there. Could it relate to the microenvironment? Possible. So we just need to do more work, but we think it's an intriguing clinical hypothesis, and sometimes phase one studies give you these great opportunities to follow the data into phase two, and that's exactly what we're doing. So we'll be learning more.

Mayor Goldstein: Okay, and if I could just squeeze one more in, I know obviously Bristol isn't in charge of the program for 2.9, but can you just remind us what the next financial milestone for that program is?

Sean A. McCarthy: So for 249, for the IPI pro body, it would likely be the initiation of a registrational study, but I'd have to go back and check. Okay, thank you.

Mohit Bansal: Thank you. Our next question comes from Mohit Bansal of the City of Yellowstone. Okay.

Mohit Bansal: Thanks for taking my question. So, I just wanted to probe a little bit further on the fecal-related pro-body approach. So, can you please help us understand what fecal cellation actually is, what difference does that make to the pro-body or antibody? And if I'm not mistaken, it seems like IPI's non-fecal-related version was also tested in clinics. So, is there anything we have learned from that compound that could be useful here?

Sean A. McCarthy: Yeah, hi Mohit, thanks for the question. So the concept... And this is articulated in the AACR poster that BMS presented a few months back. The concept is that non-pucosalation, um, increases its ability to deplete intratumoral Tregs based on the way that it interacts with the target and Treg cells in the tumor. So the basic idea is that increased intratumoral Treg depletion by the non-fucosylated antibodies results in more potent anti-cancer activity because many believe that Treg depletion is the principal mechanism through which CTLA-4 block Peripherally, more effectively as well, in part by, again, more powerfully downregulating the immunosuppressive Treg. So if you look at the AACR poster, what it shows, it's actually really beautiful work. It shows that the...

Sean A. McCarthy: The underlying potency of the underlying antibodies for each, for the NF, is maintained with the pro-body despite the mask, so that's consistent with unmasking in the tumor. From a toxicity standpoint, they demonstrated that the HNSTDs at the highest non-severely toxic dose for IPI and for the NF pro-body were five and three-fold higher based on the masking that we achieved with the pro- And in the case of the non-fucosylated, you can see from the data how much more toxic the NS pro-body, the antibody is, and how the pro-body protects. With the NF ProBody, we've got a more active antibody, but it's more toxic. If we can improve the therapeutic window of NF, we can further improve on the 249 IPI ProBody. So it's kind of a next generation IPI ProBody, if you like. I hope that made sense.

Mohit Bansal: Now, this is very helpful, and if I may ask one more question, it seems like your R&D expense declined significantly quarter over quarter, so maybe a question for you Carlos, I mean, how should we think about the expense, especially in R&D, going forward, especially when you are starting some more trials, and probably the enrollment will speed up. Yes, that makes sense. You noticed that we had a significant number of expenses that happened in Q1 that were one-time, particularly around licensing fees that were associated with the milestones that we received in Q1. So Q1 was the aberration, not Q2, and you should see it continue at a lower level than what you saw in Q1, but we haven't really guided for the full-year R&D expense line.

Carlos Campoy: Very helpful. Thank you very much. Thank you. Our next question comes from Joe Catanzaro of the Kuyper Family. Your line is open. Hey, guys. Thanks so much for taking my question here. Maybe just one quick one.

Joseph Michael Catanzaro: Just wondering if you have any thoughts or whether the recent ADCOMM for the BCMA-ADC and the ocular tox discussion provides any insight or future plans around CX2009, whether it's collecting the data or just how the FDA thinks about that toxicity in the context of an advanced cancer population.

Sean A. McCarthy: Yeah, Joe, great question. Certainly something that we're looking at. And at the time being, we have and continue to remain confident that we can manage oculotoxicity with the regimens that have been used previously with GAM4 conjugates, but we're certainly going to learn everything we can from those discussions and make any additional modifications or improvements that we may be able to make. But work in progress.

Joseph Michael Catanzaro: Okay, that's it from me. Thanks for taking my question. You're welcome, thanks.

Sean A. McCarthy: You're welcome. Thank you.

Sean A. McCarthy: Thank you. I'm showing no questions at this time. I would like to turn the call back over to Dr. McCarthy for any closing remarks.

Sean A. McCarthy: Great, thank you very much. Once again, I'd like to thank everyone for listening in today. We had another very strong quarter, and as I said, despite the many challenges presented to all of us by the COVID-19 situation, I'm very proud of the team and proud of our progress as we move the pipeline and platform forward. So I hope everybody stays well, stays safe, and we'll look forward to talking to you all again soon.

Operator: Thank you. Ladies and gentlemen, this does conclude today's conference. Thank you all for participating. You may have a great day. You may all disconnect. BF-WATCH TV 2021