Q2 2023 MacroGenics Inc Earnings Call

Okay.

Good afternoon.

We will begin the Macrogenics 2023 second quarter corporate progress and financial results conference call in just a moment.

All participants are in listen only mode at the moment and we will conduct a question answer session at the conclusion of the call.

At this point I will turn the call over to Jim Carroll Senior Vice President Chief Financial Officer of Macrogenics.

Yeah.

Thank you operator, good afternoon, and welcome to Macrogenics conference call to discuss our second quarter 2023 financial and operational results.

For anyone who has not had the chance to review these results.

We should have a press release this afternoon outlining todays announcements, which is available under the investors tab on our website at Macrogenics Dot com.

You May also listen to this conference call via webcast on our website, where it will be archived for 30 days beginning approximately two hours after the call completed.

I would like to alert listeners that todays discussion will include statements about the company's future expectations plans and prospects that constitute forward looking statements for purposes of the safe Harbor provision under the private Securities Litigation Reform Act of 1995.

Actual results may differ materially from those indicated by these forward looking statements as a result of various important factors, including those discussed in the risk factors section of our annual quarterly and current reports filed with the SEC.

In addition, any forward looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date, while we may elect to update these forward looking statements at some point in the future. We specifically disclaim any obligation to do so even if our views change except to the extent required by applicable law.

And now I'd like to turn the call over to Doctor, Scott <unk>, President and Chief Executive Officer of Macrogenics.

Thank you Jim I'd like to welcome everyone participating via conference call and webcast today.

This afternoon, I will provide key updates on our clinical programs.

Before I do so let me first turn the call back to Jim who will review our financial results.

Thank you Scott This afternoon Macrogenics reported financial results for the quarter ended June 32023, which highlight our financial position.

As described in our release this afternoon Macrogenics total revenue was $13 $1 million for the quarter ended June 32023, compared to total revenue of $26 million for the quarter ended June 32022 revenue for the quarter ended June 32023 included recognition of one $6 million and contract Manny.

Factoring revenue and margin and net sales of $5 1 million compared to net sales of $4 $7 million for the quarter ended June 32022.

Our research and development expenses were $43 2 million for the quarter ended June 32023, compared to $51 $7 million for the quarter ended June 32022.

The decrease was primarily due to decreased costs related to discontinued studies, partially offset by increased expenses related to preclinical antibody drug conjugate or ADC molecule and increased clinical expenses related to large ela map and Barbara duo.

Our selling general and administrative expenses were $13 $7 million for each of the quarters ended June 32023 and 2022.

Youll notice approximately $100 million as a component of other income on our income statement, let me take a moment to explain under GAAP guidelines and pursuant to FASB ASC 478 at March 2023, we recorded the $100 million proceeds received from the sale of our royalty interest on global net.

Sales of Tcl to Deride health care acquisitions L. P or <unk> is a quote liability related to future royalties unquote. This liability was to be amortized over the term of the arrangement using the effective interest rate method.

Sandeep you subsequently acquired.

Both prevention bio and the Tcl royalty interest in milestone obligations from tier I and April 27 2023.

Obviating the need for Macrogenics involvement in the transfer of royalty payments to <unk>. This.

This resulted in a change to the arrangement, which was evaluated as a modification of the provisions of ASC 470, Accordingly, we recognized approximately $100 million. There's a component of other income on our financial statements for the quarter ended June 32023.

Our net income was $57 $5 million for the quarter ended June 32023, compared to a net loss of $41 3 million for the quarter ended June 32022.

Our cash cash equivalents in marketable securities balance as of June 32023, with $243 million compared to $154 3 million as of December 31, 2022.

Our cash balance as of June 32023 did not include a $50 million milestone payment from canopy. Subsequently earned payment of this milestone was triggered pursuant to Santa Fe is July 28 announcement that the protect placebo controlled study investigating <unk> <unk> in patients with newly diagnosed stage three.

<unk> type one diabetes met its primary endpoint, having demonstrated preservation of beta cell function. This milestone was part of the March 2023 agreement originally between Macrogenics <unk>, the royalty interest and milestone payment obligations of which were sold by DIY to a subsidiary of Santa Fe in April 2023.

And finally in terms of our cash runway, we anticipate that our cash cash equivalents and marketable securities balance of $243 million.

As of June 32023 that $50 million milestone subsequently earned in addition to projected and anticipated future payments from partners and product revenues should extend our cash runway into 2026 are anticipated funding requirements reflect expect expected expenditures related to the phase II Tam.

<unk> clinical trial, the phase II study of <unk> in metastatic castration resistant prostate cancer as well as our other clinical and preclinical studies currently ongoing and now I will turn the call back to Scott.

Thank you Jim we continue to believe our proprietary pipeline of product candidates has great promise.

Walk you through each of our key programs momentarily as well as tell you about our plans for upcoming clinical programs, but before I do that I'll quickly remind you that over the past year through our business development efforts as well as milestone achievement, we have generated $320 million of NAV.

Non dilutive capital.

Well were minimized due or compazine or vulgar duo is our ADC designed to deliver DNA alkylating dorko myosin cytotoxic payload to tumors.

Expressing <unk> III.

These msas III as a member of the <unk> family of molecules involved in immune regulation.

But we do always designed to take advantage of this antigens broad expression across multiple solid tumor types.

We began enrolling the tamarac phase II study of overdue in patients with metastatic castration resistant prostate cancer under a modified study protocol during the second quarter.

You may recall that we made this modification to address the changing treatment landscape for patients with Ms. CRP C and enrollment has been proceeding nicely.

We hope to enroll the majority of the 100 patients across the two experimental arms.

Student expert Kid or $2 seven mix per kg every four weeks in 2023 and provide a clinical update in 2024.

Next I'll update you on Lora Geralyn that our Bispecific tetravalent PD, one by <unk> Dart molecule.

We designed large Alan that preferential blockade undue PD, one <unk> four expressing cells, such as tumor infiltrating lymphocytes or til, which are most abundant in the tumor micro environment.

You may recall that we presented encouraging preliminary clinical results from our single arm dose expansion study of large allomap in patients with advanced solid tumors in a poster session at the <unk> General urinary cancers Symposium in February 2023.

Based on the strength of BMC RPC data presented we plan to commence enrollment of our randomized phase II study of Lora Journal and that in combination with Docetaxel versus Docetaxel alone in second line chemotherapy naive and CRP C patients in the coming weeks.

A total of 150 patients are planned to be treated in the two to one randomized study.

The current study design includes the primary study end points radiographic progression free survival.

In addition, we continue to enroll patients in the phase one dose escalation study of Volcker duo and combination with large allomap in patients with advanced solid tumors, including renal cell carcinoma pancreatic cancer ovarian cancer the past cellular carcinoma.

<unk> in melanoma.

We anticipate commencing the dose expansion portion of the study by year end 2023.

Next up <unk>.

<unk> <unk> 24 is our next generation bi specific CD 123 by CD three dart molecule that incorporates a CD three component designed to minimize cytokine release syndrome, or maintaining antitumor side Olympic activity and permitting intermittent dosing through a longer half lives.

Our phase one dose escalation study of <unk> <unk> 24 is ongoing in patients with CD 123 positive relapsed or refractory hematologic malignancies.

Including acute myeloid leukemia and Myelodysplastic syndromes.

Recall that Gilead has the option to license <unk> 24, a predefined decision points during the phase one study.

Finally, another season that is an FC optimized monoclonal antibody that targets <unk> 780, <unk> III.

Based on the recently published results from our Phase II investigator sponsored study of <unk> in men with prostate cancer.

<unk> and collaborators at multiple academic institutions plan to initiate an investigator sponsored randomized translational Lee intense neo adjuvant prostate cancer study in high risk population by early 2024.

And now I'd like to give you some perspective on where macrogenics intends to advance.

I'll remind you that over our history, we have maintained our focus in developing innovative antibody based therapeutics.

Having had a role in the development of three products now approved by the U S. FDA.

Mark gender Tcl and designers.

More recently as an extension of this emphasis we've accelerated our ADC efforts.

This has been possible through the following first our technology, enabling partnerships.

Most notably our two collaborations with Synaptics, which has recently been purchased by ladder.

We have reviewed multiple linker payload technologies and are pursuing synaptics is approach, which utilizes various linker toxin conjugate it to a site specific or I can within the FC domain of antibodies.

This affords us the ability to exploit.

Different cytotoxic mechanisms, including telco I summarized inhibition microtubule inhibition and DNA damage and up to 7% ADC molecules incorporating synaptics is technology.

The second element, we believe allows us to extend our reach into Adcs is leveraging our 20 plus year history of pursuing first in class target discovery. In addition to our antibody engineering expertise.

And finally, the third element is our proven ability to develop product candidates through FDA approval, coupled with our commercial scale manufacturing and external supply chain management capabilities.

We are very excited about where this could take us in developing adcs to treat cancer.

As previously indicated we intend to submit an investigational new drug or IND application to the U S. FDA by the end of this year for the first of potentially multiple new ADC molecules, which incorporate topoisomerase inhibitor payload.

To conclude we believe we have the technical development and clinical expertise and even the necessary financial resources to support execution on our plan of developing and delivering life changing medicines to cancer patients in 2023 and beyond.

We would now be happy to open the call for questions operator.

Thank you could you would like to ask a question. Please press star one one if your question has been answered and you'd like to remove yourself from the queue. Please press star one again.

Our first question comes from Jonathan Chang with Leerink Partners. Your line is open.

Hi, guys. Thanks for taking my questions. First question can you give us a sense of how enrollment in the phase II <unk> study has progressed.

To get a sense of when in 2024, we might see data.

Thank you Jonathan.

Very encouraged by the rapidity of.

Enrollment at this point now as.

Many of these sites have incorporated the amendments to the protocol.

We still have additional site initiation visits.

To complete.

An additional sites but.

Based on what we've been seeing.

And this group of upsides.

I stick with what I have said that the majority of patients.

Should be enrolled in the study this year and we should complete it.

And the first part of 2024.

Got it thank you.

Question, what do you need to see from the either the phase II prostate cancer studies.

Advancing these programs into the next stage of development.

So with regard to tamarac as you know we had seen very encouraging data.

With regard to late stage <unk> patients with regard to PFS.

A 50 reductions as well as objective responses.

The goal of this study.

In fact is to achieve.

Our responses.

Or is it efficacy.

We're <unk>.

Similar to that observed at the doses that we had treated before as you recall III expert CAGR Q3 weekly basis.

But which most of those patients had dose reductions during those cars.

What is more important.

At this point.

Is to see.

Some improvement in the side effect profile in particular.

The most disconcerting side.

Side effect was hand foot syndrome in these patients who develop great too with pain. So we would like to see a reduction obviously in that grade and obviously the incidents as well with regard to the efficacy.

Parameters.

Again, just to refresh everybody's memory, we saw approximately half those patients.

PSA 50 reductions.

Of course, we would like to see.

The order around the 40% to 60%.

Or even better obviously if that is achievable.

In that population with the concomitant.

Tumor control and continued treatment.

With regard to the large <unk>.

Study.

In terms of.

The outcomes, obviously, we were looking for a very acceptable safety profile in terms of efficacy.

If you look at the historical data in terms of control groups, which obviously include year of patients treating with Docetaxel.

Historical data says in our PFS of eight months.

Is what you would like to exceed so we'll have to see if we're able to achieve that by certainly several months.

Yeah.

Got it thanks for taking my questions.

Yes.

Thank you. Our next question comes from Peter Lawson with Barclays. Your line is open.

Thanks, Scott I guess initially just as a follow up to Jonathan's question.

The.

Data that we could see for your piece of an H three.

Phase III.

The phase II data can we see that in the second half of 'twenty four phase one combination data.

Is that something like a first curve plentiful datasets go.

So Peter as as things go now as I said to Jonathan.

And the encouragement about where we are enrolling and if this continues at this pace I think the second half 'twenty four.

Presentation of.

This data is certainly possible for the Tamarac studies. So obviously, we'll have to monitor that the rest of the year in terms of enrollment.

Should also point out that this is an open study so we will take.

Interim looks at that data along the way and may be able to come to some conclusions.

Earlier before we even have the full body of data from that study so.

Again, I would be consistent with the targeting the second half of the year.

At this point with regard to the combination study as we pointed out we're sort of trying to fine tune.

The combination of Bob Rowe with Laura <unk> Bad right now individually in combination.

Once we settle on what that dose.

So use the doses to use moving forward in combination and expansion studies.

We expect that to occur by the end of the year. So again.

Could it be the first half the year possible, but right now.

Let me.

Bring you up to date once we have picked that those doses and started those expansions will be able to give you a little bit more.

Finish and when that will happen.

Richard Thank you and then.

Yes.

And update this year kind of what kind of uptake because that people receive data is kind of a go no go decision.

With the teacher and both the lung cancer.

So.

As you know and.

And we discussed this at the for Immunogen is conducting clinical studies.

Following through on the patients with lung cancer to identify an appropriate dose making decisions about go forward, we have not discussed with them.

Specifics about what would be discussed and presented.

We should be doing that soon so again.

Updates later this year the nature of what will be contained.

I have an answer to you at this time.

Great. Okay. Thanks, so much.

Thank you.

Our next question comes from Charles <unk> with Guggenheim. Your line is open.

Hi, guys. This is rosy on for Charles Thanks for taking our questions. So first question is with regard to the changing landscape.

CRB.

How are you changing are selling applications with regards to the belt with Sangamo Vertigo and larger amount next I would like to put Mcdowell.

So.

If I understand your question how are we.

Anticipating the use of these drugs in face of where predictor is at this point in the future is that is that correct, yes. Okay.

Clearly.

So there is.

Is.

It has changed the landscape for treatment.

Being.

Used.

Currently right now in major medical centers that have.

Pet scanning capabilities for PFS at May.

There has been as you know.

Some limitation.

<unk>.

Distribution in terms of supply, which is being addressed by novartis.

So there will be increased use.

With time.

I think that at this point.

Well, we have to wait.

To see the data on the results of that.

In earlier lines of therapy, so right.

Right now it's more in a later line of therapy.

When we have completed our study results we will.

What were the appropriate a line of therapy will be which populations, but right now it's just too early.

Also mechanistically.

We're talking about completely different mechanisms.

And also the toxicity profiles are quite different and so I think that.

This is an opportunity where different mechanisms of action.

A greater number of choices for treating physicians and their patients. So I think it's a good story for patients.

That new.

New modalities will be available very very soon.

Thank you and if I can ask a second one real quick.

Doug over to you all.

Others listen the histology.

The dose expansion.

Well as we pointed out in today's call and previously we are looking at six different solid tumor types right now we have not selected which ones to do.

For the expansion.

Certainly.

Prostate cancer will be one of them.

Which additional others, we will select.

We have yet to make that decision and then again in the near term, we'll be able to provide that information.

Okay.

Okay.

Thank you. Our next question comes from <unk> <unk> with BMO capital markets. Your line is open.

Great. Thanks for taking the question first one just wondered if you plan to disclose any of the data from the dose escalation. So vulgar a duo plus storage drilling prior to moving into expansion studies and then secondly, if you could maybe you could comment on the progress.

Are there any other kind of other tumor types, Laurie sort of mono therapy, maybe any progress there with other tumor types. When we could get an update there or any other tumor types that you would look to explore with floor either monotherapy or combination. Thank you.

Yes so.

We'll have to again as you know as I've said just earlier today.

Honing in on the Spa.

Specific doses for the individual components of the overdue combo.

Ultimately it will be determined how many.

Patients we have available at that time.

Two to assess.

My my inclination right now is too.

Start and.

Move forward and expansions.

Particular types, which I alluded to before prostate and probably one or two others.

And probably at that time.

Once we have that data we would be in <unk>.

I think a better position to present the total data.

But again this is subject to further discussions later this year with.

With regard to other tumor types of Lori Besides the data we presented at <unk> as you know we have previously said that we've had objective responses.

In three other cohorts that we were testing, including EMS stable colorectal cancer.

<unk> Mellon melanoma.

And our lung cancer.

What I've also indicated on previous calls is that for us to move forward in two or more.

Wholesome phase II study I'd like to see some additional patients being treated as monotherapy.

To get to.

To better.

Determine.

The activity in particular tumors.

I pointed out for example.

In the lung cancer cohort that we had we lost a lot of that data because of.

Patients that were treated in Ukraine for the case of the MF stable.

Colorectal cancer patients.

I pointed out we had very few patients.

Without.

Without liver metastasis, which has been an area.

Pursued by others, so I'd like to see additional patients being treated as monotherapy before making decisions going forward.

The melanoma data, we're very encouraged by as you know historically we've had.

As we have noted that we've had very.

Significant responses in <unk>.

With volcker duo in melanoma as well.

And that is one of the tumor types where potentially.

Enrolling in the combination study going forward so.

Great. Thank you.

Thank you. Our next question comes from Cavalry Polman with <unk>. Your line is open.

Yes. Good evening. Thank you thanks for the update and for taking my question.

Sorry, if I missed this.

For larger <unk> and Docetaxel combination study.

Randomized trial for 150 patients can you give us a sense on.

How long it will take to enroll the study and to get Rps that also do you think that you can just expand it to a phase III trial at the interim data looks good just wanted to know how you were thinking about it.

Yes.

Thank you very much so.

We're very close to enrolling the first patients we've initiated sites patients are being screened now.

So we're really on target for what we have said with regard to.

The startup of this trial right now until you start enrolling you won't know.

The rate of enrollment, but right now the anticipation.

It will take us through this year and through a good part of 'twenty four.

And so at this point it would be just too early to predict when we'd be able to do the readout at the site.

No.

Most likely in early 'twenty five.

But that's all conjecture at this point.

Got it that's very helpful.

And then for Mgd <unk> four can you tell us how is the enrollment going any feedback you have received from physicians. So far and can you accelerate those in based on your previous previous clinical experience that Florida is a montana.

So as you know and in irrespective.

What the product is any CD three base.

Bi specific molecule when interacting with the regulatory agencies.

There is a lot of prudence in terms of the dose escalation speed in which these things can be conducted despite the fact that.

We had very.

A significant data showing a dramatic reductions.

In cytokine production in Primate model systems, and anticipate that we could move this faster, but having said that we are following what was discussed with the FDA. We are right in the middle of a dose escalation study is going well.

And that's all I can say.

At this point my sense is is that once the dose has been picked from that dose escalation and we go into a.

More phase III like.

Study.

There may be greater opportunities to accelerate the development, but again that will be with either with gilead, if they opt into the into the program.

After the phase one or during phase one or by ourselves if it warrants it so.

It's still too early to tell.

Makes sense. Thank you.

Thank you. Our next question comes from Yigal <unk> with Citigroup. Your line is open.

Hi, Scott Thanks for taking the question.

On the Tamarac study in metastatic CRP C. And then the phase one dose escalation with the combo and I think you mentioned CRP C. There as well and you wanted to do an expansion can you just comment what are those patients those prostate patients relatively similar in their degree of pre treatment you mentioned it.

Solid tumors for <unk>. So it wasn't clear if it was similar or if the ones from the phase one two or more significantly.

Pretreated versus versus tamarac.

So there are some slight differences in eligibility, we have a little bit wider in tamarac.

But.

The majority of the patients will be quite similar so.

We obviously wanted to compare apples to apples with the modification of dose.

Obviously wanted to get this enrolled quickly so there was.

Some minor changes, but I would say.

There'll be very easily comparable to the previous data.

At the same story with the.

The combo for whatever prostate patients come in very late stage.

Patients as well typically.

Have advanced on the androgen receptor targeting agents on on.

A taxane and often.

Experimental agents as well so.

We think the data set will be.

We will be able to compare.

Each one so.

The reason I ask is because I mean, if you do the prostate expansion in the phase one two with the vote, Brian Gillian lab and that looks really good.

I'm, just curious how youre thinking about.

Pivotal study and how you would register the product because of.

Whether you would want to register with them with the monotherapy with a broker dealer or the larger lower drilling mab overdo. It looks really good in prostate if that would be the way to go forward.

To take the drug to Mark the combo to market that's more of a strategic question, but just curious how you're thinking about that.

Obviously this is constant discussion obviously.

With the data on the Lora Gerald <unk> Mono story.

Being so encouraging we decided.

To move a little bit up line with now going into chemo naive patients.

But with androgen.

Androgen receptor experienced patients.

<unk>.

So that right now there is there is no other checkpoint that is buying for that population. So this is a great opportunity where we can demonstrate.

And that line of therapy.

Success with regard to the Volcker story.

Either as monotherapy or potentially combination with Laurie.

That's a nice problem to have that both look.

Very successful both the results from Tamarac and then the combo. So we'll address that as.

The data comes out next year.

Thank you. Our next question comes from Stephen Willey with Stifel. Your line is open.

Yes, good afternoon, thanks for taking the questions.

I guess now that you've.

<unk> the control arm from.

Tamarac I'm guessing there's going to be more of an emphasis on response rate versus I guess any kind of event driven efficacy data. So I guess I'm just curious based upon the eligibility criteria of tamarac, what percentage of patients who are expecting to actually have soft tissue disease that is versus the valuable.

Oh go with that from that parameter I think.

Our experience in many of the trials to date at least half those patients and I would not be surprised given this is an international stuff.

Study.

Based on actually the results from the lorry trial that we presented almost all the majority of those patients.

Had.

Visceral involvement was not only buying environment itself.

I'm not.

At this point.

I am not concerned that we will be seeing a tissue limited population I think there'll be enough data.

And then clearly we will monitor that going forward and we certainly can add more patients if necessary, but I don't think that's going to be a problem.

Okay.

Just.

A question on <unk>.

Overdue, so you've <unk>.

Pressed the pause button here on single agent dose expansion in other tumor types.

Yes.

Despite some of the early signs of efficacy that you talked about earlier.

Are you thinking of re initiating any of those development efforts again once you get confirmation on dosing and scheduling for tamarac or does this nextgen ADC effort now kind of get prioritized in front of in front of overdue.

Yes.

My answer to you is we certainly are interested given the broad expression of <unk> three.

Of course.

A large number of solid tumors and our experience with them that.

Additional tumor types will be.

Soon <unk>.

Nearly we would like to see.

With Barbara duo.

That improvement in safety, which I discussed earlier, and one and I mean I can guess at this point.

All we can forge ahead and does move there, but I think it's more prudent given as I said earlier today that.

<unk> is going well and we'll have the answers soon.

Two initiate other tumor types at that at that point.

We feel very strongly that we are building a.

Great opportunity in franchise within prostate cancer.

With Laurie.

With Vo broad potential combination and then as we said today.

The plans to start.

Yeah with academic collaborators.

<unk> study with <unk> in prostate cancer. So we're trying to really cover the entire landscape for.

<unk> for treatment of patients with prostate, but that does not.

Interfere with our enthusiasm for pursuing this in other tumors as well.

Alright, thanks for taking the questions.

Thank you. Our next question comes from Jon Miller with Evercore ISI. Your line is open.

Hi, guys. Thanks for taking the question.

Would love to ask more about the financials and the runway guidance.

You mentioned that covers tamarac and Lloyd phase II in ongoing trials, how much does that cover of a new ADC how much does that cover.

For trials that are currently running and anticipate to start and does that count any new indications either for both the duo offer for Lori and expansion.

Yeah. Thanks, Jon very good question, obviously with.

With today's announcement, we're very excited about getting that additional $50 million milestone from.

Hum achieving it through.

No.

The results of the protect study.

And so obviously.

Just again to put it in context.

As we said earlier with the $320 million in the past you have non dilutive capital.

The likelihood of additional milestones goes up.

Because of the hitting the primary endpoint of course is dependent on.

The opportunity to get.

<unk> approved in.

The new indication as well as <unk>.

Different regions for the original indication that has been already approved in the U S FDA, but that increases likelihood there which means.

Potential increased opportunities for more milestones and as well as royalties I should also point out that.

Inside announced.

Last week that they completed enrollment.

In the two registration studies.

Hum.

For.

For the anti PD one <unk>.

<unk> in lung cancer and anal cancer, so again with those readouts.

Results accrue.

The successful what we have on the table or a potential $320 million of regulatory clinical milestones. Another $3 30 in commercial so over 600 million there.

And we still have the potential for another $380 million from Santa Fe, So that's over $1 billion of potential milestones.

From two approved products, so getting back to the essence of your question just with this additional 50.

And the studies ongoing that does include.

The new.

Antibody drug conjugate that we will file an IND in the fourth quarter. This year. It does include the opportunity to do additional studies.

Whether it be for new tumor indications.

Or.

Additional studies in different lines of prostate cancer those are under discussion right now and it doesn't take away from any of the work pre clinically for our second ADC from the Synaptics that we said is ongoing right now, which we're hoping to target for <unk> in 2002.

<unk> four plus a lot of other preclinical development activity that we have not discussed today. So.

We're very very very encouraged both with our cash runway and the opportunity to pursue a very robust clinical and preclinical pipeline.

Great that makes sense I guess I know you sometimes include risk adjusted future milestones and your cash runway can you talk a little bit about how much of that potential $1 billion in milestones youre counting on when you give that when we enter 26.

Yes, we haven't broken that down.

Clearly when we make those adjustments based on.

Real time results in and certainly we have the opportunity to adjust up our profitability.

Based on the fact that therapy.

Saturday has said that they are going for regulatory approval.

Obviously, we'd like to see the data we have not seen the data on the result of the new study.

But we are at this point, we're not in there.

A position to break out the specifics there.

This is Jim Jonathan I would just add to that that historically, if we look back at the probabilities that we use for risk adjustment.

Been very conservative.

Okay makes sense.

Thanks, so much.

Thank you.

Thank you. Our next question comes from Silvan <unk> with JMP Securities. Your line is open.

Yeah, Hi, Thanks for taking my question.

A couple of question on Tomo rock here.

The patients.

Group that you're expecting to enroll by the end of the euro or maybe early next year will that have sufficient chemo naive patients that that could be also an option.

You know it may be better than.

Chemo experienced patient.

For a registrational study or.

What are your options. After you know in terms of patient populations that you have for the phase III go on.

No no actually that is a one one of the hard one of the several hard fast enrollment criteria. They had to have had been exposed.

Exposed to a chemotherapeutic both likely.

Docetaxel so.

In this particular study we are not we want to really compare.

The results as I described earlier of the preview of our previous experiences with Boba in a later line population that has a chemo experience.

Not in this study we are certainly interested in looking at opportunities in earlier lines of therapy.

Including hormone sensitive populations, but.

Nothing is on the table right now.

Great. Thanks, that's very helpful and then.

At <unk>, we saw first in human data from our Handfuls ADC of director at <unk> III are there any learnings from that that we can apply to Barbara Doyle.

Yeah, I mean, I would say the most encouraging data was obviously a small data set and they were talking about expansion into other tumor types is that of the nine patients.

With.

Small cell lung cancer, seven had objective responses, which fits.

The data that Daiichi has discussed also in the small cell populations. So clearly this is a.

It's a logical type that.

We are certainly considering.

Adding to the types being tested.

As you May recall, we have only had one patients with small cell cancer in our dose escalation, who actually did very well on on vulgar at a lower dose.

That patient was on treatment for over six months.

Tumor shrinkage it didn't have an objective response, but really.

Responded well to the therapy so clearly.

That opens up.

For us.

A confirmation that our small cell maybe an indication we should also pursue.

Great well thanks, Thanks for taking my questions. Thank you.

Thank you. Our next question comes from Boris <unk> with TD Cowen Your line is open.

Hi, My name is <unk> I would like to add.

Oscar how confidant for love duo how confident are you that the two doses that you're testing will give you the idea of a dose moving forward and you think about the Registrational trial.

Do you expect to further dose modification if needed.

Thank you.

So.

Any experiment being conducted you go with the data you have and you have a hypothesis.

We feel that the doses we selected the right ones. This was based on a full analysis of the data and all the expansion cohorts with regard to side effect profiles tumor responses.

Pharmacokinetics and so we tried to bookend based on what the real exposure was in patients as I commented on earlier the majority of patients had dose reductions. So we feel that we have.

The two doses that.

Could give us more clarity with regard to and improve.

Safety profile and activity profile, so as much as.

That can guide us.

We're hoping that that was the right the right selection the right answer and if we have to make modifications.

In some ways subsequently once we get the data we'll do it if the drug looks our boats.

Active as well as a relatively safe.

Yes.

Got it thank you for taking my question.

Thank you as a reminder, if you'd like to ask a question. Please press star one one.

There are no further questions I'd like to turn the call back over to Dr. <unk> for closing remarks.

Thank you very much operator, and thank you everyone for participating in our call today, we look forward to providing further updates both on our clinical and preclinical pipeline in the coming months have a good day.

Thank you for your participation. This does conclude the program and you may now disconnect everyone enjoy the rest of your day.

Yeah.

Okay.

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Okay.

Okay.

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