Q2 2026 Legend Biotech Corp Earnings Call

Operator: Good day everyone, and thank you for standing by. Welcome to Legend Biotech Q2 2026 earnings call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question and answer session. To ask a question, you will need to press star 11 on your telephone. You will then hear a message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. Now it is my pleasure to hand the conference to Caroline Paul, Director of Investor Relations. Please go ahead.

Speaker #1: Good day, everyone, and thank you for standing by. Welcome to the Legend Biotech Q2 2026 earnings call. At this time, all participants are in a listen-only mode.

Speaker #1: After this speaker's presentation, there will be a question-and-answer session. To ask a question, you will need to press *11 on your telephone. You will then hear a message advising your hand is raised.

Speaker #1: To withdraw your question, please press *11 again. Please be advised that today's conference is being recorded. Now, it's my pleasure to hand the conference to Caroline Paul, Director of Investor Relations. Please go ahead.

Speaker #2: Good morning. This is Caroline Paul, Director of Investor Relations at Legend Biotech. Thank you for joining our conference call today to review our Q2 2026 performance.

Caroline Paul: Good morning. This is Caroline Paul, Director of Investor Relations at Legend Biotech. Thank you for joining our conference call today to review our Q2 2026 performance. Prior to this call, we issued a press release announcing our financial results for the quarter, which can be found on the Legend Biotech investor relations website. Joining me on today's call are Alan Bash, the company's Interim Chief Executive Officer, and Carlos Santos, the company's Chief Financial Officer. Following the prepared remarks, we will open up the call for Q&A. We also have our Interim Head of R&D, Yuhong Qiu, joining the Q&A session. During today's call, we will be making forward-looking statements which are subject to risks and uncertainties that may cause our actual results to differ materially from those expressed or implied herewith.

Speaker #2: Prior to this call, we issued a press release announcing our financial results for the quarter, which can be found on the Legend Biotech Investor Relations website.

Speaker #2: Joining me on today's call are Alan Bash, the company's Interim Chief Executive Officer, and Carlos Santos, the company's Chief Financial Officer. Following the prepared remarks, we will open up the call for Q&A.

Speaker #2: We also have our interim head of R&D, Yuhang Qiu, joining the Q&A session. During today's call, we will be making forward-looking statements, which are subject to risks and uncertainties that may cause our actual results to differ materially from those expressed or implied herein.

Speaker #2: These forward-looking statements are discussed in greater detail in our SEC filings, which we encourage you to read and which can be found under the Investor section of our company website.

Caroline Paul: These forward-looking statements are discussed in greater detail in our SEC filings, which we encourage you to read and can be found under the investor section of our company website. In addition, adjusted net income or loss is a non-IFRS metric. This non-IFRS financial measure is an addition to and not a substitute for or superior to measures of financial performance prepared in accordance with IFRS. There are a number of limitations related to the use of these non-IFRS financial measures versus their closest IFRS equivalents. However, we believe that providing information concerning adjusted net income or loss and adjusted net income or loss per share enhances an investor's understanding of our financial performance. Our press release includes IFRS to non-IFRS reconciliations for these measures. With that, I will now turn the call over to Alan.

Speaker #2: In addition, adjusted net income or loss is a non-IFRS metric. This non-IFRS financial measure is an addition to, and not a substitute for or superior to, measures of financial performance prepared in accordance with IFRS.

Speaker #2: There are a number of limitations related to the use of these non-IFRS financial measures versus their closest IFRS equivalents. However, we believe that providing information concerning adjusted net income or loss and adjusted net income or loss per share enhances an investor's understanding of our financial performance.

Speaker #2: Our press release includes IFRS to non-IFRS reconciliations for these measures. With that, I will now turn the call over to Alan.

Speaker #3: Thank you, Caroline, and good morning, everyone. I want to start by briefly addressing the leadership transition announced last month. As you all know, Dr. Ying Huang stepped down as Chief Executive Officer and member of the Board.

Alan Bash: Thank you, Caroline, and good morning, everyone. I want to start by briefly addressing the leadership transition announced last month. As you all know, Dr. Ying Huang stepped down as Chief Executive Officer and member of the board, and the board appointed me to serve as Interim Chief Executive Officer. On behalf of the board and all our employees, I want to thank Ying for his leadership over many years and his many contributions to Legend Biotech. We want to be very clear. This is a leadership transition, not a strategy transition. Our priorities remain unchanged. We remain focused on three main objectives: maximizing CARVYKTI, advancing our next-generation pipeline, and strengthening our execution on all fronts. My commitment is to provide continuity, transparency, and disciplined execution, working closely with Carlos, our senior R&D team, the board, and the broader leadership team to maintain momentum across the business.

Speaker #3: And the board appointed me to serve as Interim Chief Executive Officer. On behalf of the board and all our employees, I want to thank Ying for his leadership over many years and his many contributions to Legend Biotech.

Speaker #3: We want to be very clear: this is a leadership transition, not a strategy transition. Our priorities remain unchanged. We remain focused on three main objectives: maximizing Carvykti, advancing our next-generation pipeline, and strengthening our execution on all fronts.

Speaker #3: My commitment is to provide continuity, transparency, and disciplined execution, working closely with Carlos, our senior R&D team, the board, and the broader leadership team to maintain momentum across the business.

Speaker #3: We are operating from a strong foundation, with continued Carvykti momentum, meaningful progress across our in vivo CAR-T platform, and, as you are about to see from the Q2 results, the financial flexibility to continue investing in growth, innovation, and long-term value creation.

Alan Bash: We are operating from a strong foundation with continued CARVYKTI momentum, meaningful progress across our in vivo CAR T platform, and as you are about to see from the Q2 results, the financial flexibility to continue investing in growth, innovation, and long-term value creation. Notably, during the second quarter, we generated adjusted net income of $63 million, and we believe we will maintain adjusted net income profitability for the H2 of 2026. Now let's turn to our second quarter highlights. We had a strong second quarter at Legend as CARVYKTI continues to expand globally, maintaining its market leadership in CAR T. Additionally, we recently presented compelling early efficacy and safety data from our in vivo CAR T platform, and plan to provide meaningful updates to these programs at future medical conferences.

Speaker #3: Notably, during Q2, we generated adjusted net income of $63 million, and we believe we will maintain adjusted net income profitability for the second half of 2026.

Speaker #3: Now let's turn to our Q2 highlights. We had a strong Q2 at Legend, as Carvykti continues to expand globally, maintaining its market leadership in CAR-T.

Speaker #3: Additionally, we recently presented compelling early efficacy and safety data from our in vivo CAR-T platform, and we plan to provide meaningful updates to these programs at future medical conferences.

Speaker #3: During the quarter, Carvicti delivered worldwide net trade sales of approximately $657 million representing 50% year-over-year growth, driven by strong demand globally and increasing adoption in earlier lines of therapy.

Alan Bash: During the quarter, CARVYKTI delivered worldwide net trade sales of approximately $657 million, representing 50% year-over-year growth, driven by strong demand globally and increasing adoption in earlier lines of therapy. In the United States, sales increased 32% year-over-year, while ex-US sales grew 128% year-over-year. Beyond commercial execution, we continue to advance our innovative next generation cell therapy pipeline, particularly in our in vivo CAR T platform, as highlighted by our participation at the ASCO annual meeting and the European Hematology Association Congress. We will turn to these updates in just a moment. Finally, we strengthened our balance sheet through the successful completion of a public equity offering, resulting in approximately $212 million of net proceeds and a cash position of approximately $965 million at the end of the second quarter.

Speaker #3: In the United States, sales increased 32% year-over-year, while ex-U.S. sales grew 128% year-over-year. Beyond commercial execution, we continue to advance our innovative next-generation cell therapy pipeline, particularly in our in vivo CAR-T platform, as highlighted by our participation at the ASCO Annual Meeting and the European Hematology Association Congress.

Speaker #3: We will turn to these updates in just a moment. Finally, we strengthened our balance sheet through the successful completion of a public equity offering, resulting in approximately $212 million of net proceeds and a cash position of approximately $965 million at the end of Q2.

Speaker #3: Drilling deeper on Carvicti's Q2 performance, Carvicti global net trade sales increased 50% year-over-year to $657 million, delivering strong global sequential growth of 10% compared to the first quarter.

Alan Bash: Drilling deeper on CARVYKTI's second quarter performance, CARVYKTI global net trade sales increased 50% year-over-year to $657 million, delivering strong global sequential growth of 10% compared to the first quarter. In the United States, quarter-over-quarter growth of 9% was primarily driven by accelerating adoption in earlier lines of therapy. We continue to increase the usage in second and third lines, up from the 41% we discussed last quarter. We have also been expanding treatment access with more than 150 authorized treatment centers, of which approximately 40% are community hospitals. Outside the United States, quarter-over-quarter growth of 13% was primarily driven by continued launch uptake across 19 markets and expansion of the activated treatment site network. We recently launched CARVYKTI in Ireland, further expanding availability to 348 global treatment sites, reflecting continued geographic expansion with our partner, Johnson & Johnson.

Speaker #3: In the United States, Q2 over Q2 growth of 9% was primarily driven by accelerating adoption in earlier lines of therapy. We continue to increase the usage in second and third lines, up from the 41% we discussed last quarter.

Speaker #3: We have also been expanding treatment access, with more than 150 authorized treatment centers of which approximately 40% are community hospitals. Outside the United States, Q2 over Q2 growth of 13% was primarily driven by continued launch uptake across 19 markets and expansion of the activated treatment site network.

Speaker #3: We recently launched Carvicti in Ireland, further expanding availability to 348 global treatment sites, reflecting continued geographic expansion with our partner J&J. Across geographies, we continue to see encouraging trends in both market penetration and earlier line utilization.

Alan Bash: Across geographies, we continue to see encouraging trends in both market penetration and earlier line utilization. These dynamics support our belief that CARVYKTI remains a durable growth opportunity. Turning to our recent clinical data, we shared encouraging updates across both our solid tumor and multiple myeloma programs at ASCO this year. LB2102 is our DLL3-targeted CAR T therapy being evaluated in small cell lung cancer and large cell neuroendocrine carcinoma. LB2102 demonstrated a manageable safety profile and encouraging clinical activity in a heavily pretreated patient population. Higher dose levels achieved an objective response rate of 28.6% and a disease control rate of 78.6% with durable responses observed. Solid tumors remain difficult to treat with limited therapeutic options, so this is an encouraging sign. As a reminder, we have an exclusive global licensing agreement with Novartis to develop and commercialize LB2102 and other DLL3-targeting CAR T therapies discovered by Legend.

Speaker #3: These dynamics support our belief that Carvykti remains a durable growth opportunity. Turning to our recent clinical data, we shared encouraging updates across both our solid tumor and multiple myeloma programs at ASCO this year.

Speaker #3: LB2102 is our DLL3-targeted CAR-T therapy being evaluated in small cell lung cancer and large cell neuroendocrine carcinoma. LB2102 demonstrated a manageable safety profile and encouraging clinical activity in a heavily pre-treated patient population.

Speaker #3: Higher dose levels achieved an objective response rate of 28.6% and a disease control rate of 78.6%, with durable responses observed. Solid tumors remain difficult to treat, with limited therapeutic options, so this is an encouraging sign.

Speaker #3: As a reminder, we have an exclusive global licensing agreement with Novartis to develop and commercialize LB2102 and other DLL3 targeting CAR-T therapies discovered by Legend.

Speaker #3: We also reported additional CAR-T2 program data supporting the durable efficacy and consistent safety profile of Carvicti in multiple myeloma. These data included sustained progression-free and overall survival benefit across cytogenetic risk groups, along with a low-incidence of immune effector cell-associated enterocolitis.

Alan Bash: We also reported additional CARTITUDE-4 program data supporting the durable efficacy and consistent safety profile of CARVYKTI in multiple myeloma. These data include a sustained progression-free and overall survival benefit across cytogenetic risk groups, along with a low incidence of immune effector cell-associated enterocolitis. Notably, in the CARTITUDE-4 subgroup analysis, patients who responded to bridging therapy demonstrated 30-month overall survival rates exceeding 85% with no cases of IEC-associated parkinsonism. Taken together, these presentations further reinforce both the strength of the CARVYKTI clinical profile and the breadth of our innovation pipeline. The most notable recent pipeline update was our phase I LB2501 study, with data presented at the European Hematology Association Congress in June. LB2501 is a CD19/CD20 dual-targeting in vivo CAR T therapy for the treatment of relapsed/refractory non-Hodgkin lymphoma.

Speaker #3: Notably, in the CAR-T24 subgroup analysis, patients who responded to bridging therapy demonstrated 30-month overall survival rates exceeding 85%, with no cases of IEC-associated Parkinsonism.

Speaker #3: Taken together, these presentations further reinforce both the strength of the Carvicti clinical profile and the breadth of our innovation pipeline. The most notable recent pipeline update was our Phase I LB2501 study, with data presented at the European Hematology Association Congress in June.

Speaker #3: LB2501 is a CD19/CD20 dual-targeting in vivo CAR-T therapy for the treatment of relapsed refractory non-Hodgkin's lymphoma. The new results were the first human data with our in vivo platform, reported from an ongoing dose escalation Phase I study.

Alan Bash: The new results were the first human data with our in vivo platform and from an ongoing dose escalation phase I study. The data presented at EHA included 12 patients, with six patients in each of the two dose cohorts as part of an investigator-initiated trial conducted in China. We had compelling results at dose level 2, achieving a 100% objective response rate and an 83.3% complete response rate across the six patients with diffuse large B-cell lymphoma, mantle cell lymphoma, and follicular lymphoma. We also observed impressive in vivo CAR T cell persistence in peripheral blood with cells detectable up to 116 days based on these early results. From a safety perspective, LB2501 was well-tolerated with no dose-limiting toxicities, no serious adverse events, and no deaths reported.

Speaker #3: The data presented at EHOT included 12 patients, with 6 patients in each of the two dose cohorts, as part of an investigator-initiated trial conducted in China.

Speaker #3: We had compelling results at dose level 2, achieving a 100% objective response rate and an 83.3% complete response rate across the six patients, with diffuse large B-cell lymphoma, mantle cell lymphoma, and follicular lymphoma.

Speaker #3: We also observed impressive in vivo CAR-T cell persistence in peripheral blood, with cells detectable up to 116 days based on these early results. From a safety perspective, LB2501 was well tolerated, with no dose-limiting toxicities, no serious adverse events, and no deaths reported.

Speaker #3: We anticipate filing a US IND for LB2501 by the end of the year to initiate a US-based clinical program in NHL and plan to report additional data from the China study in due course.

Alan Bash: We anticipate filing a US IND for LB2501 by the end of the year to initiate a US-based clinical program in NHL, and plan to report additional data from the China study in due course. These results represent an important milestone for our entire in vivo CAR T platform, which has broad applicability and includes other candidates with other targets in additional indications, and supports our continued investment and development of candidates using our in vivo platform. Beyond LB2501, we continue to advance a broad and diversified pipeline spanning autologous, allogeneic, and in vivo cell therapies. As it relates to CARVYKTI, multiple frontline multiple myeloma studies remain ongoing, including CARTITUDE-5, CARTITUDE-6, as well as others, which could potentially expand our market opportunity into the first-line setting. Across our autologous portfolio, we continue to develop therapies targeting claudin 18.2, DLL3, GPRC5D, and dual target approaches for multiple myeloma.

Speaker #3: These results represent an important milestone for our entire in vivo CAR-T platform, which has broad applicability and includes other candidates with other targets in additional indications, and supports our continued investment in and development of candidates using our in vivo platform.

Speaker #3: Beyond LB2501, we continue to advance a broad and diversified pipeline spanning autologous, allogeneic, and in vivo cell therapies. As it relates to Carvykti, multiple frontline multiple myeloma studies remain ongoing, including CARTITUDE-5, CARTITUDE-6, as well as others, which could potentially expand our market opportunity into the first-line setting.

Speaker #3: Across our autologous portfolio, we continue to develop therapies targeting clotting 18.2, DLL3, GPRC5D, and dual-target approaches for multiple myeloma. We are also advancing several off-the-shelf CAR-T programs ranging from allogeneic programs for autoimmune disease and B-cell malignancies as well as additional in vivo CAR-T candidates beyond LB2501, which I just described, for its impressive first human data in a Phase I trial at EHOT.

Alan Bash: We are also advancing several off-the-shelf CAR T programs, ranging from allogeneic programs for autoimmune disease and B-cell malignancies, as well as additional in vivo CAR T candidates beyond LB2501, which I just described for its impressive first human data in a phase I trial at EHA. Overall, we believe this portfolio reflects a balanced approach to innovation across the different modalities of CAR T, while leveraging our expertise in cell therapy development and manufacturing. Looking ahead, we believe Legend is well-positioned for sustainable long-term growth. We continue to advance our pipeline and are working towards an IND submission for LB2501 by the end of the year. We ended the period with approximately $965 million in cash equivalents, and time deposits. Commercially, CARVYKTI remains a leading franchise in multiple myeloma and continues to demonstrate strong global momentum, expanding into new markets on a regular basis.

Speaker #3: Overall, we believe this portfolio reflects a balanced approach to innovation across the different modalities of CAR-T, while leveraging our expertise in cell therapy development and manufacturing.

Speaker #3: Looking ahead, we believe Legend is well positioned for sustainable long-term growth. We continue to advance our pipeline and are working towards an IND submission for LB2501 by the end of the year.

Speaker #3: We ended the period with approximately 965 million dollars in cash, cash equivalents and time deposits, and commercially, Carvicti remains a leading franchise in multiple myeloma and continues to demonstrate strong global momentum, expanding into new markets on a regular basis.

Speaker #3: We also continue to believe Carvicti has a peak annual sales potential exceeding $5 billion, and we are making meaningful steps to reach that goal.

Alan Bash: We also continue to believe CARVYKTI has a peak annual sales potential exceeding $5 billion, and we are making meaningful steps to reach that goal. Supported by a durable commercial business, a deep pipeline, and a focus on execution, we remain committed to achieving company-wide profitability in 2026. With that, I will turn over the call to Carlos.

Speaker #3: Supported by a durable commercial business, a deep pipeline, and a focus on execution, we remain committed to achieving company-wide profitability in 2026. And with that, I will turn over the call to Carlos.

Speaker #1: Thank you, Alan. This quarter's financial results continue to demonstrate the operating leverage inherent in our business model. Revenue has scaled at a CAGR of 74% since the second quarter of 2023.

Carlos Santos: Thank you, Alan. This quarter's financial results continue to demonstrate the operating leverage inherent in our business model. Revenue has scaled at a CAGR of 74% since Q2 2023, supported by growing demand for CARVYKTI and continued commercial execution. At the same time, operating margins have improved significantly from -142% in Q2 2023 to a +15% in Q2 2026. This now marks a major milestone objective for Legend as the first quarter of company-wide profitability on both an IFRS and an adjusted basis. Going forward, we will continue to focus on adjusted net income as the metric for sustained profitability. While we remain focused on investing in the future growth of Legend, we are doing so with increasing discipline and operating efficiency. Turning to our quarterly financial performance.

Speaker #1: Supported by growing demand for Carvykti and continued commercial execution, operating margins have also improved significantly—from negative 142% in the second quarter of 2023 to a positive 15% in the second quarter of 2026.

Speaker #1: This now marks a major milestone objective for Legend, as the first quarter of company-wide profitability on both an IFRS and an adjusted basis. Going forward, we will continue to focus on adjusted net income as the metric for sustained profitability.

Speaker #1: While we remain focused on investing in the future growth of Legend, we are doing so with increasing discipline and operating efficiency. Turning to our quarterly financial performance, total revenue increased 52% year over year, driven by continued CARVYKTI demand and commercial expansion.

Carlos Santos: Total revenue increased 52% year-over-year, driven by continued CARVYKTI demand and commercial expansion. Given the recent increases in international sales, we wanted to note that we are using Legend's foreign exchange rates for CARVYKTI collaboration revenue, which we also plan to use going forward. Each quarter, Legend receives the collaboration revenue through a profit split analysis in US dollars as constant currency. From an accounting perspective, the revenue is then converted to the appropriate functional currency using Legend's foreign exchange rates, which may differ from our partners. While we expect the differences each quarter to be small over the near term, we wanted to specifically call it out this quarter as international sales are becoming an increasing percentage of the overall revenue.

Speaker #1: Given the recent increases in international sales, we wanted to note that we are using Legend's foreign exchange rates for Carvicti collaboration revenue, which we also plan to use going forward.

Speaker #1: Each quarter, Legend receives the collaboration revenue through a profit split analysis in US dollars as constant currency. From an accounting perspective, the revenue is then converted to the appropriate functional currency using Legend’s foreign exchange rates, which may differ from our partners’.

Speaker #1: While we expect the differences each quarter to be small over the near term, we wanted to specifically call it out this quarter as international sales are becoming an increasing percentage of the overall revenue.

Speaker #1: And in any given quarter, an increase in international revenue and/or a significant movement in foreign exchange rates between the euro and the US dollar could result in additional divergence between the revenues reported by our collaboration partner and the revenue that Legend reports.

Carlos Santos: In any given quarter, an increase in international revenue and/or a significant movement in foreign exchange rates between the euro and the US dollar could result in additional divergence between the revenues reported by our collaboration partner and the revenue that Legend reports. As we look at collaboration revenue growth for the remainder of the year, we wanted to offer some thoughts on quarterly progression in Q3 and Q4. As we have been consistently saying, we are pleased with the steady, increasing rate of CARVYKTI penetration into the second to the fourth lines of treatment, which is our focus, and has now grown to be over 70% of our volume. With the increasing penetration into earlier lines has also come increasing usage in the outpatient setting. With a higher percentage of outpatient volume contributing to the revenue mix comes a different set of gross margin dynamics.

Speaker #1: As we look at collaboration revenue growth for the remainder of the year, we wanted to offer some thoughts on quarterly progression in Q3 and Q4.

Speaker #1: As we have been consistently saying, we are pleased with the study increasing rate of Carvicti penetration into the second to the fourth lines of treatment, which is our focus and has now grown to be over 70% of our volume.

Speaker #1: With the increasing penetration into earlier lines, there has also been increasing usage in the outpatient setting. And with a higher percentage of outpatient volume contributing to the revenue mix, comes a different set of gross margin dynamics.

Speaker #1: Additionally, we expect to see an increase in Q4 revenue from an extra selling week in this calendar year and greater international expansion compared to Q3.

Carlos Santos: Additionally, we expect to see an increase in Q4 revenue from an extra selling week in this calendar year and greater international expansion compared to Q3. Despite these fluctuations, we remain confident in our adjusted net income profitability projections for both Q3 and Q4. Moving down the income statement, gross margin on net product sales grew 1% year-over-year, improving to 58%, which was an improvement of 17% compared with 41% for the first quarter of 2026, which, as you may recall, was artificially low, primarily due to one-time costs associated with manufacturing expansion, which we unwound in the second quarter, adding additional one-time favorability of a few percentage points to our Q2 gross margin.

Speaker #1: Despite these fluctuations, we remain confident in our adjusted net income profitability projections for both Q3 and Q4. Moving down the income statement, gross margin on net product sales grew 1% year over year, improving to 58%, which was an improvement of 17% compared with 41% for the first quarter of 2026.

Speaker #1: Which, as you may recall, was artificially low primarily due to one-time costs associated with manufacturing expansion, which we unwound in the second quarter, adding additional one-time favorability of a few percentage points to our Q2 gross margin.

Speaker #1: Going forward, gross margin on net product sales will be more reflective of volume as we continue to expect improvements over time by leveraging our investments in manufacturing to scale and increasing utilization across all nodes, however, it is important to realize that there is still likely to be quarter-to-quarter variability in gross margin and we expect Q3 gross margin on net product sales to be in the lower 50% range with a rebound into the mid 50% range anticipated for Q4.

Carlos Santos: Going forward, gross margin on net product sales will be more reflective of volume as we continue to expect improvements over time by leveraging our investments in manufacturing to scale and increasing utilization across all nodes. However, it is important to realize that there is still likely to be quarter-to-quarter variability in gross margin, and we expect Q3 gross margin on net product sales to be in the lower 50% range, with a rebound into the mid-50% range anticipated for Q4. Total operating expenses increased only 7% year-over-year, reflecting our continued focus on disciplined investment and operating leverage. Research and development expenses decreased 2% year-over-year as the cost from the later-stage BCMA frontline clinical studies roll off. This will be partially offset by increased spending in our in vivo assets as they move into phase I and later studies.

Speaker #1: Total operating expenses increased only 7% year over year, reflecting our continued focus on disciplined investment and operating leverage. Research and development expenses decreased 2% year over year, as the costs from the later-stage BCMA frontline clinical studies roll off.

Speaker #1: This will be partially offset by increased spending in our in vivo assets as they move into Phase 1 and later studies. Selling, general, and administrative expenses increased 19%, primarily driven by investment supporting sustained leadership in BCMA CAR-T markets.

Carlos Santos: Selling, general, and administrative expenses increased 19%, primarily driven by investments supporting sustained leadership in BCMA CAR T markets. As a result, operating margin improved to a positive 15%, compared with negative 9% in the second quarter of 2025. Regarding taxes, we had an income tax expense of $22.3 million during the second quarter, compared to an income tax expense of approximately $600,000 for the same quarter last year. The year-over-year increase was primarily driven by an increase in taxable income across our US, Belgium, and PRC entities. As we have now achieved company-wide profitability on a quarterly basis for the first time, I wanted to provide more detail on our tax rate and the effect of various tax jurisdictions as you develop your longer-term financial models.

Speaker #1: As a result, operating margin improved to a positive 15%, compared with negative 9% in the second quarter of 2025. Regarding taxes, we had an income tax expense of $22.3 million during the second quarter, compared to an income tax expense of approximately $600,000 for the same quarter last year.

Speaker #1: The year-over-year increase was primarily driven by an increase in taxable income across our US, Belgium, and PRC entities. As we have now achieved company-wide profitability on a quarterly basis for the first time, I wanted to provide more detail on our tax rate and the effect of various tax jurisdictions as you develop your longer-term financial models.

Speaker #1: We are in the process of negotiating a unilateral Advance Pricing Agreement with the Chinese tax authorities, as part of our proactive tax governance strategy.

Carlos Santos: We are in the process of negotiating a unilateral advance pricing agreement with the Chinese tax authorities as part of our proactive tax governance strategy. Although a formal agreement has not yet been formally executed, we have now reflected the expected impact of the agreement as a component of income tax expense in our Q2 numbers. We expect to report income tax in each quarter that we are profitable. Although we are not yet at a point that we can provide more precise guidance, we anticipate a tax rate in the high 20% range over the next several quarters. In addition, although quarterly adjusted net income may vary from quarter to quarter over the near term, primarily driven by some expected fluctuations in gross margins I mentioned earlier, we are increasingly confident in the long-term durability of our profitability profile.

Speaker #1: Although a formal agreement has not yet been executed, we have now reflected the expected impact of the agreement as a component of income tax expense in our Q2 numbers.

Speaker #1: We expect to report income tax in each quarter that we are profitable, and although we are not yet at a point where we can provide more precise guidance, we anticipate a tax rate in the high 20% range over the next several quarters.

Speaker #1: In addition, although quarterly adjusted net income may vary from quarter to quarter over the near term, primarily driven by some expected fluctuations in gross margins I mentioned earlier, we are increasingly confident in the long-term durability of our profitability profile.

Speaker #1: With adjusted net income of 63 million dollars in Q2, we feel comfortable in maintaining our projection for adjusted net income profitability on an adjusted basis in 2026.

Carlos Santos: With adjusted net income of $63 million in Q2, we feel comfortable in maintaining our projection for adjusted net income profitability on an adjusted basis in 2026. On a non-IFRS basis, this represents $0.16 per diluted share, compared with adjusted net income of $10 million, or $0.03 per diluted share in the same period last year. Turning to our balance sheet, which remains a significant strategic asset. As of 30 June 2026, we held approximately $965 million in cash equivalents in time deposits and have no long-term debt. The equity offering in June contributed meaningfully to this strong cash position, allowing for additional flexibility to fund our pipeline programs and pay down our loan to Johnson & Johnson under the terms of our agreement. Our investment priorities have remained consistent, and our strategy has not changed.

Speaker #1: On a non-IFRS basis, this represents $0.16 per diluted share, compared with adjusted net income of $10 million, or $0.03 per diluted share in the same period last year.

Speaker #1: Turning to our balance sheet, which remains a significant strategic asset. As of June 30, 2026, we held approximately $965 million in cash, cash equivalents, and time deposits, and had no long-term debt.

Speaker #1: The equity offering in June contributed meaningfully to this strong cash position, allowing for additional flexibility to fund our pipeline programs and pay down our loan to Johnson & Johnson under the terms of our agreement.

Speaker #1: Our investment priorities have remained consistent, and our strategy has not changed. We remain committed to delivering sustainable profitability on adjusted net income, while still advancing our in vivo CAR-T pipeline and making modest capital investments to support manufacturing capacity expansion.

Carlos Santos: We remain committed to delivering sustainable profitability on adjusted net income while still advancing our in vivo CAR T pipeline and making modest capital investments to support manufacturing capacity expansion. Our key objectives include, first, continued quarter-over-quarter CARVYKTI growth through 2026, with a growing portion of our business coming from second to fourth line patients. Second, adjusted net income profitability for the H2 2026. Third, an IND submission for LB2501 in Q4. Lastly, presenting additional in vivo data at future medical conferences. We believe our strong financial position provides the flexibility needed to execute on all of these priorities.

Speaker #1: Our key objectives include, first, continued quarter-over-quarter CAR-VC growth through 2026, with a growing portion of our business coming from second- to forefront-line patients.

Speaker #1: Second, adjusted net income profitability for the second half of 2026. Third, an IND submission for LB2501 in Q4. And, lastly, presenting additional in vivo data at future medical conferences.

Speaker #1: We believe our strong financial position provides the flexibility needed to execute on all of these priorities. Let me end in the same way that Alan started this call.

Carlos Santos: Let me end in the same way that Alan started this call. This is a period of leadership transition and not strategy transition. Our Q2 financial results support this, and you can expect that this leadership team will continue to deliver on the clear objectives that we just laid out and to provide transparency for the investment community as we move into the H2 2026. With that, I will turn the call back to the operator to open the line for questions.

Speaker #1: This is a period of leadership transition and not strategy transition. Our Q2 financial results support this. And you can expect that this leadership team will continue to deliver on the clear objectives that we just laid out and to provide transparency for the investment community as we move into the second half of 2026.

Speaker #1: With that, I will turn the call back to the operator to open the line for questions.

Speaker #2: Thank you, Anna. As a reminder, to ask a question simply press *11 to get in the queue and wait for your name to be announced.

Operator: Thank you, and as a reminder, to ask a question, simply press star 1 1 to get in the queue and wait for your name to be announced. To withdraw your question, press star 1 1 again. One moment for our first question. It comes from Eric Smith with Cantor. Please proceed.

Speaker #2: To withdraw your question, press star, one, one, again. One moment for our first question. It comes from Eric Smith with Cantor. Please proceed.

Speaker #3: Thanks. For taking my question and congrats on achieving the milestone of profitability. My question's on the in vivo CAR-T side and the BCMA program in particular.

Eric Smith: Thanks for taking my question, and congrats on achieving the milestone of profitability. My question's on the in vivo CAR T side and the BCMA program in particular. I think Alan mentioned you're working on a variety of different targets. I assume that's still one of them. Can you provide for us an update on your strategy with your partner, J&J, and when we may hear something in addition on BCMA? Thank you.

Speaker #3: I think Alan mentioned you’re working on a variety of different targets. I assume that’s still one of them. Can you provide for us kind of an update on your strategy with your partner, J&J, and when we may hear something additional on BCMA?

Speaker #3: Thank you.

Speaker #4: Thanks, Eric, for the question. Yes, previously we had said that BCMA CAR-T programs were subject to the terms of Legend Biotech's collaboration agreement with J&J and previously we could not say more.

Alan Bash: Thanks, Eric, for the question. Yes. Previously, we had said that BCMA CAR T programs were subject to the terms of Legend Biotech's collaboration agreement with J&J, and previously we could not say more. We can now share an update, that Legend will be conducting an investigator-initiated clinical study in China evaluating LB2505, which is an investigational BCMA-targeted in vivo CAR T therapy for multiple myeloma. This program is subject to the terms of Legend Biotech's collaboration agreement with J&J, so we're not able to share additional details at this time, but we do look forward to providing updates on LB2505 when appropriate.

Speaker #4: We can now share an update that Legend will be conducting an investigator-initiated clinical study in China, evaluating LB2505, which is an investigational BCMA-targeted in vivo CAR-T therapy for multiple myeloma.

Speaker #4: This program is subject to the terms of Legend Biotech's collaboration agreement with J&J. So, we're not able to share additional details at this time, but we do look forward to providing updates on LB2505 when appropriate.

Speaker #3: Thank you.

Eric Smith: Thank you.

Speaker #2: One moment for our next question, please. It comes from Terrence Flynn with Morgan Stanley. Please proceed.

Operator: One moment for our next question, please. It comes from Terence Flynn with Morgan Stanley. Please proceed.

Speaker #5: Great. This is Chris Anford, Terrence, and thanks for taking our question. On LB2501, can you remind us what the minimum duration of response is that you think is needed to be confident in the durability of a complete response?

[Analyst] (Morgan Stanley): Great. This is Chris on for Terence, and thanks for taking our question. On LB2501, can you remind us of what the minimum duration of response you think is needed to be confident in the durability of a complete response? Is ASH a reasonable expectation for when you could release the updated phase I data? Thank you.

Speaker #5: And is ASH a reasonable expectation for when you could release the updated Phase 1 data? Thank you.

Speaker #4: Yeah. Previously at the EHA conference, we had shared durability as long as 120 days. We would be targeting ultimately to be able to share data at the six-month CR rate.

Alan Bash: Yeah. Previously at the EHA conference, we had shared durability as long as 120 days. We would be targeting, ultimately, to be able to share data at the six-month CR rate. We will be able to provide updates at future medical conferences in terms of the 2501 program.

Speaker #4: And we will be able to provide updates at future medical conferences regarding the 2501 program.

Speaker #2: One moment for our next question, which comes from John Miller with Evercore ISI. Please proceed.

Operator: One moment for our next question that comes from Jonathan Miller with Evercore ISI. Please proceed.

Speaker #6: Hello, this is Shreya Anford. John, thanks for taking my question. I would like to touch on the recent announcement for the MONUMENTAL-6 top-line data, where we saw a hazard ratio of 0.11.

Jessie Yeung: Hello, this is Jessie Yeung on for John. Thanks for taking my question. I would like to touch on the recent announcement for the MonumenTAL-6 top-line data, where we saw a hazard ratio of 0.11. This seems like physicians are gradually getting comfortable with anticipating and managing the toxicities in the study. There were also some commentary that the GPRC5D-

Speaker #6: This seems like physicians are gradually getting comfortable with anticipating and managing the tox in the study. And there were also some commentary that the GPRC5...

Alan Bash: I am sorry.

Speaker #4: I'm sorry.

Jessie Yeung: sequence. Hello? Can you hear me?

Speaker #6: Hello. Yeah, can you hear me?

Speaker #4: Your line isn't coming in as clearly. If you could just repeat the question, please?

Alan Bash: Your line is not coming in as clearly. If you could just repeat the question, please.

Speaker #6: Oh, yeah. So I would like to ask a question on the recent announcement for the Monumental 6 top line data. So it seems like physicians are gradually getting comfortable with managing and anticipating the tox in the study.

Jessie Yeung: Oh, yeah. I would like to ask a question on the recent announcement for the MonumenTAL-6 top-line data. It seems like physicians are gradually getting comfortable with managing and anticipating the toxicities in the study. There were also some commentary that the combo might be preferentially sequenced for later line usage. I would like to ask what kind of feedback you have been hearing from physicians on your end in terms of managing the toxicities and the sequencing that relative to CARVYKTI?

Speaker #6: And then there were also some comments that the combo might be preferentially sequenced for later-line usage. So I would like to ask, what kind of feedback have you been hearing from physicians on your end in terms of managing the tox, and then sequencing that relative to CAR-VC?

Speaker #4: Yeah, thanks for the question. So yes, the MONUMENTAL study was looking at the combination of TEC and TAL. And as J&J has shared publicly, they intend for that combination to be primarily used in later lines, as you point out.

Alan Bash: Yeah, thanks for the question. So yes, the MonumenTAL study was looking at the combination of Tecvayli and talquetamab. As Johnson & Johnson has shared publicly, they intend for that combination to be primarily used in later lines, as you point out. I think more generally, as we've seen the bispecific data and indications emerge, we've been very focused on educating physicians and patients on the key points of differentiation of CARVYKTI relative to other options in myeloma, in particular, other BCMA options. Of course, one is that one and done, versus continuous therapy. That's a very important driver of patient preference, of quality of life, and of the opportunity for a long-term, treatment-free interval and a long-term remission.

Speaker #4: I think, more generally, as we've seen the bispecific data and indications emerge, we've been very focused on educating physicians and patients on the key points of differentiation of CAR-VC relative to other options in myeloma.

Speaker #4: In particular, other BCMA options. Of course, one is that "one and done," right, versus continuous therapy. That's a very important driver of patient preference, of quality of life, and of the opportunity for a long-term treatment-free interval and a long-term remission.

Speaker #4: The second thing that we've been really emphasizing relative to the landscape is that the data really suggests that earlier is better with CAR-T. You get better efficacy, better safety, and improved manufacturing when you get CAR-T earlier.

Alan Bash: The second thing that we've been really emphasizing relative to the landscape is that the data really suggests that earlier is better with CAR T, and you get better efficacy, better safety, and improved manufacturing when you get CAR T earlier. Really where the conversation has gone is not really about CARVYKTI versus bispecifics, it's really about the sequencing. I think if you hear KOLs and the feedback we've been getting from KOLs, the storyline is really about the optimal sequencing and the data, both in the real world as well as additional studies. If you look at the biology, it really does point to the fact that patients will benefit if they can get to CAR T first before other options in BCMA.

Speaker #4: And really, where the conversation has gone is not really about CAR-T versus bispecifics. It's really about the sequencing. And I think if you hear KOLs—and the feedback we've been getting from KOLs—the storyline is really about the optimal sequencing and the data, both in the real world as well as additional studies. Or if you look at the biology, it really does point to the fact that patients will benefit if they can get to CAR-T first before other options in BCMA.

Speaker #6: Got it. Thank you.

Jessie Yeung: Got it. Thank you.

Speaker #2: Thank you. Our next question is from Leonid Timashev with RBC. Please proceed.

Operator: Thank you. Our next question is from Leonid Timashev with RBC. Please proceed.

Speaker #5: Hey, guys, thanks for taking my question. I just want to clarify some of the comments on the gross margins. Can you maybe just elaborate on why having more outpatients is going to change the gross margin dynamics?

Leonid Timashev: Hey, guys. Thanks for taking my question. I just want to clarify some of the comments on the gross margin. Can you maybe just elaborate on why having more outpatients is going to change the gross margin dynamics? Looking ahead, I think in the past you've talked about aiming for large molecule-like cost of goods. Is that still the plan here? Any sense of when you might achieve that with some of these modest CapEx spend plans? Thanks.

Speaker #5: And then, looking ahead, I think in the past you've talked about aiming for large molecule-like cost of goods. Is that still the plan here?

Speaker #5: Any sense of when you might achieve that with some of these modest capex spend plans? Thanks.

Speaker #4: Yes, thanks for the question. All we would say at this point is that as outpatient grows, and outpatient is starting to become approximately 60% of our overall mix, it does come with various dynamics which could potentially impact gross margin.

Alan Bash: Yes, thanks for the question. All we would say at this point is that as outpatient grows, and outpatient is starting to become approximately 60% of our overall mix, it does come with various dynamics which could potentially impact gross margin. That's all we're able to say at this point on that. Let me turn it to Carlos to your second question.

Speaker #4: So that's all we're able to say at this point on that. But let me turn it to Carlos for your second question.

Speaker #3: Yeah. So, Leonid, in terms of the path for gross margin, we are still expecting our cost of goods sold to decline over time. We have to get to a certain level of volume to keep up the consistency, but once all of our nodes are at a steady state, our gross margins will be in line with what we believe is industry standards.

Carlos Santos: Yes. Leonard, in terms of the path for gross margin, we are still expecting our cost of goods sold to decline over time. We have to get to a certain level of volume to keep up the consistency, but once all of our nodes are at a steady state, our gross margins will be in line with what we believe is industry standards of around 75%. We actually have. We see a clear path to 75% over time.

Speaker #3: Of around 75%. And we actually see a clear path to 75% over time.

Speaker #2: Thank you. One moment for our next question, which comes from Jessica Fai with JP Morgan. Please proceed.

Operator: Thank you. One moment for our next question that comes from Jessica Fye with J.P. Morgan. Please proceed.

Speaker #6: Hey guys, good morning. Thanks for taking my questions. I had two, kind of on the other financial side. First, can you just expand a little bit on the comments you made about how to think about the revenue cadence in Q3 and Q4?

Jessica Fye: Hey, guys. Good morning. Thanks for taking my questions. I had two on the financial side. First, can you just expand a little bit on the comments you made about how to think about the revenue cadence in Q3 and Q4? Second, can you just recap the motivation behind the recent equity raise given that the company is still very committed to achieving profitability this year? Thank you.

Speaker #6: And second, can you just recap the motivation behind the recent equity raise, given that the company is still very committed to achieving profitability this year?

Speaker #6: Thank you.

Speaker #3: Thank you. Let me start by talking about the raise. The follow-on was an opportunistic equity raise following the strong in vivo data that we presented at EHA.

Carlos Santos: Thank you. Let me start with talking about the raise. The follow-on was an opportunistic equity raise following the strong in vivo data that we presented at EHA. This additional capital really gives us greater flexibility to accelerate the development of LB2501 and our broader in vivo platform. This really allows us to be able to take our in vivo platform further in the development process, and this will provide us better BD optionality down the road. We continue to be confident in our profitability goals, and we will be in a stronger position to fund our R&D efforts following the loan repayment to Johnson & Johnson now that we have completed this raise.

Speaker #3: This additional capital really gives us greater flexibility to accelerate the development of LB2501 and our broader in vivo platform. This really allows us to take our in vivo platform further in the development process.

Speaker #3: And this will provide us better BD optionality down the road. We continue to be confident in our profitability goals. And we will be in a stronger position to fund our R&D efforts following the loan repayment to J&J now that we have completed this raise.

Speaker #4: And related to your first question, as we heard earlier in the call from Carlos, we are indicating global growth on a sequential basis.

Alan Bash: Related to your first question, as we heard earlier in the call from Carlos, we are indicating a global growth on a sequential basis across the balance of the two quarters in the H2 of 2026.

Speaker #4: Across the balance of the two quarters in the second half of 2026.

Speaker #6: Thank you.

Jessica Fye: Thank you.

Speaker #2: Thank you. Our next question comes from Yaron Werber with Credit Suisse. Please proceed.

Operator: Thank you. Our next question comes from Yaron Werber with TD Cowen. Please proceed.

Yaron Werber: Great. Thank you, and congrats on moving toward the ISP with in vivo in China. I have a two-part question on the tax rate in China that would be applied, it sounds like, to the global profits from now on. Is that actually going to be a cash payment or is that an accounting tax rate? Secondly, just to your answer to Jessica Fye's question on the raise, you said that the payment after the payment to Johnson & Johnson. Can you just clarify, is that relating to historical CapEx and how big that is? Thank you.

Speaker #7: Great. Thank you and congrats on moving toward the IST with in vivo in China. I have maybe just a two-part question on the tax rate in China.

Speaker #7: That would be applied, it sounds like, to the global profits from now on. Is that actually going to be a cash payment, or is that an accounting tax rate?

Speaker #7: And then secondly, just to answer your answer to Jessica's question on the raise, and you said that the payment after the payment to J&J.

Speaker #7: Can you just clarify? Is that relating to historical capex, and how big that is? Thank you.

Carlos Santos: Sorry, Yaron, could you repeat your second question?

Speaker #3: Sorry, Yaron, could you repeat your second question?

Speaker #7: I think you mentioned that there was a—maybe I misunderstood—a payment to J&J. When you were talking about the financing, I just wanted to make sure: is there any historical sort of, still, balance sheet cleanup that you need to do as part of capex?

Yaron Werber: I think you mentioned that there was a, I might have misunderstood, a payment to Johnson & Johnson when you were talking about the financing. I just wanted to make sure, is there any historical sort of sell balance sheet cleanup that you need to do as part of CapEx, or did you never actually borrow capital from Johnson & Johnson for building manufacturing facilities that is still outstanding? Thank you.

Speaker #7: So did you never actually borrow capital from J&J for building manufacturing facilities, and is it still outstanding? Thank you.

Speaker #3: Right. Yeah. So let me start there. So as part of our collaboration agreement, there was a loan of around $300 million and that accrued interest over time.

Carlos Santos: Right. So let me start there. As part of our collaboration agreement, there was a loan of around $300 million, and that accrued interest over time, that became a current liability this year. So we have been paying down both principal and interest on that loan this year. It is a combination of cash repayments to Johnson & Johnson as well as recoupment of profits from our collaboration. We expect to fully settle that liability this year. So with regards to the tax provision, we have reflected the expected impact of an agreement based on the information we have today as a component of our income tax expense in Q2. This provision not only includes the China portion, but also profitability that is realized in other legal entities for Legend.

Speaker #3: That became a current liability this year. So we have been paying down both principal and interest on that loan this year. It's a combination of cash repayments to J&J, as well as recoupment of profits from our collaboration.

Speaker #3: We expect to fully settle that liability this year. So with regards to the tax provision, we have reflected the expected impact of an agreement based on the information we have today.

Speaker #3: As a component of our income tax expense in Q2. So this provision not only includes the China portion, but also profitability that's realized in other legal entities for legends.

Speaker #2: One moment for our next question that comes from Costas Bilioris with Oppenheimer. Please proceed.

Operator: One moment for our next question that comes from Kostas Biliouris with Oppenheimer. Please proceed.

Speaker #5: Good morning. Thanks for taking our question. Maybe a couple of quick questions. One on the CEO's we are wondering whether the board cert is focused on a commercial operator for the Carvinkti RAM or perhaps a platform CEO for the in vivo CAR-T development.

Kostas Biliouris: Good morning. Thanks for taking our question. Maybe a couple of quick questions. One on the CEO search. We are wondering whether the board search is focused on a commercial operator for the CARVYKTI ramp or perhaps a platform CEO for the in vivo CAR T development. The second question is on the in vivo CAR T development and commercialization. You already touched a little bit on the BCMA, but we are wondering how are you thinking about perhaps the lead program in NHL? Are you thinking to develop this by yourself or are you still looking for a partnership there? What is the latest status? Thank you.

Speaker #5: And the second question is on the in vivo CAR-T development and commercialization. You already touched a little bit on the BCMA, but we are wondering how are you thinking about perhaps the lead program in NHL?

Speaker #5: Are you planning to develop these by yourself, or are you still looking for a partnership there? What is the latest status? Thank you.

Speaker #4: Thanks, Costas. Yeah. So, as we had previously announced, the Board has initiated a search and is conducting a thorough process for the full-time, permanent CEO position.

Alan Bash: Thanks, Kostas. So as we previously announced, the board has initiated a search, and is conducting a thorough process for the full-time permanent CEO position, and I don't think the board wants to put an artificial deadline on that process. They are also looking holistically and looking at various qualities that would provide for the best long-term leader, given the stage of the growth of the company. So I don't think there is anything specific that they wanted to share at this point about that. As it relates to your second question, as we mentioned on the call here, we are excited to say that we will be moving towards an IND with LB2501 in the second half of 2026. Our intention is to be able to conduct that phase I ourselves. We have the capabilities, and we obviously have the financial flexibility and the resources to do that.

Speaker #4: And I don't think the board wants to put an artificial deadline on that process. They are also looking holistically and considering various qualities that would provide for the best long-term leader, given the stage of growth of the company.

Speaker #4: So I don't think there's anything specific that they wanted to share at this point about that. As it relates to your second question, as we mentioned on the call here, we are excited to say that we will be moving towards an IND with 2501 in the second half of 2026.

Speaker #4: And our intention is to be able to conduct that Phase I ourselves. We have the capabilities, and we obviously have the financial flexibility and the resources to do that.

Alan Bash: We continue to remain open to various options around partnership long-term across the in vivo platform. We obviously made the announcement this morning with LB2505, moving forward in multiple myeloma and BCMA, and we will continue to assess all of our options to maximize the value, both in terms of maintaining economics, but also ensuring speed and scale to maximize the opportunity with in vivo.

Speaker #4: We continue to remain open to various options around partnership, long-term across the in vivo platform. We obviously made the announcement this morning with 2505 moving forward in multiple myeloma and BCMA.

Speaker #4: And we'll continue to assess all of our options to maximize the value both in terms of maintaining economics, but also ensuring speed and scale to maximize the opportunity with in vivo.

Speaker #2: Thank you. One moment for our next question. That comes from Etzer Darut with Barclays. Please proceed.

Operator: Thank you. One moment for our next question. That comes from Etzer Darout with Barclays. Please proceed.

Speaker #7: Hi, this is Luca from Etzer. Thanks for taking the question. Real quick, on the J&J partnership—how does that impact your in vivo development in immune disease?

[Analyst] (Barclays): Hi, this is Luca. I am from Etzer. Thanks for taking the question. Real quick on the J&J partnership, how does that impact your in vivo development in immune disease? Does that change what you are able to pursue? Then maybe can you highlight any differences between your in vivo CAR T platform and Sail?

Speaker #7: Does that change what you're able to pursue? And then maybe can you highlight any differences between your in vivo CAR-T platform and sales?

Speaker #4: Sure. So yeah, the announcement that we're making today is around BCMA CAR-T in multiple myeloma. That's the aspect of the program that is subject to the agreement with J&J.

Alan Bash: Sure. The announcement that we are making today is around BCMA CAR T in multiple myeloma. That is the aspect of the program that is subject to the agreement with J&J. So at this point now, Legend will look and step back and assess our options for autoimmune disease, where we remain very interested in autoimmune disease with multiple targets. We obviously have been looking at potentially BCMA, potentially CD19, CD20, and other targets in autoimmune, and we think in vivo can play a meaningful role there. As it relates to the J&J deal that you mentioned with Sail, I will remind you that Sail has a preclinical platform around circular mRNA and LNP. That is very different from our program, which is LV-based. We have also already shown clinical data in a very meaningful market, which is non-Hodgkin lymphoma.

Speaker #4: So at this point, now Legend will look and step back and assess our options for autoimmune disease. We remain very interested in autoimmune disease.

Speaker #4: With multiple targets, we obviously have been looking at potentially BCMA, potentially CD19, CD20. And other targets in autoimmune and we think in vivo can play a meaningful role there.

Speaker #4: As it relates to the J&J deal that you mentioned with Sale, I'll remind you that Sale has a preclinical platform around circular mRNA and LNP.

Speaker #4: And so that's very different from our program, which is LV-based and we've also already shown clinical data in a very meaningful market, which is non-Hodgkin lymphoma.

Speaker #4: So I think these are two very different opportunities. And I think it speaks to the excitement across the industry in in vivo. Many large pharma companies are looking at multiple platforms and we're very excited about the platform that we have to offer.

Alan Bash: So I think these are two very different opportunities, and I think it speaks to the excitement across the industry in in vivo. Many large pharma companies are looking at multiple platforms, and we are very excited about the platform that we have to offer.

Speaker #7: Thank you.

[Analyst] (Barclays): Thank you.

Speaker #2: Our next question comes from Edward Tenthoff with Piper Sandler. Please proceed.

Operator: Our next question comes from Edward Tenthoff with Piper Sandler. Please proceed.

Speaker #3: Great. Thank you very much. And thanks for the update from the in vivo side and all the great progress with Carvinkti. My question has to do with the rest of the pipeline, sort of the allogeneic approaches.

Edward Tenthoff: Great. Thank you very much. Thanks for the updates on the in vivo side and all the great progress with CARVYKTI. My question has to do with the rest of the pipeline, sort of the allogeneic approaches. It really sounds like the focus is in vivo going forward. So should we be expecting updates on either some of the other autologous CAR Ts or some of the allogeneic CAR Ts in the next year or so? Can you give us a sense for when to expect those updates? Thanks.

Speaker #3: It really sounds like the focus is in vivo going forward. So, should we be expecting updates on either some of the other autologous CAR-Ts or some of the allogeneic CAR-Ts in the next year or so?

Speaker #3: Can you give us a sense for when to expect those updates? Thanks.

Speaker #4: Let me turn this over to Ying Huang to answer your question.

Alan Bash: Let me turn this over to Ying Huang to answer your question.

Speaker #6: Yes.

Edward Tenthoff: Thank you.

Speaker #3: Thank you.

Yuhong Qiu: Yes. The in vivo platform and allogeneic platform each have its strength. We prioritize in vivo, but we still believe that allogeneic have the place. We previously provided our LUCAR-G39D program in ASH last year, and we continue, we will provide additional updates in future conferences on that program.

Speaker #6: So the in vivo platform and allogeneic platform each have a strength. We prioritize in vivo, but we still believe that allogeneic have the place.

Speaker #6: We previously provided our G39D program in Ash last year. And we continue to provide additional updates in future conferences on that program.

Speaker #3: Okay. Thank you.

Edward Tenthoff: Okay. Thank you.

Speaker #2: Thank you. One moment for our next question, please. It comes from Mitchell Kapoor with HC Wainwright. Please proceed.

Operator: Thank you. One moment for our next question, please. It comes from Mitchell Kapoor with H.C. Wainwright. Please proceed.

Speaker #8: Hi. This is Ahmed Ahn from Mitchell. Congrats on the strong quarter. Just a couple of questions from us. One on how much of Carvinkti's current 12, 2, 4L mix is in 2L and 3L versus fourth line?

[Company Representative] (H.C. Wainwright): Hi, this is Amit on for Mitchell. Congrats on the strong quarter. Just a couple questions from us. One on how much of CARVYKTI's current 2L to 4L mix is in 2L and 3L versus fourth line, and how has that shifted Q over Q, and if Inotuzumab launches in fourth line, what portion of CARVYKTI's current business would face direct overlap at launch? The second one, I was wondering with Tecvayli showing clinical proof of concept and LB2102 validating DLL3 CAR activity in small cell lung cancer, how are you thinking about extending the in vivo platform into solid tumors? Would DLL3 be the logical target? Would that fall within the Novartis agreement? Thank you.

Speaker #8: And how has that shifted Q over Q? And if I need to sell launches, in fourth line, what portion of Carvinkti's current business would face direct overlap at launch?

Speaker #8: And the second one, I was wondering with Tavek showing clinical proof of concept and LB2102 validating the LL3 CAR activity in small cell lung cancer, how are you thinking about extending the in vivo platform into solid tumors?

Speaker #8: And would the LL3 be the logical target? And would that fall within the Novartis agreement? Thank you.

Speaker #4: Let me answer your second question first and just say that we're looking across a range of potential solid tumor targets. A solid tumor, obviously, has its own unique characteristics.

Alan Bash: Well, let me answer your second question first and just say that we're looking across a range of potential solid tumor targets. A solid tumor obviously has its own unique characteristics, and I think there are challenges that we and other companies are continuing to try to solve with in vivo in solid tumor. So more to come on that one. We do think that the DLL3 auto CAR T data set was meaningful. As you know, we have a partnership with Novartis where we will be having Novartis take the asset forward into full clinical development.

Speaker #4: And I think there are challenges that we and other companies are continuing to try to solve with in vivo in solid tumors. So more to come on that one.

Speaker #4: We do think that the DLL3 auto CAR-T dataset was meaningful. And as you know, we have a partnership with Novartis where we will be having Novartis take the asset forward into full clinical development.

Alan Bash: As it relates to your question about line of therapy, yes, you did hear us share an update today that our 2L through 4L now comprises 70%. In fact, over 70% of our mix in the US, and that's exciting because that means that we are making significant progress in getting CARVYKTI to be used earlier in the treatment paradigm. As you mentioned, where anito-cel will be potentially indicated in later lines, depending, of course, on what label they do receive. Our foothold in second through fourth line, I think, provides a meaningful opportunity for CARVYKTI going forward. Last quarter, we did break down and share an insight that within the 2L and 3L specifically, that that represented 41% of the overall mix.

Speaker #4: As it relates to your question about line of therapy, yes, you did hear us share a report—an update today—that second-line through fourth-line now comprises 70%.

Speaker #4: In fact, over 70% of our mix in the U.S. And that's exciting, because that means we are making significant progress in getting Carvykti to be used earlier in the treatment paradigm.

Speaker #4: And as you mentioned, where Anadiscel will potentially be indicated in later lines, depending of course on what label they do receive, our foothold in second through fourth line, I think, provides a meaningful opportunity for Carvykti going forward.

Speaker #4: We last quarter, we did break down and share an insight that within the 2L and 3L specifically, that that represented 41% of the overall mix.

Speaker #4: And we did that because we wanted to share a point-in-time reference to the fact that we've made significant growth and significant progress in early lines, specifically second line and third line.

Alan Bash: We did that because we wanted to share a point-in-time reference to the fact that we have made significant growth and significant progress in early lines, specifically 2L/3L. We said at the time, and we maintain today, we do not intend to provide that update on every single quarter. Really, it was an opportunity to share that we are growing in second, third line. It continues to be the fastest-growing part of our business, and we are excited with the fact that we do continue, both from a clinical standpoint and a commercial execution standpoint, to focus on the early line opportunities.

Speaker #4: And we said at the time, and we maintain today, we don't intend to provide that update every single quarter. Really, it is an opportunity to share that we are growing in second- and third-line.

Speaker #4: It continues to be the fastest-growing part of our business, and we're excited by the fact that we continue, both from a clinical standpoint and a commercial execution standpoint, to focus on the early line opportunities.

Speaker #8: Thank you.

[Company Representative] (H.C. Wainwright): Thank you.

Speaker #2: Thank you. Our next question comes from Ash Verma with UBS. Please proceed.

Operator: Thank you. Our next question comes from Ash Verma with UBS. Please proceed.

Ash Verma: Hi. Congrats on the progress here. Thanks for taking our questions as well. Maybe just the first one, can you talk about the potential impact on CARVYKTI from Johnson & Johnson's growing body of clinical data? We have seen this MonumenTAL-6 data that for Tecvayli showed a hazard ratio of 0.11 on PFS in second to fifth-line patients. Just help us understand. I know you are growing a lot in second to third line, but just if competition catches up to that. Secondly, I know you commented on the sequential global sales growth, but can you confirm that if it applies to the US sales growth as well going into Q3 and Q4? Thanks.

Speaker #4: Hi. Congrats on the progress here. Thanks for taking our questions as well. So maybe just the first one: can you talk about the potential impact on Carvykti from J&J's growing body of clinical data?

Speaker #4: We've seen this monumental data that Forte Quality Tauzi showed, with a ratio of 0.11 on PFS in second- to fifth-line patients. So just help us understand.

Speaker #4: I know you're growing a lot in second to third line, but just if competition catches up to that. And then secondly, you commented on the sequential global sales growth, but can you confirm that if it applies to the US sales growth as well, going into 3Q and 4Q?

Speaker #4: Thanks. Yeah. At this point, and again, we stay very close to our partner J&J here on this. So we wanted to just maintain the comment that we had previously, which is around global sequential growth.

Alan Bash: Yeah. At this point, again, we stay very close to our partner Johnson & Johnson here on this. We wanted to just maintain the comment that we had previously, which is around global sequential growth quarter on quarter. To answer your first question on the bispecifics, again, I pointed this out earlier, but I think it is important to emphasize the bispecifics do have, I think, very compelling data, but they offer a very different value proposition for patients. What we are focused on is the fact that, jointly with Johnson & Johnson, and Johnson & Johnson has reiterated the fact that CARVYKTI, even on their recent earnings call, that CARVYKTI has the potential to be a $5 billion-plus peak sales asset. We very much are in lockstep with them on that.

Speaker #4: Quarter on quarter. But to answer your first question on the bispecifics—again, I pointed this out earlier, but I think it's important to emphasize that the bispecifics do have, I think, very compelling data, but they offer a very different value proposition for patients.

Speaker #4: And what we're focused on is the fact that, and jointly with J&J and J&J has reiterated the fact that Carvinkti even on their recent earnings call, that Carvinkti has the potential to be a $5 billion plus peak sales asset.

Speaker #4: And we very much are in lockstep with them on that. Both J&J and Legend are committed to the fact that Carvykti provides a very unique value proposition to patients, to physicians, and to the market.

Alan Bash: Both Johnson & Johnson and Legend are committed to the fact that CARVYKTI provides a very unique value proposition to patients, to physicians, and to the market. One and done versus continuous therapy, the opportunity for a long-term remission, and really meeting the definition of cure as defined by the IMWG guidelines. Really, we have a potential for cure here based on the CARTITUDE-1 long-term five-year data. We look forward to presenting updates in earlier lines over the next year or so, and we do believe that this one and done opportunity with long-term remissions and the potential for cure is what patients and physicians ultimately want. I would also add to your question, which is, I mentioned it earlier, there has really been a very robust conversation now at all the medical conferences and all the follow-on conferences about sequencing.

Speaker #4: One and done versus continuous therapy, the opportunity for a long-term remission, and really meeting the definition of cure as defined by the IMWG guidelines.

Speaker #4: Really, we have a potential for cure here based on the CARTITUDE-1 long-term five-year data. We look forward to presenting updates in earlier lines over the next year or so.

Speaker #4: And we do believe that this one-and-done opportunity, with long-term remissions and the potential for cure, is what patients and physicians ultimately want.

Speaker #4: And I would also add to your question, which is, as I mentioned earlier, there's really been a very robust conversation now at all the medical conferences and all the following conferences about sequencing.

Speaker #4: And I think the real-world evidence that was presented at ASCO, whether it's the Germany registry or whether it's the Mountain West US registry from Trinetix, or whether it's other datasets, institution-specific real-world data, suggests that when patients get CAR-T first, they have prolonged survival, they have better outcomes, and you have less opportunity for antigen escape or antigen mutation.

Alan Bash: I think the real-world evidence that was presented at ASCO, whether it is the Germany registry or whether it is the Mountain West US registry from TriNetX, or whether it is other datasets, institution-specific real-world data suggests that when patients get CAR T first, they have prolonged survival, they have better outcomes, and you have less opportunity for antigen escape or antigen mutation. You really have an opportunity to get to CAR T first, and that is really where the KOLs are on this topic.

Speaker #4: So you really have an opportunity to get to CAR-T first, and that's really where the KOLs are on this topic.

Operator: We have a question from the line of Sean McCutcheon for Raymond James. Please proceed.

Speaker #2: We have a question from the line of Sean McCutcheon with Raymond James. Please proceed.

Speaker #6: Hi guys, thanks for the question. And speaking to the earlier line, with the Ivertimide/Fiducil coming up in about a week, on the MRD negativity results—how does this inform your calculus on the potential for filing on MRD for CARTITUDE-6 and accelerating the time to market for Carvykti in the frontline transplant-eligible population?

Sean McCutcheon: Hi, guys. Thanks for the question. Speaking to earlier line, with the iberdomide padufotib coming up in about a week on the MRD negativity results, how does this inform your calculus on potential for filing on MRD for CARTITUDE-6 and accelerating the time to market for CARVYKTI in the frontline transplant-eligible population? Thanks.

Speaker #6: Thanks.

Alan Bash: Let me ask Yuhong to comment about MRD as an endpoint.

Speaker #4: Let me ask you, Hung, to comment about MRD as an endpoint.

Speaker #7: Thank you. With the advancement of frontline therapies for multiple myeloma patients, the median PFS gets longer and longer, which is very good news for patients.

Yuhong Qiu: Thank you. With the advancement of frontline therapies for multiple myeloma patients, the median PFS gets longer, which is very good news for patients. But for the development newer therapies, some of those patients still relapse. So MRD become a necessary surrogate in order for those effective therapies to reach patients earlier. Although in the MRD ODAC, the correlation analysis does not include any of the CAR T datasets. We continue to work with FDA on the possibility of using MRD as a surrogate for registration purpose for the CAR T therapy. CAR-6 will continue on this effort.

Speaker #7: But for the development of newer therapies, some of those patients still relapse. So MRD becomes a necessary surrogate in order for those effective therapies to reach patients earlier.

Speaker #7: Although in the MRD ODAC, the correlation analysis does not include any of the CAR-T datasets. We continue to work with FDA on the probability of using MRD as a surrogate for restitution purposes for the CAR-T therapies so CAR 6 will continue on this effort.

Speaker #2: Thank you. And as I see no further questions in the queue, I will conclude the Q&A session and conference for today. We want to thank everyone for participating.

Operator: Thank you. As I see no further questions in the queue, I will conclude the Q&A session and conference for today. We want to thank everyone for participating, and you may now disconnect.