Q1 2021 Nektar Therapeutics Earnings Call

Good day and thank you for standing by welcome to the Nektar Therapeutics first quarter 2021 financial results Conference call. At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question. During the session you will need to press Star and then one on your <unk>.

Operator: Good day, and thank you for standing by. Welcome to the Nektar Therapeutics First Quarter 2021 Financial Results Conference Call.

Operator: At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press the star and then one on your telephone. Please be advised that today's conference may be recorded. If you require any further assistance, please press star and then zero. And I'd like to hand the conference over to your speaker today, Ms. Jennifer Reddick, Head of Corporate Affairs. Ma'am, you may begin.

Telephone please be advised that today's conference maybe recorded if you require any further assistance. Please press star and then zero.

I would now like to hand, the conference over to your speaker today, Ms. Jennifer Ruddock head of corporate Affairs, Ma'am you may begin.

Thank you Crystal and good afternoon, everyone and thank you for joining us today.

Jennifer Ruddock: Thank you, Crystal, and good afternoon, everyone, and thank you for joining us today. With us on the call are Howard Robin, our President and CEO, Gil Laboucherie, our COO and CFO, Dr. Jonathan Zalevsky, our Chief of Research and Development, and Dr. Brian Kotson, our Interim CMO and Head of Development. On today's call, we expect to make forward-looking statements regarding our business, including clinical trial enrollment and clinical trial results, timing, and plans for future clinical trials.

With us on the call are Howard Robin, our President and CEO Gill of Bruce <unk>, our CEO and CFO, Dr. Jonathan <unk>, our chief of research and development and Dr. Brian Thompson, our interim CMO and head of development.

On today's call, we expect to make forward looking statements regarding our business.

Including clinical trial enrollment and clinical trial results timing and plans for future clinical trials timing.

Jennifer Ruddock: Timing and plans for future clinical data presentations, the therapeutic potential of our drug candidates, outcomes and plans for health authority regulatory actions and decisions, estimates and predictions of the COVID-19 pandemic's impact on our business and on clinical trials, financial guidance, and certain other statements regarding the future of our business. Because forward-looking statements relate to the future, they are subject to inherent uncertainties and risks that are difficult to predict, and many of which are outside of our control.

Timing and plans for future clinical data presentations, the therapeutic potential of our drug candidates.

Outcomes and plans for health authority regulatory actions and decisions.

<unk> from predictions of the COVID-19 pandemic impact on our business.

On clinical trials financial guidance and certain other statements regarding the future of our business.

Because forward looking statements relate to the future. They are subject to inherent uncertainties and risks that are difficult to predict and many of which are outside of our control.

Jennifer Ruddock: Important risks and uncertainties are set forth in the Form 10-K that was filed on February 26, 2021, which is available at sec.gov. We undertake no obligation to update any of these forward-looking statements, whether as a result of new information, future developments, or otherwise.

Important risks and uncertainties are set forth in our form 10-K that was filed on February 26, 2021, which is available at SEC Gov. We undertake no obligation to update any of these forward looking statements whether as a result of new information future development or otherwise a webcast of this call will be available on the IR.

Jennifer Ruddock: A webcast of this call will be available on the IR page of Nektar's website at Nektar.com. Before turning over the call to Howard, I'd like to remind you that since we're dialing in from different locations today, I will moderate the Q&A session for our team so we can avoid technical issues during the call. We appreciate your patience. With that said, I would like to hand the call over to our President and CEO, Howard Robin. Howard?

Page of <unk> website at <unk> Dot com before turning over the call to Howard I'd like to remind you that since we're dialing in from different locations today I will moderate the Q&A session for our team. So we can avoid technical issues. During this session. We appreciate your patience.

With that said I would like to hand, the call over to our President and CEO Howard Robin Howard.

Thank you Jennifer and thank you to everyone for joining us on the call today.

Howard W. Robin: Thank you, Jennifer, and thank you to everyone for joining us on the call today. We entered 2021 with a deep portfolio of candidates in immuno-oncology and immunology, spanning from phase one to phase three development. And we're looking forward to a steady cadence of key data readouts beginning later this year. These datasets have the potential to set Nektar on a new trajectory and transform the treatment of a range of tumor types in autoimmune disease.

We entered 2021 with a deep portfolio of candidates in immuno oncology and immunology spanning from phase one to phase III development and we're looking forward to a steady cadence of key data Readouts beginning later this year.

These datasets have the potential to set Victor on a new trajectory.

Transformed the treatment of a range of tumor types and auto immune disease.

Each investigational medicine in our portfolio provides us with its own distinct value and gives us the ability to broaden the patient populations that we could potentially search.

Howard W. Robin: Each investigational medicine in our portfolio provides us with its own distinct value and gives us the ability to broaden the patient populations that we could potentially serve. Our pioneering work designing novel cytokine conjugates as medicine has given us a leadership position in the field, and we continue to focus our research in this area and in the area of immune science, setting the stage for the next wave of I&D candidates for our company. So I'll start with a brief overview of the status of BEMPEG, our most advanced late-stage clinical program, and novel IL-2 pathway agony, which is being developed in combination with checkpoint inhibitors Apevo or Novolumab and Keytruda or Pembrolizumab.

Our pioneering work designing novel cytokine conjugates as medicine with <unk>.

Even us a leadership position in the field and we continue to focus our research in this area and in the area of immune songs setting the stage for the next wave of R&D candidates for our company.

So I'll start with a brief overview from the status of <unk>. Our most advanced late stage clinical program and novel IL, two pathway agonist, which is being developed in combination with checkpoint inhibitors Opdivo and.

And keytruda or Pember Elizabeth.

Our strategy for <unk> combined with these checkpoint inhibitors is focused on pursuing multiple large frontline adjuvant solid tumor settings.

Howard W. Robin: Our strategy for BEMPEG, combined with these checkpoint inhibitors, is focused on pursuing multiple large, front-line, and adjuvant-solid tumors, including melanoma, renal cell carcinoma, and bladder cancer with nivolumab, and Head and Neck Cancer and Non-Small Cell Lung Cancer with Pembrolizumab. The opportunity for combining FemPEG in these tumor settings is significant.

Melanoma renal cell carcinoma, and bladder cancer with Nevada and.

In head and neck cancer, and non small cell lung cancer with member Elizabeth.

The opportunity for combining <unk> and these tumor settings as significant 202020 sales of PD, one checkpoint inhibitors across these five tumor settings, where greater than $5 billion. So we're pleased with how <unk> is positioned in multiple registrational studies with our <unk>.

Howard W. Robin: Two hundred, two thousand twenty sales of PD-1 checkpoint inhibitors across these five tumor settings were greater than $5 billion. So we're pleased with how BEMPEG is positioned in multiple registrational studies and with our planning for additional strategic late-stage studies. The clinical program we've put in place over the last several years positions us far ahead of others pursuing IL-2 programs.

Planning for additional strategic late stage studies.

The clinical program, we put in place over the last several years positions us far ahead of others pursuing idled two programs in cancer.

Through our.

Howard W. Robin: Through our partnership with BMS, we have five ongoing registrational studies of BEMPEG with NEVO that are proceeding nicely. Our first three registrational studies to read out in the first half of 2022 are the Phase 3 study in metastatic melanoma, the Phase 3 study in renal cell carcinoma, and the Phase 2 accelerated approval study in cisplatin-ineligible bladder cancer. Also ongoing are two large phase three trials further up the line, one in adjuvant melanoma and one in muscle-invasive bladder cancer. Both indications offer an opportunity to expand the patient populations in melanoma and bladder cancer that could benefit from treatment with benboline.

<unk> with BMS, we have five ongoing Registrational studies of Mpeg would levo debt are proceeding nicely.

Our first three Registrational studies to read out in the first half of 2022 or the phase III study in metastatic melanoma.

The phase III study in renal cell carcinoma in the phase two accelerated approval study and cisplatin ineligible bladder cancer.

Also ongoing are two large phase III trials further up one one.

One in adjuvant melanoma, and one in muscle invasive bladder cancer.

Both indications offer an opportunity to expand the patient population in melanoma and bladder cancer that could benefit from treatment with bad debt.

In addition, BMS is conducting a phase II study in renal cell carcinoma for <unk> plus Nemo with at Teekay is to pave the way for future development of a teekay <unk> inclusive regimen in this setting first line RCC.

Howard W. Robin: In addition, BMS is conducting a phase two study in renal cell carcinoma for BEMPEG plus NEVO with a TKI to pave the way for future development of a TKI-inclusive regimen in the setting of first-line RCC. The study is designed to build on their recent successful approval of NEVO plus CATO. In terms of our strategy for BENTAG plus PEMBRO, our first priority is to focus on the largest settings where pembrolizumab is the gold standard of care, non-small cell lung cancer and head and neck, and where we have the ability in that setting to combine BEMPEG with PEMBRO and run a comparative study designed for registration purposes comparing it against monotherapy. For the first slide, head next.

The study is designed to build on their recent successful approval of <unk> plus Cabo.

In terms of our strategy per bed peg plus Pembroke.

Our first priority is to focus on the largest settings, where tempur Elysium App is the gold standard of care non small cell lung cancer, and head and neck cancer, and where we have the ability in that setting to combine <unk> with Pembroke and run a comparative study designed for registrational purposes, comparing against mono therapy Pembroke.

For the first line head and neck cancer indication in.

Howard W. Robin: In February, we announced two separate collaborations, one with SFJ and one with MERT, which allow us to fund and advance a new registrational study for BEMPEG plus PEMBRO versus monotherapy PEMBRO. And recently, two late-stage competing studies had negative data readouts in the first line setting. And as a result, the competitive landscape has so narrowed that we're excited about our decision and our ability to proceed with this study. Pembroke is now used in over 70% of patients in this setting and has replaced the extreme ratio.

In February we announced two separate collaborations one with SF Jay and one with Merck, which allows us to fund an advanced and new Registrational study for <unk>, plus <unk> versus monotherapy umbro.

And recently two late stage competing studies had negative data readouts in the first line setting and as a result, the competitive landscape is so narrowed that we're excited about our decision and our ability to proceed with this study.

<unk> is now used in over 70% of patients in this setting and has replaced the extreme regimen.

Howard W. Robin: The study is very much on track to start at the end of Q3 or early Q4. We estimate that this new opportunity in head and neck cancer could generate annual revenues of between $500 and $800 million globally, and so it represents a substantial value to the FemTAG development. In non-small cell lung cancer, Nektar is advancing our own Phase II study, known as PROPEL, studying BEMPEG plus PEMBR. We have been very pleased with the great interest in the study from leading thoracic oncology treatment sites.

<unk> is very much on track to start at the end of Q3 or early Q4, we estimate that this new opportunity in head and neck cancer could generate annual revenues of between 500 and $800 million globally and so it represents a substantial value addition to the <unk> development book.

And in non small cell lung cancer, Victor advancing our own phase II study known as the propel study them Peg plus Pembroke.

We have been very pleased with the great interest in the study from leading thoracic oncology treatment sites.

Howard W. Robin: While pembrolizumab has improved overall survival for patients with non-small cell lung cancer, its benefit is still limited to two years or so, and we believe there's an opportunity to increase the benefit, the treatment benefit, and develop a chemo-sparing regimen in this tumor set. We're planning our first formal data cut from the initial part of the study sometime in the second half of this year. As we track the double adenopropel, we will use these data to form our first phase three registrational trial strategy in non-small cell lung cancer, where we believe there could be a true differentiation in a chemo-sparing regimen. Now, to remind you, in the agreement with BMS.

While <unk> has improved overall survival for patients with non small cell lung cancer. It's benefit is still limited to two years or so and we believe theres an opportunity to increase the benefit the treatment benefit and develop a chemo sparing regimen in this tumor setting.

We're planning our first formal data cut from the initial part of the study sometime in the second half of this year.

As we track the doubling in propel we will use these data to form our first phase III Registrational trial strategy and non small cell lung cancer, where we believe there could be a true differentiation in a chemo sparing regimen.

Now to remind you and the agreement with BMS, we have a $1 $4 billion.

Howard W. Robin: We have a $1.4 billion filing and milestone approvals for BEMPEG in the U.S., Europe, and Japan. These are tied to any approval of BEMPEG, whether the approval is in combination with NEBO or not. They were eligible to receive $625 million for filings and approvals in the first indication and $260 million for each of the next three indications, again, regardless of whether the filing and approval is in combination with NEBO or With six registrational studies to support potential filings, we have many opportunities to bring these models into the market.

Filing in milestone approvals for <unk> in the U S Europe, and Japan, and these are tied to any approval of bad debt, whether it be approval is in combination with levo or not.

We're eligible to receive $625 million for filings and approvals in the first indication and $260 million for each of the next three indications again, regardless of whether the filing and approval is in combination with Nemo our Pembroke.

With six Registrational studies to support potential filings, we have many opportunities to bring in these milestones.

I'll now turn to Nektar $2 55, our second major cytokine program in immuno oncology.

Howard W. Robin: I'll now turn to Nektar 255, our second major cytokine program in immuno-oncology. This candidate is a remarkable development opportunity for us as a proliferator of natural killer cells that has also demonstrated its ability to expand CD8 T-cells and memory, providing us with an opportunity for Nektar 255 that could be more significant than Bempeg in different tumor types, as we are developing this differentiated IL-15 agent in early stage studies in both liquid and solid.

This candidate is a remarkable development opportunity for us as a proliferate or of natural killer cells, but it's also demonstrated its ability to expand CDA T cells and memory T cells.

These unique attributes provide us with an opportunity for Nektar 255 that could even be more significant than big bag in different tumor types.

We are developing this differentiated IL 15 agents and early stage studies in both liquid and solid tumors.

Howard W. Robin: Our first phase one, two clinical study focused on combining Nektar 255 with leading approved antibodies that use the mechanism of ADCC or antibody-dependent cellular cytotoxicity to kill cancer cells and which require functional natural killer cells for their mechanism of action. We know that long-term expansion of natural killer cells through an IL-15 mechanism can greatly enhance the activity of these ADCC agents, and we're focusing our initial clinical studies in liquid and solitude to demonstrate that Nektar 255, given in combination with these agents, increases clinical benefit for patients.

Our first phase one two clinical studies focused on combining metric $2 55, with leading approved antibodies that use the mechanism of ADC or antibody dependent cellular cytotoxicity.

To kill cancer cells.

Howard W. Robin: In liquid tumors, we're combining it with rituximab and daratuzumab, and in solid tumors, we're combining it with cetuximab. We will have our first data in combination with these agents by the end of this year. And we look forward to sharing these data, and Jay Z will talk more about our excitement for NECTA 255 in a moment.

Howard W. Robin: The third cytokine program in our portfolio is Nektar 358, which is being developed in autoimmune disease in partnership with Eli Lilly to address a broad range of autoimmune and inflammatory conditions. We currently anticipate Lilly will pursue phase two studies in at least four indications. Nektar 358, which was developed and discovered in our labs at Nektar, targets the interleukin-2 receptor complex in the body in order to stimulate proliferation of powerful inhibitory immune cells, known as regulatory.

Immune cells noticed regulatory T cells I activating yourselves, an extra 358 may have to bring the immune system back into balance.

Howard W. Robin: By activating these cells, Nektar 358 may act to bring the immune system back into balance. Together, with our partner Lily, we are the clear leader in this space and respect in respect to both our scope and our stage of development, And we're the only company to have reported the multiple-dose effect of our agent on T regulatory cells in patients. Brian will share more on this program later, but we've made great progress over the last six to nine months. The clinical program successfully transitioned from our development team to Lilly's team.

With our partner Lily, where the clear leader in this space and respect in respect to both our scope and our stage of development and we're the only company to have reported multiple dose effect of our agent on T regulatory cells can patients.

Brian will share more in this program later, but we've made great progress over the last six to nine months.

Clinical program successfully transition from our development team to Lily's team and Louis now has for clinical studies underway at 280 patient placebo controlled phase two study and Louis a 200 patient placebo controlled phase two study and ulcerative colitis and two ongoing separate phase one beast.

Howard W. Robin: And Louis now has four clinical studies underway: a 280 Patient Placebo-Controlled Phase 2 Study in Lupus, a 200-patient placebo-controlled phase 2 study in ulcerative colitis, and two ongoing separate phase 1B studies in psoriasis and ectopic dermatitis. There are plans for additional phase two studies to be added to the program, and lupus and ulcerative colitis alone could be very... The leading agent in lupus right now, Benlista, sells almost $800 million worldwide.

How to use and psoriasis and atopic dermatitis.

There are plans for additional phase two studies to be added to the program.

And lupus and and ulcerative colitis alone the opportunity for nectar 358 to be very significant the leading agent lupus right now bad list of cells almost $800 million worldwide.

But there's a great need from new and better treatment for these patients with an estimated 750000 patients from the U S now diagnosed with lupus.

Howard W. Robin: But there is a great need for new and better treatment for these patients, with an estimated 750,000 patients in the U.S. now diagnosed. Our early results are highly encouraging, and this led to a large dose-ranging placebo-controlled study of Nektar 358 in these patients, which started in Q3 of last year. We anticipate results from this study could come in 2020, and for Ulcerative Colitis. Current approved agents sell approximately $6 billion per year, with 600,000 patients in the U.S. and Europe alone diagnosed with moderate to severe ulcerative colitis.

How early results are highly encouraging and this led to a large dose ranging placebo controlled study a mixture 358, and these patients which started in Q3 of last year.

We anticipate results from this study could come in 2022.

And all sorts of colitis current approved agents sell approximately six <unk> $6 billion per year.

With 600000 patients in the U S and Europe alone diagnose diagnose with moderate to severe ulcerative colitis.

Howard W. Robin: We believe we have an opportunity to serve these patients with a better potential therapy. The phase two study in ulcerative colitis is now recruiting patients. And we're looking forward to the advancement of that program as well. We and our partner Lilly view Nektar 358 as a potential first-in-class resolution therapeutic that may address the underlying immune system imbalance in patients with many autoimmune and inflammatory conditions. Finally, our economics are significant here for Nektar 358 as our royalties in this agreement scale along with our development, which translates into significant ownership of an agent that is being broadly developed.

We believe we have an opportunity to serve these patients with it better potential therapy. The face to study and ulcerative colitis is now recruiting patients and we're looking forward to the advancement of that program as well.

We and our partner Lily do nectar 358, as a potential first in class resolution therapeutics that may address the underlying immune system imbalance in patients with many auto immune and inflammatory conditions.

Howard W. Robin: We're proud of the work we've done in this program and are excited about the recognition from Lilly, a leader in the autoimmune space, that Nektar 358 has the potential to help patients with a wide range of autoimmune and inflammatory conditions. You know, we also remain in a very strong financial position to execute against our deep and expanding pipeline. We ended the first quarter of 2021 with approximately $1.1 billion in cash and investments.

Howard W. Robin: And as you can see, Nektar has built an incredibly powerful pipeline of differentiated cytokine therapeutics that positions us well to build substantial value in multiple therapeutic areas. So I'd like to turn the call now over to Jay-Z, who will spend some time talking about the key development programs and the data readouts this year, as well as other updates. Jay-Z?

Jonathan Zalevsky: Thank you, Howard. Let me start with the BEMPEG program and timing for our registrational trial readouts, first for the first-line metastatic melanoma study, which is being run by our partner BMS. VMS has indicated that data from this trial would be available in the timeframe of late this year or in the first part of 2022. Now, this study evaluates the combination of BEMPEG plus nivolumab versus nivolumab monotherapy. And the design is modeled on a median progression-free survival, or PFS, for the nivolumab arm to be comparable to the 6.9 months observed in the CHECKMATE 067 study. But remember, since PFS is an event-driven analysis, a number of factors, including the rate of PFS event accumulation, might impact the timing.

Versus the volume that monotherapy and the design is modeled on a median progression free survival or PFS for the Nivola mab arm to be comparable to the $6 nine months observed in the checkmate <unk> study.

And remember and since PFS is an event driven analysis, a number of factors, including the rate of PFS event accumulation might impact the timing.

The next study, which sector is running is the phase III first line renal cell carcinoma study.

Jonathan Zalevsky: The next study, which Nektar is running, is the Phase III first-line renal cell carcinoma study. We expect that we will reach our first interim analysis for the primary endpoint of overall survival sometime in the first half of 2022. And as Howard stated earlier, VMS and Nektar are taking a comprehensive approach to developing BAMPEG plus nivolumab in this tumor type. VMS is conducting a phase 1-2 study in RCC that combines BEMPEG plus nivolumab with a TKI and allows us to compare this treatment to a nivolumab TKI regimen to pave the way for a TKI-inclusive regimen in RCC for the BEMPEG plus nivolumab doublets as well.

We expect that we could reach our first interim analysis for the primary endpoint of overall survival sometime in the first half of 2022.

And as Howard stated earlier, BMS and Nektar are taking a comprehensive approach to the development of dumb pipe plus the volume up in this tumor type.

MFS is conducting a phase one two study in RCC.

Bind them pegged plus the volume out where the TK I and allows us to compare this treatment to an Ebola mab teekay I regimen to pave the way for Teekay <unk> inclusive regimen in RCC for the <unk>, plus emboldened map doublet as well.

With respect to the phase II study in first line cisplatin ineligible Euro filial carcinoma. The study is designed to serve as a basis for a potential filing for accelerated approval from the <unk>.

Jonathan Zalevsky: With respect to the Phase 2 study, first-line cisplatin-ineligible urethelial carcinoma, the study is designed to serve as a basis for a potential filing for accelerated approval. The primary endpoints of overall response rate, or ORR, and duration of response, as determined by central radiology review, for about 110 CIS-ineligible urethelial carcinoma patients who have a baseline CPS score of 10 or lower as a measure of PD-L1 expression.

Primary endpoint of overall response rate or <unk> and duration of response as determined by Central Radiology review for about 110, CIS ineligible <unk> carcinoma patients who have a baseline Cps score of 10 are lower as a measure of PDL one expression.

Jonathan Zalevsky: For this study, we are looking to achieve a median follow-up for measuring duration of response of 18 months, and we expect our first data from this study in the middle of 2022. We also have two large phase three studies that build on our other work in urophilial carcinoma and melanoma. First, our muscle-invasive bladder cancer study, which is being run by BMS, is enrolling approximately 540 patients who will receive BEMPEG plus nivolumab or nivolumab mild therapy in the periadjuvant setting for the 12-month treatment period following surgery. As this study is large, we expect the first data readout to be in 2024. This study is also designed to serve as a confirmatory study for potential lexanomases approval in the cis-ineligible urethelial carcinoma setting.

For this study we are looking to achieve a median follow up for measuring duration of response of 18 months and we expect our first data from this study in the middle of 2022.

We also have two large phase III studies that build on our other work and your affiliate carcinoma melanoma.

First our muscle invasive bladder cancer study, which is being run by BMS is enrolling approximately 540 patients who will receive them pegged question of all the bad for <unk> monotherapy in the Peri adjuvant setting for the 12 month treatment period following surgery.

If this study is large.

The first data readout could be in 2024.

This study is also designed to serve as a confirmatory study for a potential accelerated approval and the system eligible you're appealing old carcinoma settings.

Second the adjuvant melanoma trial is enrolling approximately 950 patients within a 12 month treatment period post surgery, and an endpoint of event free survival.

Jonathan Zalevsky: Second, the adjuvant melanoma trial is enrolling approximately 950 patients within a 12-month treatment period post-surgery and an endpoint of event-free survival. The study is designed to position BEMPAG as the standard of care for the treatment of melanoma, building on the recent nivolumab approval in this group. This study, if successful, could significantly increase the number of melanoma patients that can benefit from the BEMPEG plus nivolumab combination. Initial data from this study are also expected in 2024.

The study is designed to position <unk> as the standard of care for the treatment of melanoma building on the recent in the volume out of approval in this setting.

This study if successful could significantly increase the number of melanoma patients that can benefit from the bump back plus the bold about combination.

Initial data from this study is also expected in 2024.

As Howard stated, we expect to report initial data from the propel non small cell lung cancer study in the second half of this year.

Jonathan Zalevsky: As Howard stated, we expect to report initial data from the PROPEL non-small cell lung cancer study in the second half of this year. As we've said in the past, we are looking for a maturity of at least two scans or more per patient on treatment so we can fully understand the potential clinical benefit of the doublet over time. The patients will be spread across three separate PD-L1 expression subgroups, and the study plan is designed to show the benefit of the BEMPEG plus pembrolizumab doubling compared to ORR rates achieved with single-agent pembrolizumab in the efficacy of valuable patients treated in the less than 1%, 1 to 49%, and greater than or equal to 50% PD-L1 expression subgroups.

As we've said in the past we are looking for a maturity of at least two scans or more per patients on treatment. So we can fully understand the potential clinical benefit of the Douglas overtime.

Patients will be spread across three separate PDL, one expression subgroups and the study plan is designed to show the benefit of the been pegged plus campbellism at doublet compared to historical or are rates achieved with single agent <unk> and the efficacy evaluable patients treated in the less than 1% once a 49%.

And greater than or equal to 50% PDL one expression subgroups.

In non small cell lung cancer, we know that the quantity of underlying inflammation in the tumor microenvironment has a big impact on the efficacy of single agent checkpoint inhibitors, such as time to lose about.

Jonathan Zalevsky: In non-small cell lung cancer, we know that the quantity of underlying inflammation in the tumor microenvironment has a big impact on the efficacy of single-agent checkpoint inhibitors, such as tantalizumab. This is defined by PD-L1 expressor status.

This is defined by PDL, one expression status and as we have discussed in the past single agent parallelism App has the most benefit in patients in the greater than 50% subgroup.

Jonathan Zalevsky: And as we have discussed in the past, single-agent permalizumab has the most benefits in patients in the greater than 50% subgroup. Given the mechanism of BEMPEG, which targets and increases the inflammatory state of the tumor microenvironment, we believe that the combination of BEMPEG and pembrolizumab in non-small cell lung cancer could improve the efficacy of the doublets in multiple PD-L1 expression subgroup We also recently added a chemotherapy combination to the Propel study in order to allow us to potentially include the doublet with chemo option in our phase three strategy.

Given the mechanism of <unk>, which targets an increase of the inflammatory state of the tumor microenvironment, we believe that the combination of impact and parallelism Abbott non small cell lung cancer could improve the efficacy of the doublet and multiple PDL one expression subgroups.

We also recently added a chemotherapy combination arm to the propel study in order to allow us to potentially include the doublet with chemo option in our phase III strategy.

Jonathan Zalevsky: The initial data from Propel and the additional work we are also doing with the Dublin combination with chemotherapy will allow us to determine a comprehensive phase 3 strategy for BEMPEG in non-small cell lung cancer, and we're looking forward to presenting data from the BEMPEG Quest-Friendly LizardMap double cohorts in the second half of 2021. For our new Registrational Phase 2-3 Trial in Head and Neck Cancer, we're sponsoring the study and are close to finalizing the protocol details with the FDA and our collaborators, Merck and SFJ. As Howard stated earlier, we are on track to start the study in the second half of this year.

Initial data from propel and the additional work. We are also dealing with the doublet in combination with chemotherapy will allow us to determine a comprehensive phase III strategy for <unk> in non small cell lung cancer.

Looking forward to presenting data from the <unk> quest embolism, a double cohorts in the second half 2021.

For our new Registrational phase two three trial in head and neck cancer. We're sponsoring the study and are close to finalizing the protocol details with the F D. A.

Operators, Merck and my subject.

As Howard stated earlier, we are on track to start this study in the second half of this year.

The 500 patient trial is designed to support a potential global registration for the <unk> plus timber iliza non doublet.

Jonathan Zalevsky: The 500-patient trial is designed to support a potential global registration for BEMPEG plus Pembrolizumab W. It includes an interim analysis of ORR after the first 200 patients are enrolled. If the ORR passes a pre-specified futility boundary, the study will continue, and the remaining 300 patients will be enrolled for the Phase III portion of the study, now with 500 patients being evaluated for the primary endpoints of ORR and overall survival We are excited about the potential of this doublet to increase and deepen the response versus pembrolizumab alone in this immune-sensitive cancer, especially given the data we have seen combining Bempeg, Clostridolamide, and melanoma, which is another immune-sensitive drug.

An interim analysis or are after the first 200 patients are enrolled.

If they are our passes a pre specified futility boundary study will continue and the remaining 300 patients will be enrolled to the phase III portion of this study and now 500 patients evaluated for the primary endpoints of <unk> and overall survival.

We are excited about the potential of this doublet to increase and deepen their response versus parent elysium out alone in this immune sensitive cancer.

Especially given the data we have seen combining been pegged cluster Ebola mab in melanoma, which is another immune sensitive cancer.

Historically IL two has shown activity and had a net cancer with several published studies in both the metastatic and adjuvant settings, and we're very excited to develop them pegged plus cannibalism out here.

Jonathan Zalevsky: Historically, IL-2 has shown activity in adeninet cancer, with several published studies in both the metastatic and adjuvant setting, and we're very excited to develop BEMPEG plus Pembrolizumab here. Additionally, there are limited late-stage studies going on in this frontline indication, and there have been several recent failures of other mechanisms in the front line.

Additionally, there are limited late stage studies going on in this frontline indication there have been several recent failures of other mechanisms in the frontline. So we see this as a unique opening for us to establish them pegged as the first IL, two mechanism and head and neck cancer.

Jonathan Zalevsky: So we see this as a unique opening for us to establish FEMPEG as the first IL-2 mechanism and head in that campaign. For our COVID-19 study, we remain on track to report data from this study by the middle of this year. As a reminder, last November, we started this Phase 1B randomized double-blind placebo-controlled trial evaluating single doses of BEMPEG given to up to 30 adult patients with a confirmed COVID-19 infection who have mild symptoms. The primary objectives of the trial are to establish the tolerability of DEMPA agitations with mild COVID-19, evaluate the changes in immune activation over time, and identify a recommended dose for the next study.

For our COVID-19 study we remain on track to report data from this study by the middle of this year.

As a reminder, last November we started this phase one being randomized double blind placebo controlled trial evaluating single doses of impact given to up to 30 adult patients with a confirmed COVID-19 infection, who have mild symptomology.

The primary objectives of the trial are to establish the tolerability of <unk> patients with mild COVID-19.

To evaluate the changes in the immune activation overtime and identify a recommended dose for the next study.

Jonathan Zalevsky: The study is proceeding very nicely, and we are currently enrolling patients into our last dose cohorts of patients. We are on track to report the first data this summer, and this will help us shape the potential future development path for BEMTAG in this setting, based upon the current treatment landscape, and turn to Nectar 255, our IL-15 agonist program. The importance of natural killer cell biology in the treatment of cancer is becoming widely recognized.

The study is proceeding very nicely and we are currently enrolling until our last dose cohorts of patients. We are on track to report. The first data. This summer and this will help us shape the potential future development path for <unk> tag in this setting based upon the current treatment landscape.

And turning to Nektar 255, our IL 15 agonist program.

The importance of natural killer cell biology, and the treatment of cancer is becoming widely recognized we've.

Jonathan Zalevsky: We've accessed the rich biology and therapeutic potential of natural killer cells with the discovery and development of Nektar 255, an agent that engages the full biology of the IL-15 pathway. Moreover, the holistic function of engaging the IL-15 pathway with Nektar-255 can provide functional activation and homeostatic control of IL-15-responsive immune cells, ganglion natural killer cells, CD8 T-cells, and immune memory subsystems The biology unleashed by Nectar 255 can be combined with multiple mechanisms ranging from targeted agents to cell therapy and even to immunological checkpoints to potentially improve their efficacy. For example, our first clinical studies focused on targeted antibodies that function through an ADCC mechanism of action.

We access the rich biology, and therapeutic potential of natural killer cells with the discovery and development of an extra $2 55.

And agents that engages the full biology of the IL 15 pathway.

Moreover, the holistic function of engaging the IL 15 pathway with Nektar 255 can provide functional activation and homeostatic control of IL 15, responsive immune cells, namely.

Namely natural killer cells, CDA T cells and immune memory subsets.

The biology unleashed by Nektar 255 can be combined with multiple mechanisms ranging from targeted agents to cell therapy, and even to immunological checkpoints to potentially improve their efficacy.

Our first clinical studies focused on targeted antibodies that function through an ADC sea mechanism of action.

Jonathan Zalevsky: And we've developed a clinical strategy to combine Nektar-255 with leading targeted antibodies in both liquid and solid tumors. We expect to have several initial data readouts for multiple studies capturing single-agent Nektar-255 dose escalation and combination with at least one targeted antibody in the second half of this year. We are looking forward to sharing these initial findings.

And we've developed a clinical strategy to combined with leading targeted antibodies in both liquid and solid tumors.

We expect to have several initial data readouts from multiple studies, capturing single agent an extra $2 55 dose escalation.

In combination with at least one targeted antibody in the second half of this year.

We're looking forward to sharing these initial findings.

For our phase one two study in patients with relapsed refractory hematologic malignancy.

Jonathan Zalevsky: For our Phase 1-2 study in patients with relapsed refractory hematologic malignancy, we've reported encouraging initial data at 50-2020 in November in patients with multiple myeloma and non-Hodgkin's lymphoma, or NHL, which show that Nectar 255 is increasing NK cells in these patients. And we demonstrated additional dose-dependent pharmacodynamic changes and encouraging early signs of clinical We expect to complete the dose escalation monotherapy portion of the study in the first part of 2021, with data from dose escalation to be presented later this year.

Reported encouraging initial data in 2020 and November in patients with multiple myeloma, and non Hodgkin's lymphoma, or NHL, which show that metric to 55 is increasing NK cells in these patients.

And we demonstrated additional dose dependent pharmacodynamic changes and encouraging early signs of clinical activity at <unk> 255, as a single agent in these early dose cohorts.

We expect to complete the dose escalation monotherapy portion of the study in the first part of 2021 with data from dose escalation to be presented later this year.

Once dose escalation is complete and we have identified a recommended phase II dose, we will expand into several arms. The approximately 20 patients per arm.

Jonathan Zalevsky: Once dose escalation is complete and we've identified a recommended phase 2 dose, we will expand into several arms with approximately 20 patients per arm. One arm will evaluate Nektar 255 as monotherapy or in combination with rituximab in third-line or greater follicular lymphoma or low-grade NHL. Another arm will evaluate Nektar 255 as a monotherapy and in combination with Darzalex FastPro, a third line of treatment for greater multiple myeloma, and One Arm will evaluate Nectin-255 as a model therapy for NHL patients who have previously progressed following approved CD19 CAR-T cell therapy.

One arm will evaluate nektar 255, as monotherapy or in combination with Rituximab in third line or greater Follicular lymphoma or low grade in NHL.

Another arm will evaluate an extra 255 as a monotherapy and in combination with Darvill ex bass pro in third line or greater multiple myeloma and.

In one arm will evaluate <unk> 255, as a monotherapy for NHL patients from her previous they progressed following approved CD 19 car T cell therapies.

Our second clinical study is evaluating Nektar 255 in combination with Cetuximab in two distinct groups of highly refractory late line patients with metastatic colorectal cancer or head and neck cancer.

Jonathan Zalevsky: Our second clinical study is evaluating Nektar 255 in combination with Tuximab in two distinct groups of highly refractory late-lying patients with metastatic colorectal cancer or head and neck cancer. We are enrolling up to 80 patients in the U.S. and Europe.

We are enrolling up to 80 patients in the U S and Europe.

As you know cetuximab because of very low response rate about 10 or 15% of the settings and our goal is to improve upon that with the addition of metro to 55.

In this study begins with a dose escalation combination arm and we've already treated patients here at our lowest dose and are proceeding to the next dose level.

Jonathan Zalevsky: As you know, Cituximab has a very low response rate, about 10 or 15% in these settings, and our goal is to improve upon that with the addition of Nektar 255. And this study begins with a dose-escalation combination. And we've already treated patients here at our lowest dose and are proceeding to the next dose level. As I stated, because of the low response rate achieved with Cetuximab alone, there was a high unmet need in this later stage setting.

They stated because of the low response rate achieved with Cetuximab alone there was a high unmet need in this later line setting.

If we are able to demonstrate a higher response rate we will have several potential paths forward with Nektar 255.

Now after the dose finding portion for the combination study will then expand into dedicated cohorts for colorectal cancer and had a net cancer patients we.

Jonathan Zalevsky: Once we are able to demonstrate a higher response rate, we will have several potential paths forward with NECTAR 255. After the dose-finding portion for the combination, the study will then expand into dedicated cohorts for colorectal cancer and head and neck cancer patients. We expect to have some initial data from the dose finding portion of the study later this year. Now, before I hand the call to Brian, I'd like to provide a brief update on our next wave of research activity.

We expect to have some initial data from the dose finding portion of this study later this year.

Now before I hand, the call to Brian I'd like to provide a brief update on our next wave of research activities.

And our research and discovery laboratories, we continue our pioneering work based on our Rich foundation expertise in immune science cytokine biology and polymer chemistry.

It goes without saying that the application of polymer chemistry has dramatic potential to improve the pharmacological properties of proteins specialty cytokines.

Jonathan Zalevsky: In our research and discovery laboratories, we continue our pioneering work based on our rich foundation and expertise in immune science, cytokine biology, and polymer chemistry. It goes without saying that the application of polymer chemistry has dramatic potential to improve the pharmacological properties of proteins, especially cytokines. At Nektar, we have provided three clear examples in BEMPEG, Nectar 358, and Nectar 255.

The nectar, we have provided three clear examples and been pegged.

An extra $3 58, and Nektar $2 55.

We continue this work with emphasis on other cytokines and their therapeutic applications inside and outside of oncology.

This is a very rich target space for us because there are many cytokines target diversed biological processes and with polymer chemistry, we can employ multiple drug ability vectors for reach the desired biology.

Jonathan Zalevsky: We continue this work with emphasis on other cytokines and their therapeutic applications inside and outside of oncology. This is a very rich target space for us because there are many cytokines that target diverse biological processes. And with polymer chemistry, we can employ multiple drug ability vectors to reach the desired biology.

Additionally, we focus our immune science expertise to consider other platform modalities beyond polymer chemistry on a case by case basis, depending on the targets.

And the therapeutic hypothesis.

Jonathan Zalevsky: Additionally, we focus our immune science expertise to consider other platform modalities beyond polymer chemistry on a case-by-case basis, depending on the target and the therapeutic hypothesis. Earlier this year, we announced a discovery collaboration with Biologique Design to develop therapeutic antibodies against a very important target in India. Through this collaboration, we seek to further strengthen our pipeline and expand our modality footprint. We continue our efforts with preclinical advancement of our IND-enabling programs, and I look forward to sharing additional updates on this work in the future. I'll now turn the call over to Brian to review the NECTAR 358 program in more detail. Thank you, Jay-Z.

Earlier this year, we announced the discovery collaboration that biologic design to develop therapeutic antibodies against the very important targeting the immune system.

In this collaboration we seek to further strengthen our pipeline and expand our modality footprint.

We continue our efforts with preclinical advancement of our IND, enabling programs and I look forward to sharing additional updates on this work in the future.

I'll now turn the call over to Brian to review the neck at 358 program in more detail.

Thank you Jesse.

As Howard said earlier, we are very pleased with the broad scope and progress of the vector three five day program by our partner Eli Lilly.

Following positive data in lupus patients last year.

We commenced the phase II study in lupus.

Earlier this year by the initiation of a phase II study in ulcerative colitis Lilly.

Brian Kotson: As Howard said earlier, we are very pleased with the broad scope and progress of the Nektar 35A program by our partner Eli Lilly. Following positive data in lupus patients last year, Lilly commenced the phase two study in lupus, followed earlier this year by the initiation of a phase two study in ulcerative colitis. Lilly also continues to advance the two separate Phase 1B studies in psoriasis and a

He also continues to advance the two separate phase one studies in psoriasis and atopic dermatitis.

The rationale for T regulatory cell or a T. Reg mechanism in the treatment of autoimmune disease. This is compelling and based upon extensive evidence of the role of the malfunctioning or imbalanced immune system as the underlying cause of the clinical manifestations of these diseases.

Brian Kotson: The rationale for T-regulatory cell or T-reg mechanism in the treatment of autoimmune diseases is compelling and based upon extensive evidence of the role of the malfunctioning or imbalanced immune system as the underlying cause of the clinical manifestations of these diseases. Many autoimmune and inflammatory disorders, including systemic lupus and ulcerative colitis, are associated with decreased Treg numbers, reduced Treg function, and or reduced production of IL-2. With Nektar 358 and other IL-2-like molecules, our goal is to address these Treg abnormalities and to develop an IL-2-like molecule that could selectively stimulate Tregs in a more effective manner than native low-dose IL-2.

Many autoimmune and inflammatory disorders, including systemic lupus and ulcerative colitis are associated with decreased T. Reg numbers reduce T reg function and or reduced production mobile too.

With Nektar three five day, our goal is to address these T Reg abnormalities and to develop an IL two like molecule molecule that could selectively stimulate T regs and a more effective manner than native low dose IL two.

Data presented last year at both <unk> and the American College of Rheumatology meeting highlighted the potential of our approach importantly, we saw a dose dependent and profound increase from T regs and T Reg subsets.

Brian Kotson: Data presented last year at both ULAR and the American College of Rheumatology meeting highlighted the potential of our approach. Importantly, we saw a dose-dependent and profound increase in Tregs and Treg subsets induced by Nektar 358 in patients with mild to moderate lupus. We also saw improvement in lupus skin disease activity with Nektar 358. These exciting data led Lilly to initiate a Phase II study in lupus with Nektar 358.

Induced by Nektar 358 in patients with mild to moderate lupus. We also saw improvement in lupus skin disease activity with Nektar three five day.

These exciting data led literally to initiate a phase II study in lupus with moderate to severe systemic lupus.

In the phase II study in lupus, which began dosing patients from quarter. Three of 2020 280 patients are being randomized to one of three doses of <unk> five eight or placebo administered every two weeks for a treatment period of 24 weeks.

Brian Kotson: Study in Lupus Patients with Moderate to Severe Systemic Lupus.

Primary endpoint in the Phase II study is the percentage of patients achieving at least a four point reduction in the SLE disease activity index or sleet ice Gill stay.

Brian Kotson: In the phase 2 study in lupus, which began dosing patients in quarter 3 of 2020, 280 patients are being randomized to one of three doses of MECTA-358 or placebo administered every two weeks for a treatment period of 24 weeks. The primary endpoint in the phase 2 study is the percentage of patients achieving at least a 4-point reduction in the SLE Disease Activity Index, or SLEDI scale. Standard clinical composite endpoints used in lupus studies are also included as secondary endpoints.

Standard clinical composite endpoints used in lupus studies are also included a secondary endpoints. We will also characterized pharmacokinetics pharmacodynamics and immunogenicity and treated patients and.

Endpoints will be measured at week 24, and we expect this study to be completed within 18 to 24 months.

Earlier this year Lilly also initiated a phase two randomized placebo controlled trial in patients with ulcerative colitis that began enrolling patients in quarter one of 2021.

Brian Kotson: We will also characterize pharmacokinetics.

As in lupus there is considerable evidence from the literature on the role of T. Regs in employing batori bowel diseases, such as ulcerative colitis.

Brian Kotson: Pharmacodynamics, and Immunogenicity in Treated Patients. Endpoints will be measured at week 24, and we expect the study to be completed within 18 to 24 months.

Reduced numbers and functionality of peripheral T. Reg cells has been noted in these patients and there is also evidence that in an appropriate balance between functional T regs and T effect yourselves in the intestinal microenvironment contributes to inflammatory lesions. So we are excited to pursue ulcerative colitis with nektar three by.

Brian Kotson: Earlier this year, Lilly also initiated a phase two randomized placebo-controlled trial on patients with ulcerative colitis that began enrolling patients in quarter one of 2021. As in lupus, there is considerable evidence in the literature on the role of Tregs in inflammatory bowel diseases such as ulcerative colitis. Reduced numbers and functionality of peripheral Treg cells have been noted in these patients, and there is also evidence that an inappropriate balance between functional Tregs and T effector cells in the intestinal microenvironment contributes to inflammatory lesions.

Five day and expand this program with our partner Lilly.

Buddy will evaluate multiple dose levels during the initial induction period using an adaptive design total enrollment is planned to be a 200 patients in the trial endpoint as the percentage of patients with clinical remission after induction treatment at 12 weeks.

In addition, as Howard stated earlier, we know that Lilly is planning to continue to grow the development program for Nektar three five day. There are plans for two additional phase II studies to be initiated within the next nine to 12 months and as yet undisclosed indications. We are pleased with lilly's rapid advancement of the program and there.

Brian Kotson: So we are excited to pursue ulcerative colitis with Nektar 358 and expand this program with our partner, Lilly. The study will evaluate multiple dose levels during the initial induction period using an adaptive design. Total enrollment is planned to be 200 patients, and the trial endpoint is the percentage of patients with clinical remission after induction treatment at 12 weeks. In addition, as Howard stated earlier, we know that Lilly is planning to continue to grow the development program for Nektar 358.

Desire to develop this agent broadly in inflammatory and autoimmune diseases.

Finally, we look forward to the potential presentation from the phase one b work ongoing in psoriasis and atopic dermatitis with Nektar three five day with data from at least one of these studies to be presented at a medical meeting in the next year.

I will now turn the call over to Gil for a review of the financials.

Thank you, Brian and good afternoon, everyone.

On this call I'll review, our 2020, one financial guidance, which is unchanged for the year.

We ended the first quarter and an exceptionally strong financial position with $1 1 billion in cash and investments.

Brian Kotson: There are plans for two additional phase two studies to be initiated within the next nine to 12 months with an as yet undisclosed indication. We are pleased with Lilly's rapid advancement of the program and their desire to develop this agent broadly in inflammatory and autoimmune diseases. Finally, we look forward to the potential presentation.

During the quarter, we were pleased to announce that we entered into strategic collaborations with S. F J pharmaceuticals and Merck.

Under the terms of these agreements assets Jay has committed to fund up to 150 million to support the been pegged Registrational study in head and neck cancer, and Merck will contribute pember Elysium mab at no cost to nectar.

Brian Kotson: and from the Phase 1B work ongoing in psoriasis and atopic dermatitis.

Brian Kotson: and Atopic Dermatitis with Nektar 358, with data from at least one of these studies to be presented at a medical meeting in the next year. I will now turn the call over to Gil for a review of the financials.

S. F. J is entitled to success payments based only on FDA approval of them pegged in first line metastatic melanoma.

Head and neck cancer, and one other been vague indication.

Gil Laboucherie: Thank you, Brian, and good afternoon, everyone. On this call, I will review our 2021 financial guidance, which is unchanged for the year. We ended the first quarter in an exceptionally strong financial position with $1.1 billion in cash and investment. During the quarter, we were pleased to announce that we entered into strategic collaborations with SFJ Pharmaceuticals and Merck. Under the terms of these agreements, SFJ is committed to fund up to $150 million to support the BEMPEG Registrational Study in Head and Neck Cancer, and Merck will contribute Pembrolizumab at no cost to Nektar. SFJ is entitled to success payments based only on FDA approval of BEMPEG in first-line metastatic melanoma, head and neck cancer, and one other BEMPEG indication.

We were very pleased with the risk reward structure of these collaborations giving us the ability to add another very large indication opportunity to the been pegged portfolio.

Our projected cash usage for 2021 is unchanged from our February earnings call and.

And we still plan to end the year with at least $750 million in cash and investments.

Our full year GAAP revenue guidance remains unchanged at approximately 100 million for 2021.

And includes between 15 and $20 million of product sales.

And 80, and 85 million of noncash royalties.

We expect to recognize this revenue on a fairly ratable basis during the year.

Our GAAP R&D expense guidance is also unchanged for the year, we anticipate 2021 GAAP R&D expense will range between 450 and $500 million.

Gil Laboucherie: We are very pleased with the risk-reward structure of these collaborations, giving us the ability to add another very large indication opportunity to the BEMPEG portfolio. Our projected cash usage for 2021 is unchanged from our February earnings call, and we still plan to end the year with at least $750 million in cash and investments. Our full-year GAAP Revenue Guidance remains unchanged at approximately $100 million for 2021 and includes between $15 million and $20 million of product sales and 80 and 85 million of non-cash royalties. We expect to recognize this revenue on a fairly rateable basis during the year. Our GAAP R&D expense guidance is also unchanged for the year.

Our R&D guidance includes a significant noncash component of approximately 85 million, which is comprised of $30 million of noncash development expenses for the Ben Peg head and neck study.

Which is being funded by S F J, but which will continue to be reflected as a component of our R&D expense.

And approximately 55 million of noncash depreciation and stock compensation expense.

Our G&A expense guidance for 2021 is still projected to be between 120 and $125 million.

And includes approximately 45 million of noncash depreciation and stock compensation expense.

Our noncash interest expense is expected to be between 50, and 60 million arising from the monetization of our royalty streams.

Gil Laboucherie: We anticipate 2021 GAAP R&D expense will range between $450 and $500 million. Our R&D guidance includes a significant non-cash component of approximately $85 million, which is comprised of $30 million of non-cash development expenses for the BEMPEG Head & Neck Study, which is being funded by SFJ, but which will continue to be reflected as a component of our R&D expense, and approximately $55 million of non- Our G&A expense guidance for 2021 is still projected to be between $120 and $125 million and includes approximately $45 million of non-cash depreciation and stock compensation expense.

Additionally.

Our non operating expense includes the accounting for the contingent success based payments to S. F J as a derivative liability.

Over time, we will assess the probability of S. F J, earning the success payments and recognize the expense on our income statement with a corresponding increase to the derivative liability based on a probability adjusted and weighted discounted cash flow model that we would examine on a quarterly basis.

As I reviewed on our February call. We continue to expect approximately $15 million of noncash expense related to the Remeasurement of this delivered derivative liability during 2021.

And with that I will open the call to questions operator.

Thank you.

As a reminder to ask a question you will need to press Star and then one on your telephone to withdraw.

Your question. Please press the pound key.

The interest of time, we do ask that you. Please limit yourself to one question at this time.

Gil Laboucherie: Our non-cash interest expense is expected to be between $50 and $60 million, arising from the monetization of our royalty stream. Additionally Our non-operating expense includes accounting for the contingent success-based payments to SFJ as a derivative liability. Over time, we will assess the probability of SFJ earning these success payments and recognize the expense on our income statement with a corresponding increase to the derivative liability based on a probability-adjusted and weighted discounted cash flow model that we will examine on a quarterly basis.

And our first question comes from Peter Lawson from Barclays. Your line is open.

Great. Thanks for taking the questions. Thanks stay up day, one of the propel study and your life, what's the amount of data that we could potentially see in the second half of this year.

Okay. Thanks, Peter J D do you mind, taking the fun.

Yeah sure.

Peter This is Jay Z. Thank you for the question.

So as we gave an update them both at JP Morgan and even earlier this year. So the way the study is designed.

Gil Laboucherie: As I reviewed on our February call, we continue to expect approximately $15 million of non-cash expense related to the remeasurement of this derivative liability during 2021. And with that, I will open the call to questions. Operator. Thank you.

Is that it's designed to enroll approximately 60 patients and those patients are stratified across three different PDL one expression subgroups.

And it's approximately 20.

Operator: As a reminder, to ask a question, you will need to press star and then 1 on your telephone. To withdraw your question, please press the pound key. In the interest of time, we do ask that you please limit yourself to one question at this time. And our first question comes from Peter Lawson from Barclays. Your line is open.

Across each of the subgroups.

And then as we explained late last year, we saw a real increased rate in the amount of accrual of patients and we talked about before I'd had a lot to do with sort of the reduction in a lot of COVID-19 intensity in Europe, and a lot of our European sites really enrolling very very quickly.

Operator: Thanks, Peter. Jay-Z, do you mind taking this one? Yeah, sure. Hey, Peter. This is Jay-Z. Thank you for the question.

And so with the patients we intend to follow them for a very long period of time with at least two scans.

Jonathan Zalevsky: Yes, sure. Hey Peter, this is Jay Z.

Jonathan Zalevsky: Thank you for the question. As we gave an update both at J.P. Morgan and even earlier this year, the way the study is designed is that it's designed to enroll approximately 60 patients, and those patients are stratified across three different PD-L1 expression subgroups, and there are approximately 20 patients across each of the subgroups. And then, as we explained late last year, we saw a real increased rate in the amount of accrual of patients. And as we talked about before, it had a lot to do with sort of the reduction in a lot of COVID intensity in Europe. And a lot of our European sites really enrolled very, very quickly.

David It worked for the patient to provide a very rich and mature dataset.

And we target our second half of the year presentation, we will be presenting the totality of data that you can expect to see from such a phase II study. So for all of the patients will present the response rates per.

Was that all the additional composites Oh the response such as the complete response rates of depth of response duration of response any of the time to event kind of endpoints along with all of the safety information that we've accumulated.

Jonathan Zalevsky: And so, with the patients, we intend to follow them for a very long period of time with at least two scans of data worth for the patients to provide a very rich and mature data. And when we target our second half of the year presentation, we'll be presenting, you know, the totality of data that you can expect to see from such a phase two study. So for all of the patients, we'll present the response rate, will present all the additional composites of the response, such as the complete response rate, the depth of response, the duration of response, any of the time to event kind of endpoints, along with all of the safety information that we've accumulated from the patients, as well as some of the biomarkers that we've also collected, both from available tumor biopsies as well as whole blood samples.

From the patients as well as some of the Biomarkers that we've also collected them both from available tumor biopsies as well as whole blood samples.

And the kind of benchmark that we've talked about thinking about this kind of study is there are some reasonable information for single agent parallelism app across the PD L. One subgroups.

Less than one per cent, we've seen about an 8% response rate for single agent Umbro from keynote one.

In the 1% to 49% a subgroup we've seen a response rate of about <unk> 15 per cent for single agent Pembroke and in the greater than 50% you've seen a response rate of 40 to 45 and so those are the kinds of benchmarks to keep in mind as we think about the data from this study.

Jonathan Zalevsky: And the kinds of benchmarks that we talked about thinking about this kind of study are there are some reasonable Information for Single-Age and Pembrolizumab across the PD-L1 subgroup. In the less than 1%, we've seen about an 8% response rate for single agent PEMBRO from keynote one. In the 1 to 49% subgroup, we saw a response rate of about 15% for single-agent PEMBRO. And in the greater than 50%, we saw a response rate of 40 to 45. And so those are the kinds of benchmarks, you know, to keep in mind as we think about the data from this study. Thanks for the question.

Thanks for the question. Thank you.

And then just a follow up debt does that I guess, the third arm with chemotherapy and in the propel lung when should we see day through around that.

Yeah. So we just started to open those cohorts.

So they're just starting you know isn't there a accrual so we would expect to see data in the future well into next year.

Jonathan Zalevsky: in the Papel Lung. When should we see data around that as well?

Okay. Thank you so much thanks for taking the questions.

Thank you.

Jonathan Zalevsky: Yeah, so we just started to open those cohorts, so they're just starting, you know, in their accrual. So we would expect to see data in the future, well into next year.

Our next question comes from Jay Olson from Oppenheimer. Your line is open.

Oh, Hey, thanks for taking the question.

Operator: Our next question comes from Jay Olson from Oppenheimer. Your line is open.

As non chemo triplets becomes.

Operator: As non-chemo triplets become increasingly promising, can you comment on where the triple combo of Benpeg plus Nevo plus TKI would fit in RCC and the potential to move a triplet combo like that into earlier lines of non-small cell lung cancer? Thank you. Jay, Jay-Z, do you want to take that question?

Creasing the promising.

Can you comment on where the triple combo of been pegged listen Evo plus T K, I would which sit in RCC and.

The potential to move a trick, which combo like that into earlier lines of non small cell lung cancer. Thank you John.

J J D D.

I think that quite sure.

Jonathan Zalevsky: Sure. Yeah. Yeah.

Yeah, Yeah. Thank you for the question. So I think certainly we've seen the the real impact right of the Teekay I combination with a checkpoint inhibitor in.

Jonathan Zalevsky: Thank you for the question. So, I think certainly we've seen the real impact, right, of a TKI combination with a checkpoint inhibitor in RCC, and, you know, we've seen multiple examples of that. We've seen it with Velumab plus Axi, with Pembro plus Axi, and then Pembro with Lendema. Really some amazing results, and, of course, Cabo plus Nivolumab. So, the opportunity to add a third agent, you know, does still exist because there's still the need for better response rates, better durability, and further elevation of the tail of the curve. Now, all that said, you also have to balance all of these things.

In RCC and you know we've seen multiple examples of that we've seen it with a valid massless axiom Pembroke plus oxi, and then enbrel with bema.

Really some amazing results and of course, Cabo plus all of the map.

So the opportunity to add a third agent you.

You know it does still exist because there's still the need for better response rates better durability and further elevation of the tail of the curve.

Now all that said you know you have to also balance all of these things are the RCC landscape is is crowded and there are a lot of development going on and then of course, you also have to pay attention to not overly increasing any of the toxicity. When you start combining three drugs together.

Jonathan Zalevsky: The RCC landscape is crowded, and there are a lot of developments going on. And then, of course, you also have to pay attention to not overtly increasing any of the toxicity when you start combining three drugs together. So, we're very excited about the opportunity with BEMPEC plus nivolumab and the TKI, and so is BMS, which is why this is a really important part of our development program. And so, that clinical trial is well underway.

But we're very excited about the opportunity with the impact plus the volume had them at Teekay I and as it would be that much which is why this is a really important part of our development program.

And so that clinical trial is well underway its recruiting patients and we think there's a real opportunity in that setting, but the other part of your question. I think is also very very provocative because we know that there is an ongoing study around the corner, it's being run leap study with <unk>.

Jonathan Zalevsky: It's recruiting patients, and we think there's a real opportunity in that setting. The other part of your question, I think, is also very, very provocative, because we know that there's an ongoing study around the corner that's being run, a LEAP study with Pembro plus lenvima in non-small cell lung cancer. And this one's really focusing on the greater than 1% population added onto nivolumab. And so again, that would be a very interesting trial readout. It's expected likely in the early to mid part of the next year.

Pembroke plus on bema, and non small cell lung cancer.

This one is really focusing on the greater than 1% population added onto Nevada map and so again that would be a very interesting trial read out from it.

Expected likely in the.

Early to mid part of next year.

Jonathan Zalevsky: And as that has the potential of impacting the standard of care in small cell lung cancer, again, it would be an opportunity for a triplet combination, again, with the potential of that impacting even that doublet as well. Super helpful. Thanks for taking the question.

As that has the potential of impacting the standard of care in non small cell lung cancer again, it would be an opportunity for a triple combination again with the potential of that an impact even to that doublet as well.

Super helpful. Thanks for taking the question.

Yes.

Thank you.

Operator: Our next question comes from Jessica Fye from J.P. Morgan. Your line is open.

Next question comes from Jessica Fye from J P. Morgan Your line is open.

Operator: Hey, guys. Good evening. Thanks for taking my questions. I have a few on Benpeg, first on melanoma, and then a couple on lung. So you talked about the time to potential first data in that first-line melanoma study around year-end or early 2022, and I want to confirm whether that's based on the ORR interim, or is that a PFS study?

Hey, guys. Good evening, Thanks for taking my questions I have a few on been pegged first non online and then a couple on long. So you talked about the time to potential first data in that first line melanoma study around year end or early 2022, and I want to confirm whether that's based on the or our interim or is that a P. F.

Operator: Transcripts provided by Transcription Outsourcing, LLC.

That's read out that youre, referring to and if it is or are then when do you expect the PFS results from that study to read out.

Operator: Are, then when do you expect the PFS results from that study to come out?

Oh, Hi, Jonathan This is Jennifer I'll take this and see if David wants to add anything, but BMS is actually running the melanoma studies, though we do have two endpoints or are in PFS that will read out first based on the original.

Jennifer Ruddock: So, hi Jess. This is Jennifer. I'll take this and see if Jay-Z wants to add anything.

Jennifer Ruddock: But BMS is actually running the melanoma study, so we do have two endpoints, ORR and PFS, that we'll read out first. Based on the original design of the study, those two endpoints were separated by between four to six months. We have not decided with BMS yet how we'll be disclosing the data, but I think the best guide is probably to look at other companies that they've had studies with in terms of their disclosures and how they disclose data. For example, the Checkmate 9 ER study was disclosed in a press release. So, again, BMS is running the study, and we'll be working closely with them on the disclosures around both by independent

Original design of the study those two end points were separated by between four to six months.

We have not decided with the M S. Yet how we'll be disclosing the data, but I think the best guide is probably to look at other companies that they've had studies running with them in terms of their disclosures and how they disclose data on for example, the checkmate 90, our study was disclosed in our press.

So again BMS is running the study and we'll be working closely with them on the disclosures around it but I don't think any decisions have been made yet on that but the original design life.

Our our then PFS and both hurt by independent review.

Okay.

Operator: Okay, and then on one, what do you expect the average number of scans to be per patient in the ProPEL study by the time that it's presented? I know you talked about the patients all having a minimum of two scans, but I'm asking what the average number of scans you expect by then will be.

And then one.

What do you expect the average number of scan to be per patient in the propel study by the time that it's presented.

And then you talked about the patients all having a minimum of two scans, but I'm asking what the average number ex can't do you expect by that won't be.

Okay.

That's J D do you want to.

Operator: J.C., do you want to? I'd address this in terms of the level of maturity. Yeah, I mean, with our intention, you know...

I had a dresser in terms of the level of maturity.

Yeah, I mean, so what our intention you know Jessica to present mature data.

Jonathan Zalevsky: Yeah, I mean, our intention, you know, Jessica, is to present mature data. And so, because the study began in the middle part of last year, some patients have been in the study longer than others. And then, of course, you know, we scan at approximately nine-week intervals. And so, our intention is that the minimum amount of data is two patients per scan. And again, the goal is to just really present rich and interpretable data.

And so because the study began in the middle part of last year. So some patients have been in the study longer than others.

And then of course, you know we scan on approximately nine week interval and so our intention is that the minimum.

Amount of data.

Two patients per scan and again the goal is to just really present, a rich and interpretable data set.

Operator: And our next question comes from Defe Yang from Mizuho. Your line is open.

Got it.

Thank you.

And our next question comes from the FAA Yang from Mizuho. Your line is open.

Operator: Hey, good afternoon, guys. This is Alex from DFAY.

Hey, Good afternoon, guys. This is Alex on for day say, thanks for taking the question.

Operator: Thanks for taking the question. Another question on the long data here that's coming up in the second half. You talked a little bit about the sort of benchmarks with Pembroke alone and kind of the ORR rates in the different PD-L1 expressors. Can you talk a little bit about what you would consider as promising in terms of the delta in response rates versus Pembroke alone that you'd like to see and, you know, that would... that you would take forward? And also, along with that, will the decision to move forward or not be a joint decision made by Merck and Nektar?

Another question on the long data here, that's coming up in the second half you talked a little bit about the sort of benchmarks with timbral alone and kind of the overall rates.

And the different PD lone expresses.

Can we talk a little bit about what you would consider is promising in terms of the delta in response rates versus pan-broil alone that you'd like to see and you know that would.

That you would take forward.

And then also along with that with the decision to move forward or not be a joint decision made by Merck and Nektar together.

Thanks, Alex that J D do you want to.

Operator: Thanks, Alex. Jay-Z, do you want to?

Operator: Sure. Yeah, yeah, absolutely. Those are good questions.

Sure Yeah, Yeah, absolutely those are good questions and so as I mentioned the benchmarks.

Jonathan Zalevsky: And so, as I mentioned, the benchmarks that we talked about for single-agent pembrolizumab. And so, the study does have some statistical considerations built into it, such as the Fleming criteria that we talked about before. So, there are some kind of Fleming guidelines, right, that are incorporated into the trial. But another way that you could think about it, Alex, is just in ways that are meaningfully sort of different from those benchmarks.

We talked about for single agent remember, there's a map.

So the study does have some you know the statistical considerations built into it such as the plumbing criteria that we talked about before so there are some kind of Fleming guidelines right that are incorporated into the trial, but another way that you could think about it Alex is just ways that are are are meaningfully.

<unk> sort of different right there and then those benchmarks. So for example, if you consider the 149 subgroup and then you also consider the mechanism of action of Bam pegged to essentially transform the tumor microenvironment to look like a tumor that's like greater than 50.

Jonathan Zalevsky: So, for example, if you consider the one to 49, and then you also consider the mechanism of action of BEMPEG to essentially transform the tumor microenvironment to look like a tumor that's like greater than 50, you know, in its kind of PD-L1 status, its interferon, gene expression, the amount of CD8 infiltrates, and other things like that. You know, you could really transform that tumor to increase the efficacy of the combination.

You know and it's kind of PDL one status it's interferon.

Gene expression the amount of CD, eight infiltrates and other things like that.

We you could really transform that tumor to increase the efficacy of the combination. So when we look at those benchmarks.

Jonathan Zalevsky: So when we look at those benchmarks, you know, we look at things like doubling, for example, or more of the response rate in the less than 1%, for example, tripling it, so in the 20s, mid-20s, relative to an 8% historical response rate in the less than 1%. Those are the kinds of ranges that we're looking at. And then we also look at the whole totality of the data as well, right? We'll look at durability of the responses, and we'll look at time to event, you know, like progression and other kinds of components as well.

If we look at things like doubling for example are more of the response rate and the less than one per cent for example, tripling it from Twenty's mid twenty's relative to an 8% historical in the less than 1%. Those are the kinds of ranges that we're looking at and then you also look at the whole totality of the data as well right.

The durability of responses and we will look at time to event, you know like progression other kinds of components as well.

In terms of a decision to go to phase III remember that we're running the propel study on our own we're.

Jonathan Zalevsky: In terms of a decision to go to phase 3, remember that we're running the PROPEL study on our own. We're not collaborating with Merck on that trial. And so any decision to move forward to phase 3 will be based on the actionability of that data from PROPEL, and that will be our decision, Nektar.

We're not right collaborating with Merck on that trial and so any decision to move forward to phase III will be based on the action ability of that data from propel and that'll be our decision vector to me.

Great. Thank you.

Operator: Our next question comes from Ben Burnett from CFO. Your line is open.

Okay.

Thank you.

Our next question comes from Ben Burnett from Stifel. Your line is open.

Operator: Fantastic. Just a quick one for me, regarding the PROPEL study and the cohort with chemo being added to the doublet, I guess, what flexibility do you have around the dose of Benpeg? And are you dose ranging here, or have you already settled on the specific dose of Benpeg? Yeah, those are really good questions.

Fantastic just just a quick one from me regarding the propel study and in the cohort with chemo being added to the doublet I guess, what flexibility do you have around the the dose have been taken or are your dose ranging here or have you already settled on a specific dose of impact.

Yeah, those are really good questions.

Jonathan Zalevsky: And so we actually have the flexibility to evaluate doses, different doses of BEMPEG in the PROPEL study, as you know. And that includes both a dose optimization component that we're running with just the doublet in a range of different tumor types. And so with chemotherapy, we also have the opportunity to explore different dose levels of BEMPEG, but it's really only as needed. You know, I mean, we feel very confident in the dose that we can combine BEMPEG plus PEMBRO with chemo.

So we actually have the flexibility to evaluate doses different doses a backpack.

In the propel study as you know so that includes both a dose optimization component, though we're running with just the doublet in a range of different tumor types.

And so with chemotherapy, we also have the opportunity to explore.

Different dose levels of <unk>, but it it's really as needed you know I mean, we feel very confident in the dose. So we can combine with genpact plus kimbro with the chemo.

Operator: Thank you. And again, ladies and gentlemen, to ask a question, please press star and then one now. And our next question comes from Daina Graybosch from SVB Lyrinc. Your line is open.

Okay, great. Thank you.

Thank you and again, ladies and gentlemen to ask a question. Please press star and then one now.

And our next question comes from Dana <unk> from SVP Leerink. Your line is open.

Operator: Hi. Thanks for the question.

Alright. Thanks for the question we had some recent interesting oded on accelerated approval of a checkpoint.

Operator: We had some recent interesting ODACs on accelerated approval of checkpoints, two on bladder cancer, and I thought there were two points that were relevant to your plan for BENTEG and bladder cancer. One, there was discussion that the Abelimab approval as a first-line maintenance therapy for platinum-sensitive patients narrows the unmet need for accelerated approval potentially to platinum-ineligible patients from cis-platinum-ineligible. And the second, across all the ODAC conversations, was the discomfort from the FDA about using early-stage checkpoint studies to confirm metastatic accelerated approval, and I wonder if you have any thoughts or any implications for your accelerated approval strategy in bladder cancer.

Two on bladder cancer and I thought there were two points are irrelevant to your to your plans for been taken bladder. One there was discussion that the avella mab approval as a first line maintenance.

And then sensitive patient narrows, the unmet need for accelerated approval potentially from the platinum ineligible from cisplatin ineligible and a second across all the.

Conversation, whereas the discomfort from the FDA about using early stage checkpoint studies to confirm metastatic accelerated approval and I Wonder if you have any thoughts or any implications potentially on your accelerated approval strategy and bladder cancer.

Thank you Dana J D. I'll ask you to take a stab at that one. Thank you sure no absolutely. Thanks day no further question of you.

Operator: Thank you, Daina. Jay-Z, I'll ask you to take a stab at that one.

Operator: Thank you. Sure. No, absolutely not.

Jonathan Zalevsky: Thanks, Daina, for the question. You know, those sets of ODAC committee meetings over several days were very, you know, interesting, right, to our entire community. We watched them very closely across all the different tumor types. And certainly, all of the points that you make were points that were, you know, discussed.

You know that that's an <unk> committee meetings over several days, where we're very interesting right to our our entire community we watch them very closely.

It is across all the different tumor types, so and certainly all of the points that you make ware points. There were you know were discussed and we'll have to see sort of how the end result of the O DAC and the final interpretation of the Fda's opinion on the things that they specifically didn't vote for but that could.

Jonathan Zalevsky: And we'll have to see sort of how the end result of the ODAC and the final interpretation, right, of the FDA's opinion on the things that they specifically didn't vote for, but that could impact, you know, us in this case. So certainly, on the first point, the unmet need could be different with the recent approval that you mentioned. And one of the things that we always deal with whenever we're attempting an accelerated approval is that you're really judged on the totality of the data against the available standard of care at the time.

Impact us in this case, so certainly on the first point.

The unmet need could be different with the recent approval.

You mentioned and one of the things that we always deal with whenever we're attempting an accelerated approval is that you're really judged on the totality of the data against the available standard of care at the time.

Jonathan Zalevsky: And so even though that has changed since the time that we started the study, you know, that will still be the situation that we'll be moving into. And so our key point, right, is to provide the best possible data set in PIVOT-10, showing very long durability of response, showing very good ORR, you know, ideally with a CR rate, the kind that we saw in PIVOT-02 when we treated the same patient populations.

And so even though that has changed since the time that we started the study you know that will still be the the situation that will be moving into and so our key point right is to provide the best possible dataset from pivot 10, showing very long durability of response.

Going very good O R R.

Ideally with a CR rate the kind that we saw in pivotal too when we treated the same patient populations.

Jonathan Zalevsky: And then that's well balanced, you know, with a very acceptable safety profile so that there is a very reasonable risk benefit profile for the FDA to make a potential accelerated approval decision. Now, to the next part. I think one of the real eye-opening things about that ODAC was the overall success of confirmatory studies in general over accelerated approvals. And if you even dissect that from solid tumors versus liquid tumors, I mean, it's an even greater kind of situation.

And then that's well balanced.

A very acceptable safety profile, so that theres, a very reasonable risk benefit profile for the FDA to make a potential accelerated approval decision.

Now to the next part I think one of the real eye opening things about that Oh, DAC was kind of the the overall success of <unk>.

Confirmatory studies in general over accelerated approvals.

And if you even dissect that from solid tumor versus liquid tumors. I mean is it didn't even even even greater kind of situation.

Jonathan Zalevsky: So, I do think that the FDA's position on these things might potentially, you know, be impacted, which was the nature of all of those ODAC meetings. But for now, we're really just going to have to wait and see and determine how exactly it would impact us. Thanks for the provocative questions.

So I do think that the fda's position on these things that might potentially.

Be impacted which was the nature of all of those meetings.

But for now we're really just gonna have to wait and see and determine how exactly it would impact us if at all.

Thanks for the provide how question.

Yeah.

Operator: Thank you. And our next question comes from Arlinda Lee from Canaccord. Your line is open.

Thank you.

And our next question comes from Arlinda Lee from Canaccord. Your line is open.

Operator: Hi guys, thanks for taking my questions. On two by five, can you talk about the, I know you've answered some of this before, but on the two scans, so that means if the interval's at least two weeks, then it's going to be essentially if somebody's responded early, that they would be a confirmed response, and then that duration would be at least nine weeks. I'm wondering roughly how many patients you think might be at that point. And then, secondly, I was curious about your earlier stage stuff on the other side.

Hi, guys. Thanks for taking my questions.

On <unk> can you talk about the.

I know you've answered some of this before but on the two scan so that that means it's.

If the intervals at least two weeks then it's going to be essentially somebody's responded early that they would be a confirmed response and then that duration would be at least nine week I'm I'm wondering roughly how many patients do you think might be at that point and then secondly, I'm just curious about your earlier.

Stage huh.

Hum.

On other cytokines and platforms beyond polymer chemistries with what kinds of things would you find interesting and.

Operator: may be additive or complementary to what you have now.

Maybe how it came from a complementary to what you have now thank you.

Jonathan Zalevsky: Thank you, Arlinda. Jay-Z, do you want to talk through the 255 data points that we're expecting to study? Yeah, I'm not entirely sure I understood the question on it, but in 255, you know, we're evaluating patients with either heme or solid tumors. And then depending on the nature of the heme malignancy, such as NHL or multiple myeloma, they're evaluated differently, right? Like we'll use Lugano criteria for the NHL patients and, you know, the myeloma working group criteria for evaluating patients with multiple myelomas.

Thank you our arlinda J D. Do you want to talk through the two five fives data that yeah, you're studies, yeah. So yeah.

I'm not entirely sure I understood. The question Arlinda, but in and 255, you know we're evaluating patient.

Patients in either team or in solid tumor and then depending on the nature.

The the heme malignancy, such as NHL or multiple myeloma, there are evaluated differently right like we use lugano criteria for the NHL patients in the the myeloma working group criteria for evaluating patients with multiple myeloma.

Jonathan Zalevsky: And then focus on more of a resist, you know, kind of effect in the solid tumor setting. But, you know, we're very excited with the data that we're seeing from the 255 studies, but both of them, we're able to dose escalate very effectively. We're seeing all of the cellular population changes that we expect to see, and we're seeing both systemic as well as local changes that we're observing in patients treated with Nektar 255.

And then focus on more of a assist you know kind of a.

In fact in the solid tumor setting.

But you know we're very.

Excited with the data that we're seeing from the $2 55 studies that both of them.

We're able to dose escalate very effectively we're seeing all of the cellular population changes that we expect to see.

And we're seeing both systemic as well as local effects.

That we're observing in patients treated with an extra $2 55 to me also one of the most interesting and I think really profound things is that remember in a lot of the patients that we've been treating with multiple myeloma, there really advanced to the point that they have significant bone marrow.

Jonathan Zalevsky: To me, also, one of the most interesting and I think really profound things is that, remember, in a lot of the patients that we've been treating with multiple myeloma, they're really advanced to the point that they have significant bone marrow function and damage.

Dysfunction and damage.

Jonathan Zalevsky: And many of these patients actually have a whole range of cellular deficiencies, you know, already as a result of the advanced multiple myeloma eroding the bone marrow in these patients. And even in patients that have compromised marrow, Q55 is still able to elevate NK cells and CD8 T cells, you know, inducing output, even in the face of such advanced disease. So we think those are extremely encouraging signs that we are seeing with our IL-15 program agonists.

And many of these patients actually have a whole range of cellular deficiencies already as a result of the advance multiple myeloma eroding the bone marrow and the patients and even in patients that have compromised Mero 255 is still able to elevate NK cells and CDA T cells.

Inducing output and even in the face of such advanced disease. So we think those are extremely encouraging signs I'm seeing with our IL 15 program agonists and we're very excited to not just continue with these ongoing studies, but also to present some of that data in the second half of this year.

Jonathan Zalevsky: And we're very excited to not just continue with these ongoing studies but also to present some of that data in the second half of this year. Now, in terms of some of the things we're doing in research and discovery, so one of the things that I mentioned earlier is that earlier this year, we announced a discovery collaboration with a company called Biologic Design, and they're a company that specializes in very unique antibody engineering.

Now in terms of some of the things we're doing in research and discovery.

So one of the things that I mentioned earlier is we earlier this year, we announced a discovery collaboration with with Uh Huh.

A company called biologic design and they are a company that specializes in a very unique.

Antibody engineering.

Jonathan Zalevsky: They actually use a computational approach. It's an AI-guided protein engineering approach, and I have had a lot of, you know, fun times working with antibodies, and the kind of protein engineering that Biologic uses is really compelling. So we're working with them in order to target very important immunological targets, and we're using an antibody approach to address them. So this is one example of using a totally different modality. And we have additional uses that we're also exploring.

They actually use a computational approach, it's an AI guided.

Our protein engineering approach.

Have a lot of a lot of Uh huh.

Fun times, working with antibodies in a kind of protein engineering debt by licensed users really compelling.

So we're working with them in order to target.

Important immunological targets and we're using an antibody approach to address them. So this is one example of using a totally different modality.

And we have additional uses that we're also exploring some of them involve a combination of various chemical modifications to proteins additional chemical modifications to polymers non peg based polymers as well that we can use to change both the geometry of proteins as.

Jonathan Zalevsky: Some of them involve a combination of various chemical modifications to proteins, additional chemical modifications to polymers, and non-PEG-based polymers as well that we can use to change both the geometry of proteins as well as the kind of multimeric state of proteins to induce different kinds of signaling. These are all the kinds of things that we do in the chemistry labs and in our basic research. Facility, and I'm excited as those things move forward with the additional INDs to come in the future.

Well as the.

Kind of multi America state proteins to induce different kinds of signaling.

These are all the kinds of things that we're doing in the chemistry labs and in our basic research.

Facility and I'm excited as those things moving forward with the additional <unk> to come in the future as well.

Operator: Thank you. And that does conclude our question and answer session for today's conference, and I would like to turn the call back over to Howard Robin for any closing remarks.

Thank you.

And that does conclude our question and answer session for today's conference I'd now like to turn the call back over to Howard Robin for any closing remarks.

Howard W. Robin: Well, thank you, everyone, for joining us today. And I'd like to thank our employees for their continued dedication and consistent efforts during these very, very challenging times. Their dedication to advancing our clinical studies while keeping our business on track is impressive, and we're very grateful for their contributions. As I stated earlier, we are well-positioned. We have a strong balance sheet and an important portfolio of immuno-oncology and immunology programs, many of which are the most advanced in their fields.

Yeah.

Well. Thank you everyone for joining us today and I'd like to thank our employees for their continued dedication and consistent efforts. During these very very challenging times and their dedication to advancing our clinical studies, while keeping our business on track is impressive and we're very grateful for their contributions and as I stated earlier, we are well positioned.

<unk> with a strong balance sheet and an important portfolio of immuno oncology and immunology programs many of which are the most advanced in their field and.

Howard W. Robin: And we thank our shareholders for their ongoing support and look forward to continuing to provide you with updates on our programs. And we hope that you and your families continue to stay safe and healthy. So thank you very much. I appreciate it.

And we thank our shareholders for their ongoing support and look forward to continuing to provide you with updates on our programs and we hope that you and your families continue to stay safe and healthy. So thank you very much appreciate it.

Operator: This concludes today's conference call. Thank you for your participation, and you may now disconnect. Everyone have a wonderful day.

This concludes today's conference call. Thank you for your participation and you may now disconnect everyone have a wonderful day.

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