Q2 2019 Earnings Call

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Ladies and gentlemen, please standby your Nektar Therapeutics Q2, 2019 financial results conference call will begin momentarily. Thank you for your patience simply standby.

Operator: transcript Emily Beynon [inaudible]

Operator: Good morning, ladies and gentlemen, and welcome to the Nektar Therapeutics Q2 2019 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session, and instructions will be given at that time. If anyone should require assistance during the conference, please press star then zero on your touchtone telephone.

Jennifer Ruddock: As a reminder, this conference call may be recorded. I would now like to introduce your host for today's conference, Ms. Jennifer Ruddock, Head of Investor Relations. Madam, you may begin. Thank you, Crystal. Good afternoon, everyone, and thank you for joining us today.

Jennifer Ruddock: With us are Howard Robin, our President and CEO, Gil Labroucherie, our Chief Financial Officer, Dr. Steven Doberstein, our Head of R&D, Dr. Jonathan Zalevsky, our Chief Scientific Officer, and Dr. Mary Tagliaferri, our Chief Medical Officer. On today's call, we expect to make forward-looking statements regarding our business, including clinical trial results, timing and plans for future clinical trials, timing and plans for future clinical data presentations at medical meetings, the therapeutic potential of our drug candidates, the effects of manufacturing processes and controls, outcomes and plans for health authority regulatory actions and decisions, financial guidance, and certain other statements regarding the future of our business. Because these forward-looking statements relate to the future, they are subject to inherent uncertainties and risks that are difficult to predict, and many of which are outside of our control. Important risks and uncertainties are set forth in the Form 8K filed today and the Form 10-Q that we filed on May 9, 2019, which is available at www.sec.gov. We undertake no obligation to update any of these forward-looking statements, whether as a result of new information, future developments, or otherwise.

Good day, ladies and gentlemen, and welcome to the Nektar Therapeutics Q2, 2019 financial results Conference call.

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

Later, we will conduct a question and answer session and instructions will be given at that time, if anyone should require assistance. During the conference. Please press Star then zero on your Touchtone telephone as a reminder, this conference call may be recorded.

I would now like to introduce your host for today's conference Ms., Jennifer Ruddock head of Investor Relations Ma'am you may begin.

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

With us are Howard Robin, our president and CEO .

Howard W. Robin: A webcast of this call will be available on the Investor Relations page of Nektar's website at Nektar.com. With that, I will turn the call over to Howard. Howard?

Killebrew, Sri our Chief Financial Officer, Dr., Stephen Doberstein, our head of R&D.

Dr., Jonathan Zaleski, our Chief Scientific Officer, and Dr., Mary Mary Tyler Perry, our Chief Medical Officer.

Howard W. Robin: Good afternoon, everyone, and thank you for joining us on today's call. Today we'll review the quarterly results, provide several updates on our programs in the clinical pipeline, including a specific discussion of Nectar 214 and BEMPEG programs, and reiterate our financial guidance for 2019. I'll start with several updates on our pipeline programs. First, Nektar 181, as we previously announced in late July, the FDA issued a general advice letter, which was sent to several sponsors, including us. A letter stated that the FDA would be postponing product-specific opioid analgesic advisory committee meetings while they consider certain scientific and policy issues for the opioid class of pain treatments. This includes the advisory committee meeting originally scheduled to review Nektar 181 on August 21st. We will work with the FDA as they continue their review of our NDA. We are hopeful, based upon our interactions with the agency, that the FDA will be able to reschedule the panel before the end of the year. They have told us that they will inform us as soon as they can on the timeline for the new meeting.

On today's call, we expect to make forward looking statements regarding our business, including clinical trial results timing and plans for future clinical trial timing and plans for future clinical data presentations at medical meetings, the therapeutic potential of our drug candidates the effects of manufacturing processes and controls.

Outcomes and plans for help the word to regulatory actions and decisions.

Financial guidance and certain other statements regarding the future of our business.

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

Important risks and uncertainties are set forth in the form 8-K filed today and the Form 10-Q that we filed on May nine 2019, which is available at www Dot FCC Dot Gov.

We undertake no obligation to update any of these forward looking statements, whether as a result of new information future developments or otherwise.

A webcast of this call will be available on the IR page of Nektars website at Nektar Dot com.

With that I will turn the call over to Howard Howard.

Good afternoon, everyone and thank you for joining us on todays call today, We'll review the quarterly results provide several updates on our programs into clinical pipeline, including a specific discussion on the nektar to 14 or the Ben Peg program and reiterate our financial guidance for 2019.

Howard W. Robin: And, of course, we're disappointed in the delay, but we understand the importance of the agency taking a comprehensive view as it addresses considerations for this class of drug. The FDA has been very cooperative in the development and review of Nektar 181. We believe that Nektar 181 will be a step forward and an important building block to help address the opioid epidemic. Our NDA includes a 2200 patient and healthy volunteer data package to support its profile. We invented this product with the specific objective of helping to address the opioid crisis that plagues our country.

I'll start with several updates on our pipeline programs first Nektar 181, as we previously announced in late July the F.D.A. issued a general advice letter, which was sent to several sponsors including us.

The letter stated that the FDA would be postponing products specific opioid analgesic advisory committee meetings, well, they consider certain scientific and policy issues for the opioid class a pain treatments.

This includes the Advisory Committee meeting originally scheduled to review Nektar 181 on August 21st.

We will work with the FDA as they continue their review of our India. We're hopeful based upon our interactions with the agency that the FDA will be able to reschedule the panel before the end of the year.

Howard W. Robin: We look forward to a scientific discussion at the rescheduled advisory committee meeting and continued collaboration with the FDA team. This past quarter, we created a wholly owned subsidiary, Harris, which is preparing to launch Nektar 181 upon its potential approval. As we head toward a potential approval, our objective is to finalize a capital structure with one or more potential capital partners in order to support these activities.

Are they have told us that they would inform us as soon as they could on the timeline for the new meeting and of course, we're disappointed in the delay, but we understand the importance of the agency taking a comprehensive view as they address considerations for this class of drugs.

The FDA has been very cooperative in the development and review of Nektar 181, we believe that Nektar 181 will be a step forward in an important building block to help address the opioid epidemic or in D.A. includes a 2200 patient in healthy volunteer data package to support its profile. We invented this product with the specific objective of helping to address the opioid crisis that plagues our country.

Howard W. Robin: The goal is to introduce a different model in the pain space using a specialized medical liaison team and a small sales force. We're carefully gating our spending at each stage prior to potential FDA approval and commercial launch of Nektar 181. We continue to be very excited about the future of this novel potential. Next, I'd like to provide a brief update on Nektar 358, our T-regulatory IL-2 pathway candidate which is progressing in the clinic for treatment of autoimmune conditions. We presented our first in-human, single ascending dose study data at this past Jular Congress, which demonstrated that Nektar 358 selectively stimulates T-regulatory cells in a dose-dependent fashion. We plan to present additional data from this first trial at the American College of Rheumatology meeting later this year. The multiple ascending dose study in lupus patients is continuing, and based on its completion later this year, Lilly has plans to initiate a Phase IIb dose-ranging lupus study early next year. Lilly is also planning to start new Phase 1B studies later this year in two other autoimmune and inflammatory diseases.

We look forward to a scientific discussion that the ski rescheduled Advisory Committee meeting and continued collaboration with the FDA team.

This past quarter, we created a wholly owned subsidiary in Harris, which is preparing to launch Nektar 181 upon its potential approval.

As we head toward potential approval. Our objective is to finalize the capital structure would want a more potential capital partners in order to support these activities. The goal is to introduce a different model in the pain space using a specialized medical liaison team and a small salesforce, we're carefully gating our spending at each stage prior to potential FTC approval and commercial launch of Nektar 181, we continue to be very excited about the future for this novel potential medicine.

Next I'd like to provide a brief update on Nektar 358, Archie regulatory aisle to pathway candidate, which is advancing in the clinic for treatment of autoimmune conditions. We presented our first in human single ascending dose study data at this past you our Congress, which demonstrated the nectar threefifty eight selectively stimulates T regulatory cells in a dose dependent fashion.

We plan to present additional data from this first trial at the American College of Rheumatology meeting later this year.

Howard W. Robin: Lily and Nektar are very excited about Nektar 358 and its potential to become the first resolution therapeutic for multiple autoimmune and inflammatory conditions. Moving on to Nectar 255, our IL-15 agonist program, we're pleased to report that the IND for Nectar 255 was successfully filed with the FDA, and we're initiating our first in-human clinical trials this quarter in patients with either relapsed refractory The first studies are designed to evaluate the safety and dose schedule of Nectar 255 as monotherapy, evaluate biomarkers, and to expand into combination with an antibody that works through an ADCC mechanism. As IL-15 strongly promotes the expansion, activation, and survival of NK cells, we're excited about its potential to successfully combine with the ADCC mechanism.

The multiple ascending dose study in lupus patients is continuing and based on its completion later this year Lilly has plans to initiate a phase two b dose ranging lupus study early next year.

Well. He is also planning to start new phase one B studies later this year.

And two other autoimmune and inflammatory diseases.

Well you Nektar are very excited about Nektar 358, and its potential to become the first resolution therapeutic for multiple autoimmune and inflammatory indications.

Moving onto Nektar 255, our I O 15, an agonist program. We're pleased to report that the I.N.D. for Nektar 255 was successfully filed with the FDA and we are initiating our first in human clinical trials this quarter in patients with either relapsed refractory non hodgkin's lymphoma or multiple myeloma.

The first studies are designed to evaluate the safety and dose schedule of Nektar 350 to 55, as a monotherapy evaluate biomarkers and to expand into combination with an antibody that works through an ADCC mechanism.

Howard W. Robin: We recently entered into an agreement with Janssen in which they will study Nektar 255 in preclinical models combined with therapies in their oncology portfolio, and we will contribute Nektar 255, and Janssen will be responsible for the costs of the study. In addition, we're also planning to initiate a clinical trial for Nektar-255 in combination with CD19 CAR-T cells in patients with diffused large B-cell lymphoma This study is based on compelling preclinical data that were generated by our collaborators at the Fred Hutchinson Cancer Center, which demonstrated that Nektar-255 could enhance the persistence of CAR-T cells leading to more durable responses following CAR-T therapy in animal models.

As I O 15 strongly promotes the expansion activation and survival of NK cells were excited about its potential to successfully combine with the ADCC mechanism.

We recently entered into an agreement with Janssen in which they will study Nektar 255 in preclinical models combined with therapies in their oncology portfolio and we will contribute nektar 255, and Janssen will be responsible for the cost of the studies.

In addition, we're also planning to initiate a clinical trial for Nektar 255 in combination with Cdnineteen car T cells in patients with diffuse large b cell lymphoma.

The study is based upon the compelling preclinical data that was generated by our collaborators at the Fred Hutchinson Cancer Center, which demonstrated that Nektar 255 could enhance the persistence of car T cells, leading to more durable responses. Following car T therapy in animal models, we're planning a number of presentations for Nektar 255 at the upcoming Ash Conference later, this year, including additional data with car T therapy.

Howard W. Robin: We're planning a number of presentations for Nektar 255 at the upcoming ASH conference later this year, including additional data for CAR-T therapy. Finally, our research collaboration with Gilead on Nektar-255 is continuing nicely. They are evaluating Nektar-255 with various molecules in their portfolio in the area of virology, which is an entirely different application for this important mechanism. So we're very pleased with the progress of our IL-15. Now I'd like to discuss BEMPEG.

Finally, our research collaboration with Gilead for Nektar 255 is continuing nicely. They are evaluating nektar 255, with various molecules and their portfolio in the area of virology, which is an entirely different application for this important mechanism. So we're very pleased with the advancement of our I O 15 program.

Now I'd like to discuss the Ben Peg program.

As you know last quarter, we extended the start time for Registrational trials under the BMS collaboration by four months in order for BMS to maintain exclusivity for the indications indicated included in those Registrational trials.

Howard W. Robin: As you know, last quarter we extended the start time for registrational trials under the BMS collaboration by four months in order for BMS to maintain exclusivity for the indications indicated included in those registrational trials. We currently have four registrational trials ongoing, one in first-line melanoma, one in first-line cis-ineligible urofilial cancer, one in first-line renal cell carcinoma, and one in second-line re Over the past several months, we and BMS have been working together on our development program for registrational trials of Bempeng and Nevo in various tumor types and indications in a highly complex and changing competitive landscape for the anti-PD-1 class. As both companies have stated, BMS and Nektar have been encouraged by data in a number of tumor types from PIVOT-02, our Phase 1-2 study of the doublet of Bempeng and Nevo At the recent ASCO 2019 meeting, we reported an update from the First Line Melanoma Cohort in Pivot 02 that showed an improvement in complete response rates and deepening of responses for patients who responded to the doublet therapy, a clear benefit for these patients.

We currently have four Registrational trials ongoing one in first line melanoma.

One in first line system and that was wrong Urothelial cancer. One in first line renal cell carcinoma, and one in second line relapsed non small cell lung cancer.

Over the past several months, we and BMS had been working together on our development program of Registrational trials have been paying and nivo and various tumor types and indications in a highly complex and changing competitive landscape for the anti PD one class.

As both companies have stated BMS and Nektar have been encouraged by data in a number of tumor types from pivotal to our phase one two study of the doublet of Ben Pegging Nivo.

At the recent ASCO 2019 meeting.

We reported an update from the first line melanoma cohort and pivot to that showed an improvement in complete response rates and deepening of responses for patients who responded to the doublet therapy, a clear benefit for these patients. We recently announced that these compelling data led to a breakthrough designation from the FDA.

Howard W. Robin: We recently announced that these compelling data led to a breakthrough designation from the FDA. Notwithstanding this extremely positive development, we, like you, still have lingering questions about the softening in response rates that we observed in PIVX. In particular, if you remember back when we presented data at ASCO in 2018, many of you asked us about the softening in response rates between the first and second Fleming cohorts in melanoma and what could be the underlying cause of this. As more patient data have matured and become available over the past six months, we've continued to analyze all of the pivot cohorts closely in an effort to understand whether there was a root cause for Now, let me tell you what we've learned.

Notwithstanding this extremely positive development, we like you still have lingering questions about the softening in response rates that we observed in Pip.

In particular, if you remember back when we presented data at ASCO in 2018. Many of you asked us about the softening in response rates, which in the first and second flemming cohorts in melanoma and what could be the underlying cause of this variance.

As more patient data has matured and become available over the past six months. We've continued to analyze all of the pivot cohorts closely in an effort to understand whether there was a real close to this observation or whether it was a result of normal variability.

Now let me tell you what we've learned.

Howard W. Robin: As we've been working to finalize the manufacturing process and increase production capacity in order to supply a large-scale clinical program and validate commercial-scale manufacturing, we established all of the compendial methods that are expected in accordance with normal GMP guidance. In addition, we created new product-specific assays to be used for quality control in this scaled manufacturing process. With these new assays, we conducted a thorough characterization of all of the 22 lots of BEMPEG produced to date, including all of those which currently supply and will supply our current and future registrational studies. The characterization work from these new assays revealed that two of the earliest production batches of BEMPEG were different than the other 20 batches produced. These two early manufacturing lots are known as Lots 2 and 5, and at the time of their production, beginning in 2016. It was early on in the manufacturing campaign, and these lots were within the manufacturing controls and release specifications. As such, we did not detect any meaningful variability upon their release.

As we have been working to finalize the manufacturing process and increased production capacity in order to supply a large scale clinical program and validate commercial scale manufacturing, we established all of the compendium methods that are expected in accordance with normal GMP guidance.

In addition, we created new product specific assays to be used for quality control in this scaled manufacturing process with these new essays, we conducted a thorough characterization of all of the 22 lots of Ben Peg produced to date, including all of those which currently supply and will supply our current and future Registrational studies.

The characterization work from these new assays revealed that two of the earliest production batches of Mpeg were different than the other 20 batches produced.

These two early manufacturing lots are known as lots two and five.

And at the time of their production bidding beginning in 2016.

It was early on in the manufacturing campaign and these lots were within the manufacturing controls and release specifications as such we did not detect any meaningful variability upon their release.

Various early production batches of Ben Peg were sequentially distributed and pivot O two lots 123 and five.

Howard W. Robin: Various early production batches of BEMPEG were sequentially distributed in PivotO2, Lots 1, 2, 3, and 5, as more clinical data matured and became available in PivotO2, and once we had identified the outlier variances of LOTS 2 and 5, we then had the basis to start analyzing any potential differences between data from patients that started treatment with LOTS 1 and 3 as compared to LOTS 2 and 5. We found notable correlations in several cohorts with evidence of an improved clinical benefit in patients who started treatment with LOTS 1 and 3 as compared to patients who started treatment with LOTS 2 and 5. We have identified the cause of the physical differences between these lots, which we now know stem from a single suboptimal batch of in-process intermediate that was used to produce only these two lots, Lots 2 and 5, of the 22 lots we've made to date.

As more clinical data mature it and became available in pivotal too and once we had identified the outlier variances of lots to in five.

We then had the basis to start analyzing any potential differences between data from patients that started treatment with lots more than three.

As compared to lots two and five.

We found notable correlations in several cohorts with evidence of an improved clinical benefit in patients who started treatment with lots more than three as compared to patients who started treatment with lots to in five.

We have identified the cause of the physical differences between these lots, which we now know stemmed from a single sub optimal batch of in process intermediate that was used to produce only these two lots lots two in five of the 22 lots we've made to date.

Howard W. Robin: The issue is restricted only to the single batch of intermediate used in lots 2 and 5, and importantly, our recently developed product assays show that fortunately, the rest of the BEDPAK batches that have been produced have characterization profiles comparable to lots 1 and 3. Lot 2 had already been fully used in Pivot, and Lot 5 was almost fully utilized in Pivot and Propel.

The issue is restricted only to the single batch of intermediate used in wants to and five and importantly, our recently developed product the assays show that Fortunately the rest of the bed peg batches that had been produced have characterization profiles comparable to lots one in three.

Lot to it already been fully used in pivot and left five was almost fully utilizing pivot and propel.

Howard W. Robin: No material from lot two or five is currently being used in any of the ongoing clinical trials, and this material has not been used at all in any of the ongoing registrations. As a result of this discovery, we have developed a comprehensive control strategy to limit variances in raw materials, intermediates, and the final product in our manufacturing, and this is being validated for commercial-scale manufacturing. This has been submitted to and accepted by FDA in collaboration with BMS. The new assays and control strategies also allow us to build new IP around them. In addition, as we were scaling up manufacturing, we also changed the structure of our CMC organization in terms of leadership and alignment of skills and activities. Supply chain and manufacturing are now being run with new leadership under Kevin Brobeck, who has successfully led our manufacturing activities for other programs with partners from development through commercialization, and Biologics Process Sciences is now reporting to our Chief Scientific Officer, Dr. Jonathan Zalevsky, as his team has deep subject matter expertise in this area.

No material from one two or five is currently being used in any of the ongoing clinical trials and this material has not been used at all in any of the ongoing registrational trials.

As a result of this discovery, we have developed a comprehensive control strategy to limit variances in raw materials intermediates and the final product in our manufacturing and this is being validated for commercial scale manufacturing.

This has been submitted to and accepted by the FDA in collaboration with BMS.

The new assays and control strategies also allow us to build new IP around the product.

In addition, as we we're scaling up manufacturing we also changed the structure of our CMC organization in terms of leadership and alignment of skills and activities supply chain and manufacturing are now being run with new leadership under Kevin Brobeck was successfully led our manufacturing activities for other programs with partners from development through commercialization.

And biologics process Sciences is now reporting to our Chief Scientific Officer Dr., Jonathan Zalevsky as his team has deep subject matter in this area.

I'll now turn the call to Steve Doberstein to comment on some additional detail with respect to the clinical differences based on the drug lots we observed in pivot as little as these correlations are to us and BMS. They of course cannot be used to determine causality.

Howard W. Robin: I'll now turn the call over to Steve Doberstein to comment on some additional detail with respect to the clinical differences based on the drug lots we observed in PIVOT. As notable as these correlations are to us in BMS, they, of course, cannot be used to determine causality. These clinical differences between lots were also shared with the FDA as part of their review of our control strategy.

These clinical differences between lots were also shared with the FDA as part of the review of our control strategy Steve.

Steve Doberstein: Steve? Thank you, Howard.

Steve Doberstein: Thank you, Howard. First, I'd like to outline how we analyzed differences in clinical performance between the lots. The majority of patients in PivotO2 rotated through different lots beyond cycle three of their treatment, so we focused our analyses on clinical differences based on the starting lots that a patient received.

Thank you Howard.

First I'd like to outline how we analyze differences from the clinical performance between the lots the majority of patients in pivotal to rotated through different lots beyond cycle three of their treatment. So we focused our analyses on clinical differences based on the starting lots that a patient received.

Steve Doberstein: As of mid-May, approximately half of the patients in PIVOT began treatment with LOTS 1 and 3, and half began treatment with LOTS 2 and 5. We looked at differences in safety, first scan response, and best objective response rate, including complete response rate. In the particular cohorts of first-line melanoma, first-line renal cell carcinoma, and first-line urothelial carcinoma, we saw a correlation between improved clinical benefit and those patients who received lots one or three for their first dose as compared to those who received lots two or five for their first dose. This trend of improved clinical benefit was maintained even when analyzing these metrics by patient demographics, baseline disease criteria, or investigator sites. Given that the usage of the suboptimal in-process intermediate was limited to only lots two and five, we combined the data for patients initially dosed with either lots two or five together, and we combined the data for patients who started with in-trend lots one or three together. First, let's start with safety.

As of mid May approximately half of the patients and pivot began treatment with lots one in three and a half began treatment with lots two and five.

We looked at differences in safety first scan response, and best objective response rate, including complete response rate.

In a particular cohorts of first line melanoma first line renal cell carcinoma, and first line Urothelial carcinoma.

We saw a correlation between improved clinical benefit and those patients who received lots Warner three for their first dose as compared to those who receive lots two or five for their first dose.

This trend of improved clinical benefit was maintained even when analyzing these metrics by patient demographics.

Baseline disease criteria or investigator sites.

Given that the usage of the sub optimal in process intermediate was limited to only lots two and five we combined the data for patients initially dosed with either watch two or five together.

When we combine the data for patients who started with in trend lots, one or three together.

First let's start with safety.

Steve Doberstein: We observed no meaningful differences in safety between Lots 1 and 3 and Lots 2 and 5, although some minor differences were observed, and a directional trend towards more reported adverse events did occur with Lots 1 and 3. Overall, the safety profile of the doublet continues to be well tolerated and is consistent with our prior data presentations, although starting now with the First Line Melanoma Cohort. As you recall, the best objective response rate as reported at ASCO 2019 for efficacy of valuable patients was 53%, with a complete response rate of 34%. In addition, 42% of patients achieved a 100% reduction in their target. All 10 patients who were on treatment at the time of ASCO 2019 remain on treatment today or have achieved maximal clinical benefit in the study, as Howard stated. These data recently led to a breakthrough designation in first-line melanoma.

We observed no meaningful differences in safety between lots one in three and lots two and five although some minor differences were observed at a directional trend towards more reported a ease did occur with lots one in three.

Overall, the safety profile of the doublet continues to be well tolerated and is consistent with our prior prior data presentations.

Starting now with the first line melanoma cohort as you'll recall the best objective response rate as reported ASCO 2019 for efficacy Evaluable patients was 53% with a complete response rate of 34%. In addition, 42% of patients who achieved 100% reduction in their target lesions.

All 10 patients who were on treatment at the time of ASCO 2019 remain on treatment today or have achieved maximal clinical benefit in the study.

As Howard stated.

These data recently led to a breakthrough designation in first line melanoma.

Notably when you analyze this cohorts by combined lots for the 16 patients who started on lots one and three the response rate at first scan was 56%.

Steve Doberstein: Notably, when you analyze this cohort by combined lots, for the 16 patients who started on Lots 1 and 3, the response rate at first scan was 56%. The response rate at first scan for the 22 patients who started on lots two and five was only 18 percent. The Best Objective Response Rate for Lots 1 and 3, with 75% and a complete response rate of 44%. For Lots 2 and 5, the best objective response rate was 36%, with a complete response rate of only 27%. As you would imagine, these response differences also led to an improvement in PFS seen between the lots.

The response rate at first scan for the 22 patients who started on lots two and five was only 18%.

The best objective response rate for lots one in three.

With 75% with a complete response rate of 44%.

For lots two and five the best objective response rate was 36% with a complete response rate of only 27%.

As you'd imagine. These response differences also lead to an improvement in PFS seen between the lots.

Steve Doberstein: You'll recall that the overall patient population was at a median 12.7-month follow-up at ASCO 2019, and the median PFS was at a minimum of 12.7 months. However, when you break out those patients who started on lots 1 and 3, median PFS can't yet be estimated because there are too few events of progressive disease. However, for patients who started on LOTS 2 and 5, median PFS was estimated at 5.2 months and is reflected in the minimum median PFS of 12.7 months for the overall cohort. Notably, 41% of the 22 patients who started on LOTS 2 and 5 experienced progressive disease at first scan. In the first line urothelial cancer cohort, we now have 37 patients of value for efficacy by investigator.

You'll recall that the overall patient population was it a median 12.7 month follow up at ASCO 2019, and the median PFS was at a minimum of 12.7 months.

When you break out those patients who started on lot. One in three median PFS can't yet the estimated because there are too few events and progressive disease.

However for patients who started on lots two and five median PFS is estimated at 5.2 months and is reflected in the minimum median PFS of 12.7 months for the overall cohort.

Notably 41% of the 22 patients who started on March two and five experienced progressive disease that for scam.

In the first line Urothelial cancer cohort, we now have 37 patients evaluable for efficacy by investigator and we plan to present. These data for this cohort at a future medical meeting.

Steve Doberstein: And we plan to present these data for this cohort at a future medical meeting. Since we first presented our urothelial cancer data at ASCO-GU, unfortunately, 80% of new patient enrollments started treatments on lots 2 and 5. Currently, the best ORR for the entire cohort is 38%, with a complete response rate of 14%. There are still 13 patients with treatment ongoing in this cohort. Of these, five have experienced complete responses, and an additional five more patients could see further deepening of responses. There are also four patients who are being treated beyond progression. When you analyze these data by lots, for the 12 patients who started on Lots 1 and 3, the response at first scan was 42%. The response at first scan of the 25 patients who started on Lots 2 and 5 was 32%.

Since we first presented our Urothelial cancer data at ASCO GI you. Unfortunately, 80% of new patient enrollments started treatments on lots two and five.

Currently the best are for the entire cohort is 38% with a complete response rate of 14%.

There are still 13 patients with treatment ongoing in this cohort of these five have experienced complete responses and an additional five more patients could see further deepening of response there also for patients who are being treated beyond progression.

When you analyze these data by lots for the 12 patients who started on lots one in three response at first scan was 42%. The response at first scan of the 25 patients who started on line two and five was 32%.

For patients who started on lots one and three the best objective response rate was 50% with a complete response rate of 42%.

Steve Doberstein: For patients who started on LOTS 1 and 3, the best objective response rate was 50%, with a complete response rate of 42%. For patients who started on LOTS 2 and 5, the best objective response rate was only 32%, and none of these patients had a complete response. These response differences also led to an improvement in PFS for patients who started on lots one and three. PFS for the urophilial cohort is quite immature, but can be estimated at 4.1 months for the entire cohort.

For patients who started on lot two and five the best objective response rate was only 32% and none of these patients had a complete response.

These response differences also led to an improvement in PFS for patients who started on March one and three.

PFS for the Urothelial cohort is quite immature.

That can be estimated at 4.1 months for the entire cohort, but when you examine by starting a lot for patients who started on last one in three median PFS can be estimated at 5.5 months and for patients who started on lots two and five median PFS is estimated at only 3.5 months.

Steve Doberstein: But when you examine by starting lot, for patients who started on lots one and three, the median PFS can be estimated at 5.5 months, and for patients who started on lots two and five, the median PFS is estimated at only 3.5 months. In the first-line renal cell carcinoma cohort, we currently have 49 patients evaluable for efficacy by investigators. Currently, the best ORR for the whole cohort is 35%, with a complete response

In the first line renal cell carcinoma cohort. We currently have 49 patients evaluable for efficacy by investigator.

Currently the best or for the whole cohort is 35% with a complete response rate of 4%.

Steve Doberstein: 11 patients remain on treatment in the RCC cohort. When you examine clinical performance by lot, for the 25 patients who started on lots one and three, the response at first scan was 20%. For the 24 patients who started on lots two and five, the response at first scan was only 4%. The best objective response rate was 40% for patients starting on Lots 1 and 3, as compared to a best objective response rate of 29% for Lots 2 and 5. The median PFS is quite immature for the whole cohort but is estimated at 7.6 months.

11 patients remain on treatment in the RCC cohort.

When you examine clinical performance by lot for the 25 patients who started on lots one and three the response at first scan was 20%.

For the 24 patients who started on lots two and five the response at first scan was only 4%.

The best objective response rate was 40% for patients starting on last one in three as compared to a best objective response rate of 29% for lots two and five.

Median PFS is quite immature for the whole cohort, but is estimated at 7.6 months.

Steve Doberstein: When you analyze by lots for this cohort, the median PFS for patients who started on lot one and three was 11.2 months, and the median PFS for patients who started on lot two and five was only 5.5 months. In first-line non-small cell lung cancer, when we examine the first scan depth of tumor reduction split by LOTS, there is some early evidence that the 16 patients who started on LOTS 1 and 3 are experiencing a greater reduction in their target lesions than the 13 patients who started on LOTS 2 and 5. However, the data are very immature in this cohort, and we'll continue to monitor whether this trend continues as data mature and as more patients are enrolled in other cohorts and pivot beyond the ones I've just described.

When you analyze buy lots for this cohort median PFS for patients who started on lot. One in three was only was 11.2 months and median PFS for patients who start on lot two and five was only 5.5 months.

In first line non small cell lung cancer. When we examined the first scan depth of tumor reduction split by lots. There is some early evidence that the 16 patients who started on lots one and three are experiencing a greater reduction in their target lesions than the 13 patients who started on lots two and five however, the data are very immature in this cohort and we'll continue to monitor whether this trend continues as data mature and as more patients are enrolled.

In other cohorts and pivot beyond the ones I've just described.

Steve Doberstein: We did observe some clinical differences between patients who started on different lots, but the differences were not as notable as they were in the other first-line settings. As of the May 17th data cut, we did not meet the Fleming thresholds for the response rates for relapsed or refractory settings in PivotO2, and this has made it more difficult to discern any differences in these cohorts. However, there are similarities.

We did observe some clinical differences between patients who started on different lots. However, the differences were not as notable as they were in the other first line settings.

As of the May 17th data cut we did not meet the flemming thresholds for the response rates for relapsed or refractory settings in pivotal too and this has made it more difficult to discern any differences in these cohorts.

However, there are similarities for example.

Steve Doberstein: For example, in the cohorts of second and third line non-smell cell lung cancer, the few responses we observed were in patients who started on lots one and three. In the second-line IO-Naive RCC cohort, over half the patients who started on Lots 2 and 5 had progressive disease at first scan, as compared to only 16% who started on Lots 1 and 3. Before I hand the call back to Howard, I'd like to briefly comment on planned data presentations for the rest of the year.

And the cohorts of second and third line non small cell lung cancer. The few responses. We observed were in patients who started on lots one in three.

In the second line Io naive RCC cohort over half the patients who started on lots two in five had progressive disease at first scan as compared to only 16% who started on lots one of the three.

Before I hand, the call back to Howard I'd like to briefly comment on plan data presentations for the rest of the year.

Steve Doberstein: First in Melanoma. Despite the differences between patients who started treatment with Lot 2 and 5 and PivotO2, we're pleased with the ongoing deepening of responses we've reported in the first-line melanoma cohort. We and BMS have submitted an abstract to present updated 18-month follow-up data at the 2019 CITSE meeting. Second, in triple negative breast cancer, we have submitted an abstract to the upcoming CRI quadruplet meeting for this cohort. We intend to hold a webcast with a leading breast cancer expert to review these data during that meeting. 3rd RCC

First in melanoma.

Despite the differences between patients who started treatment with lot two in five and pivotal to we're pleased with the ongoing deepening of responses. We've reported in first line melanoma cohort.

We and BMS has submitted an abstract to present updated 18 month follow up data at the 2019 City meeting.

Second in Triple negative breast cancer, we have submitted an abstract to the upcoming CCRI quadrupling meeting for this cohort we intend to hold a webcast with a leading breast cancer experts to review these data during that meeting.

Third RCC.

Steve Doberstein: We are planning to submit these data from this cohort for possible presentation at ESMO-IO in December. Fourth, non-small cell lung cancer In January of this year, at the time of the J.P. Morgan Conference, we had 10 patients evaluable for efficacy with varying PD-L1 status across all three of our first-line non-small-cell lung cancer PD-L1 expression sub-cohorts. However, enrollment has been slower than we anticipated in these cohorts, and there are a number of patients who were enrolled more recently in the second and third quarter

We are planning to submit these data from this cohort for possible presentation at ESMO Io in December .

Fourth non small cell lung cancer.

In January of this year at the time of the JP Morgan Conference. We had 10 patients evaluable for efficacy with varying PDL one status across all three of our first line non small cell lung cancer PDL, one expression sub cohorts.

Enrollment has been slower than we anticipated in these cohorts and there are a number of patients who were enrolled more recently in the second and third quarters.

Steve Doberstein: Overall, the early data we're observing in these few patients in the first line non-small cell lung cancer sub-cohorts support the BEMPEG mechanism of action and its potential benefit in the below 50% PD-L1 expressors and in the PD-L1 negative baseline patients. As you know, we've reported that effect in other tumor types as well. In the greater than 50% PD-L1 expression sub-cohort, we haven't seen this same benefit, and we're trying to understand this observation in light of the manufacturing issue.

Overall, the early data we are observing in these few patients in the first line non small cell lung cancer cut sub cohorts support the Ben Peg mechanism of action and its potential benefit in the below 50% PDL, one expressers and in the PDL one negative baseline patients as you know we've reported that effect in other tumor types as well.

In the greater than 50% PDL, one expression sub cohort we haven't seen this same benefit and we're trying to understand this observation in light of the manufacturing issue.

Steve Doberstein: As I just stated, when we examine the depth of tumor reduction by LOTS, there is some early evidence that patients may benefit more when started on LOTS 1 and 3. We're enrolling additional patients in the first line non-small cell lung cancer cohorts, and those patients are starting treatment with Benpeg LOTS that are not LOTS 2 and 5. As a result of the current immaturity of the data and the desire to continue to enroll more first-line non-small cell lung cancer patients, we withdrew our accepted abstract for the upcoming ESMO meeting. We plan to present these first-line non-small cell lung cancer cohorts once the data are more mature. As you'll recall, our PROPEL study was designed to be a dose-finding phase 1 trial to evaluate pembrolizumab in combination with BEMPAG in non-small cell lung cancer and other tumor types. As Howard stated earlier, Lot 5 was almost fully utilized and propelled.

As I just stated when we examine the depth of tumor reduction by lots. There is some early evidence that patients may be benefiting more when started on lots one in three.

We're enrolling additional patients in the first line non small cell lung cancer cohorts and those patients are starting treatment with Ben peg lots that are not lots two and five.

As a result of the current immaturity of the data and the desire to continue to enroll more first line non small cell lung cancer patients. We withdrew our accepted abstract for the upcoming ESMO meeting we plan to present. These first line non small cell lung cancer cohorts once the data are more mature.

As you'll recall.

Our propel study was designed to be a dose finding phase one trial to evaluate pembrolizumab in combination with Ben Pag Bend peg in non small cell lung cancer and other tumor types.

As Howard stated earlier lot five was almost fully utilized and propel.

Steve Doberstein: Now the patients are starting on different BEMPEG lots in Propel. We plan to focus on enrolling first-line non-small-cell lung cancer patients into Propel, and we're also evaluating different dose levels of BEMPEG in non-small-cell lung cancer to ensure dose optimization. This will allow us to generate important data in first-line non-small cell lung cancer with the PEMBRO and BEMPEG doublets, with respect to additional trials starting with other collaborators and vendors. Pfizer and Nectar have finalized the Phase 1B2 study in head and neck cancer and castration-resistant prostate cancer. This study will be initiated imminently and will evaluate various doublet and triplet combinations with BEMPEG and Pfizer and Merck-Soronos anti-PD-L1 patient avilumab, Pfizer's PARP inhibitor, talazoparib, and Pfizer and Astellas' enzalutamide. We're very excited to work with Pfizer on this because of the opportunity in these two solid tumor settings for BEMPEG, particularly in patients with PD-L1 negative tumors. With that, I'll turn the call back over to Howard.

Now the patients are starting on different then peg Watson propel we plan to focus on enrolling first line non small cell lung cancer patients into propel and we're also evaluating different dose levels of Ben peg in non small cell lung cancer to ensure dose optimization.

This will allow us to generate important data in first line non small cell lung cancer with the Pembro and Ben Peg doublet.

With respect to additional trials, starting with other collaborators and Ben Peg Pfizer and Nektar have finalized the phase one b two study in head and neck cancer and castration resistant prostate cancer.

This study will be initiating imminently.

And we will evaluate various doublet and triplet combination with Mpeg and Pfizer and Merck Seronos anti PD L. One patient Avila Mab.

Pfizer's PARP inhibitor tell is operated and Pfizer and establishes enzalutamide side.

We're very excited to work with Pfizer on this because the opportunity in these two solid tumor settings for Ben peg, particularly in patients that with PDL one negative tumors.

With that I will turn the call back over to Howard.

Yes.

Howard W. Robin: Of course, we're very disappointed to have discovered this historical problem in the

Ladies and gentlemen, please standby.

Pardon me you May proceed.

Operator: Ladies and gentlemen, please stand by. Pardon me, you may proceed.

Sorry, we got cut off for a moment.

Howard W. Robin: Sorry, we got cut off for a moment. Thanks, Steve.

Thanks, Steve.

Howard W. Robin: Of course, look, we're disappointed to have discovered this historical problem with these early manufacturing lots, but we believe we've identified and developed solutions to these issues, and we now believe we have the right drug product to support the registrational trials. We and BMS are working together to ensure consistent and comprehensive quality control is implemented for commercial scale manufacturing of BEM. Nektar and BMS have also been in regular dialogue over the past few weeks regarding the development program. BMS has communicated to us that it remains very committed to the BEMPEG development program, particularly in light of the recent breakthrough designation in melanoma and the tremendous opportunity for both companies. They are highly committed to the ongoing registrational trials on first-line melanoma, first-line urothelial cancer, and first-line renal cell carcinoma, as well as our new expansion cohort of second-line non-small cell lung cancer patients in PIVX.

Of course look we're disappointed to have discovered this historical problem with these early manufacturing lots, but we believe we've identified and developed solutions to these issues and we now believe we have the right drug product to support the Registrational trials.

We and BMS are working together to ensure a consistent and comprehensive quality control is implemented for commercial scale manufacturing for Ben Peg.

Nektar and BMS have also been in regular dialogue over the past few weeks regarding the development program.

BMS has communicated to us that they remain very committed to the bend beg development program, particularly in light of the recent breakthrough designation in melanoma and the tremendous opportunity for both companies. They are highly committed to the ongoing registrational trials in first line melanoma first line Urothelial cancer, and first line renal cell carcinoma, as well as our new expansion cohort of second line non small cell lung cancer patients and pivot.

Howard W. Robin: Additional trials with BMS are under discussion and being planned. Where it makes sense, based upon supportive pivot data or existing standard of care in a tumor setting, we in BMS plan to focus on five or six key registrational trials that will clearly demonstrate the clinical benefit of BEMPEG and NEVA, and certain other trials and indications we may do in partnership with other collaborators. As part of this, we will be carefully evaluating the timing and allocation of our resources as we finalize details of the overall BEMPEG program. We are in a very fortunate position with a strong balance sheet. However, we're going to be prudent in our capital allocation plans and the objective of getting BEMPEG approved as quickly as possible and advancing our pipeline with the resources on hand.

Additional trials with BMS are under discussion and being planned where it makes sense based upon supported pivot data or existing standard of care in a tumor setting we and BMS plan to focus on five or six key registrational trials that will clearly demonstrate the clinical benefit of Ben Peg and Nivo.

Certain other trials in indications, we may do in partnership with other collaborators.

As part of this we will be carefully evaluating the timing and allocation of our resources as we finalize details of the overall Ben Peg program.

We are in a very poor fortunate position with a strong balance sheet. However, we're going to be prudent in our capital allocation plans.

And the objective of getting Ben Peg approved as quickly as possible and advancing our pipeline with the resources on hand.

And with that I'll hand, the call his call over to Gil to review our financial guidance for 2019.

Gil: Thank you, Howard, and good afternoon, everyone. Today, we issued our financial results press release for the quarter ended June 30, 2019. I will briefly review our updated 2019 financial guidance. Starting with our cash position, we anticipate ending 2019 with at least $1.5 billion of cash and investments. Our full-year GAAP revenue guidance remains at between $100 to $110 million. For GAAP expense guidance, we now anticipate 2019 GAAP R&D expense will range between $475 and $500 million, which includes approximately $80 million of non-cash depreciation and stock compensation expense. G&A expense for 2019 is still projected to be between $110 and $120 million, which includes approximately $35 million of non-cash depreciation and stock compensation expense. We continue to invest in activities necessary to support regulatory approval of Nektar 181, and as Howard discussed earlier, we are carefully staging our investment in commercial readiness for Nektar 181 as we approach a potential approval later this year. And with that, I will open the call for questions, Operator.

Thank you Howard and good afternoon, everyone. Today, we issued our financial results press release for the quarter ended June 32019, I will briefly review our updated 2019 financial guidance.

Starting with our cash position, we anticipate ending 2019 with at least 1.5 billion of cash and investments.

Our full year GAAP revenue guidance remains at between 110 between $100 million to $110 million.

For GAAP expense guidance, we now anticipate 2019, GAAP R&D expense will range between 475, and 500 million, which includes approximately $80 million of noncash depreciation and stock compensation expense.

DNA expense for 2019 is still projected to be between 110 and $120 million.

Which includes approximately $35 million of noncash depreciation and stock compensation expense.

We continue to invest in activities necessary to support regulatory approval of Nektar 181, and as Howard discussed earlier, we are carefully staging our investment in commercial readiness for Nektar one anyone as we approach a potential approval later this year.

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

Operator: Thank you. Ladies and gentlemen, if you have a question at this time, please press the star followed by the number one key on your touchtone telephone. If your question has been answered or you wish to remove yourself from the queue, please press the pound key. Once again, to ask a question, please press star and then one now. And our first question comes from Chris Shibutani from Cowan. Your line is open.

Thank you.

Ladies and gentlemen, if you have a question at this time. Please press the star followed by the number one key on your Touchtone telephone.

If your question has been answered or you wish to remove yourself from the queue. Please press the pound key once again to ask a question. Please press star and then one now.

And our first question comes from Chris Shibutani from Cowen Your line is open.

Chris Shibutani: Great, thank you very much. There is a lot of information packed in there, a fair amount to digest. Just trying to figure out what the right sequence of questions is, and I'm sure many of my colleagues will follow as well. To make clear, you said that your analysis was that it was the initial dose from the lots that were problematic that was associated with the differences in response rates and clinical response that you were measuring. Mechanistically, can you explain why that would be the case?

Great. Thank you very much a lot of information packed in their fair amount to digest.

Just trying to figure out what the right sequence and questions and I'm sure May my colleagues will follow as well but.

Can make clear you said that your analysis was that it was the initial dose.

From the lots that were problematic.

That were associated with.

The differences in response rate and clinical response that you are measuring.

Mechanistically can you explain why that would be the case.

Steve Doberstein: My second question relates to the Bristol collaboration. You had previously disclosed that the timeline had been extended to the end of September to make commitments. Is that still the case, and are you firm that whatever... programs get extended or commenced by the end of September, that will be the time point at which you would then proceed to make decisions, potentially with other collaborators? Thanks very much.

My second question relates to the Bristol collaboration.

You had previously disclosed that the timeline has been extended to the end of September to make commitments.

Is that still the case and are you from that whatever.

Programs get extended.

Our commenced by the end of September that will be the time point at which you would then proceed to making decisions potentially with other collaborators thanks very much.

Yes, Thanks, Chris This is Steve.

Howard W. Robin: Yeah, thanks, Chris. This is Steve.

With respect to the analysis that we did one of the things that confounds analysis and makes it very difficult is that as we indicated patients go. After the first couple of doses patients tend to rotate on and off different batches. We don't you know it's not like one patient gets the same batch all the way through their treatment.

Steve Doberstein: With respect to the analysis that we did, one of the things that confounds the analysis and makes it very difficult is that, as we indicated, patients go after the first couple of doses; patients tend to rotate on and off different batches. We don't, you know; it's not like one patient gets the same batch all the way through their treatment. And so what that means is that it's actually quite a bit more difficult to see the kinds of correlations that we've seen here. So I think, rather than being a mechanistic explanation, although there may be an underlying biological mechanism for it, I think it's more likely that we see the correlations simply because the numbers of patients that are pure patients that have only seen one particular batch throughout their treatment course diminishes over time quite rapidly. And by the time you get to about the third dose, almost everybody has gotten multiple doses at that point in time.

And so what that means is that it's actually.

Quite a bit more difficult to see the kinds of of correlations that we've seen here, so I think rather than being a mechanistic.

Explanation, although there may be an underlying biological mechanism for it I think it's more likely that we see the correlations simply because the numbers of patients that are.

Pure patients said I've only seen one particular batch throughout their treatment course diminishes over time quite rapidly and by the time you get to about the third dose almost everybody has got multiple batches at that at that point in time.

Steve Doberstein: I am Howard. Let me answer your question about BMS. Look, clearly, As you develop a program that has this type of magnitude, you have to look very carefully at the landscape. The landscape for PD-1 agents has clearly evolved and changed, and we're looking at that carefully with BMS, seeing where it makes most sense to develop NEVO and BEMPEG. And in addition, clearly, we had a delay here because of, you know, these manufacturing lots that we recently correlated with clinical data. And to that end, I'm not going to be very specific on whether it's a September date or an October date or this month's date. I think that probably isn't terribly relevant right now.

As Howard Let me answer your question about on BMS look.

Clearly.

As you develop a program that has this type of magnitude you have to look very carefully at the landscape and the landscape for.

PD one agents has clearly evolved and changed and we're looking at that carefully would be as seeing where it makes most sense to develop nivo and Ben Peg and in addition, clearly we had to delay here because of you know these manufacturing lots that we recently.

Correlated with clinical data and to that end.

I'm not going to be very specific on whether its a September date or an October date, or this month day, I think that probably isn't terribly relevant right now like what I said was that together we have three trials three registrational trials very large trials already running.

Howard W. Robin: What I said was that together, we have three trials, three registrational trials, very large trials already running, and we're planning on doing a number of additional trials. And to the extent that we evaluate the landscape and determine that it isn't worth pursuing a specific indication, then Nektar will be free to pursue that with other agents. And whether that's a definitive cutoff by the end of September, that's probably not terribly relevant. I can tell you that those types of decisions will be made in the very, very near future, and we'll be announcing our plan to move forward.

We are planning on doing a number of additional trials.

And to the extent that we evaluate the landscape and determined that it isn't worth pursuing a specific indication then nektar will be free to pursue that.

With with other agents and whether whether that's a definitive cut off by the end of September that's probably not terribly relevant I can tell you that those types of decisions will be made in the very very near future and we will be announcing our plan to move forward.

Jonathan Zalevsky: And then, sorry, can I just... I want to ask, is there a way to translate the difference between batches 2 and 5 to some other characteristic of the final drug product? Would you say that the shortcomings... in batches two and five were related to decreased potency? Is there some change in the depegylation rate that would have raised some questions about the bioavailability of IL-2? Can you link the two together at all?

And then sorry can I just.

Asking is there a way the difference in the batches two and five.

To translate that over to some of the characteristics of the final drug product would you say that the shortcomings.

In batches, two and five were related to decreased potency is there some change in the deep tabulation rate that would have made some question a bioavailability aisle to can you link the two together at all.

Hey, Chris can you hear me this is Jonathan Zaleski.

Jonathan Zalevsky: Hey Chris, can you hear me? This is Jonathan Zalevsky. Yeah, hey JV. Yeah, hey there.

Yes, Hey, Debbie.

Yes, Hey, there yeah. So yeah, well we have done is we have looked at the kind of physical differences between the different batches and as you remember we published a model that described how receptor bias and receptor occupancy.

Jonathan Zalevsky: Yeah, so yeah, what we have done is we have looked at the kind of physical differences between the different batches. And as you remember, we published a model that described how receptor bias and receptor occupancy arise from BEMPEG, the drug. This was in our PLOS publication a few years ago, so we were able to use that model, and we did identify that the characteristics of these batches, two and five, would make them less effective at occupying the receptor in the same way as we reported in that paper, and so they would arise with less bias. That's one of the things that we've learned.

Arises from Empaque the drug this within our plus publication a few years ago. So we were able to use that model and we did identify that the characteristics of these batches two and five would make them less effective at occupying the receptor in the same way as Weve reported in that paper and so they would arise and less bias. That's one of the things that we've learned.

Chris Shibutani: Okay, thanks. I'll behave and get back in the queue. I'm sure there are plenty of other related questions. Thank you.

Okay, Thanks, I'll behave and get back in the queue I'm sure plenty of other related questions. Thank you.

Thank you.

Jessica Macomber Fye: Our next question comes from Jessica Fye from J.P. Morgan. Your line is open. Great. Good afternoon. Thanks for taking my questions. From a development plan standpoint, you mentioned that you and Bristol plan to focus on five or six key registrational trials, and you outlined four at the beginning of the call, between first-line melanoma, first-line cystinoligible UC, second-line non-small cell, and first-line renal. Can you help us think about what other settings those one to two other registrational trials might be in?

Our next question comes from Jessica Fye from JP Morgan Your line is open.

Great and good afternoon, thanks for taking my questions.

From a development plan standpoint, you mentioned that you in Bristol plan focused on five or six key Registrational trials and you outlined for at the beginning of the call between first line melanoma first alliances knowledgeable you see second line non small cell on first line renal can you help us think about what other settings.

There was one to two other registrational trials might be in.

Sure Jessica I think look obviously, we're evaluating how we want to proceed forward in first line non small cell lung cancer and like I said, we're we're already running those trials in the propel study with Pembro, but we're certainly evaluating whether BMS and nektar one to move forward in that area and I know they have a high level of interest in that and then there might be one or two other trials, we look at in bladder cancer and melanoma I think there is a number of possibilities, let's just say this.

Howard W. Robin: Sure, Jessica. I think, look, obviously, we're evaluating how we want to proceed forward with first-line non-small cell lung cancer. And like I said, we're already running those trials in the PROPEL study with PEMBRO, but we are certainly evaluating whether BMS and Nektar want to move forward in that area. And I know they have a high level of interest in that. And there might be one or two other trials we look at in bladder cancer and in melanoma. I think there are a number of possibilities. Let's just say this. If we get, and I believe we will, have six major registrational trials running in six different indications with BMS, I do believe that's a good way to develop and focus the development of BEMPEG, and I would expect that that's where we wind up. Clearly, clearly at this point...

Yeah, if we get if we and I believe we will.

You have six major registrational trials running in six different indications.

With BMS I do believe that.

A good way to develop.

And for a focused development of net of Mpeg and I would expect that Thats, where we wind up.

Clearly clearly at this point.

Howard W. Robin: Running 20 trials is probably not the right thing to do in terms of how we use our resources, but I think if we identify, and I know we will, five or six very relevant, very significant registrational trials, I would expect that we can bring BEMPEG and NEVO to a very, very good result, and that's our plan to go forward.

Running 20 trials is probably not the right thing to do in terms of in terms of how we use our resources, but I think if we if we identify and I know, we will five or six very relevant very significant registrational trials I would expect that we can bring.

Ben Peg and Nivo to a very very good result, and that's our plan to go forward.

Okay got it and Howard just kind of following up on that.

Jessica Macomber Fye: Okay, got it. And Howard, just kind of following up on that, in your quote in the press release, I think you mentioned the potential for the doublet of BEMPEG and NEVO. I just wanted to confirm, is that to say that there's maybe less interest now in exploring that IO doublet in combination with chemo, TKIs, etc.?

And your quote in the press release I think you mentioned the potential for the doublet of Ben Paganini, though I just wanted to confirm is that to say that there's maybe less interest now in exploring that I O doublet in combination with keynotes, you can size et cetera.

I'm going to let Mary cover where we're going with that hold on thank you.

Mary Tagliaferri: I'm going to let Mary cover where we're going with that, hold on, thank you.

Yeah, I guess, it's Mary we are continuing to evaluate our options with the doublet and other agent chemotherapy in Teekay <unk> and so we will keep you posted on the additional development and result in those studies. Thanks.

Mary Tagliaferri: Yeah. Hi Jess. It's Mary.

Mary Tagliaferri: We are continuing to evaluate our options with the doublet and other agents, both chemotherapy and TKI, and so we'll keep you posted on the additional development and results in those studies. Thanks. Okay, great. And maybe just the last one, just to make sure I understand with the potentially registrational non small cell expansion cohort and those patients who progressed on PD one plus chemo. Do you anticipate updating that data or presenting that data along the way? Or should we only expect to hear the results from that study once it's matured? I think it's been estimated as being kind of like a second half 2020 event. Yeah, thanks for the question, Jeff. We are expecting in the second half of 2020. We also believe we should have data from the first line CIS and eligible study, the bladder cancer study, in the second half of 2020, as well as some early data from phase three and melanoma at that same time frame.

Okay, Great and maybe just a last one just want make sure I understand with the.

Potentially registrational non small cell expansion cohort in those patients who progressed on PD, one plus team now.

Do you anticipate updating that data are presenting that data along the way or should we only expect to hear the results from that study once it's mature I think it's been estimated as being kind of like a second half 2020 of them.

Yes. Thanks for the question, Yes, we are anticipating in the second half of 2020. We also believe we should have data from the first line setting eligible.

Bladder cancer study in the second half of 2020 as well as.

Some early data from the phase three in melanoma at that same time frame.

Mary Tagliaferri: And Jessica, I think as we move forward in the PROPEL study, studying non-small cell lung cancer in combination with PEMBRO, we'll be reporting on that as well.

And Jessica I think as we as we move forward and the propel studies studying non small cell lung cancer in combination with Pembro, we'll be reporting on that as well.

Great. Thank you.

Jessica Macomber Fye: Great, thank you. Thank you. Our next question comes from Tyler Van Buren on behalf of Piper Jeffries.

Thank you. Our next question comes from Tyler Van Buren from Piper Jaffray. Your line is open.

Tyler Van Buren: Hey guys, good afternoon. Thanks for taking the questions. The first one is a point of clarification about breakthrough therapy status in melanoma. Can you confirm if that was based on the 53 or 34 CRR that was presented at ASCO or if they were aware of what was going on here with the manufacturing and if it was, you know, based on that 75, the higher 75 response rate?

Hey, guys. Good afternoon, thanks for taking the questions.

The first one is a point of clarification for the breakthrough therapy status in melanoma.

Can you confirm if that was based on the 53 or 34, a CR that was presented at ASCO or if they were aware of what was going on here at the manufacturing and if it was based on that 75.

Your 75 response rate.

Steve Doberstein: Yeah, Tyler, this is Steve. The breakthrough status is based on the entire data set that was presented as it was presented at ASCO 2019. So, while the agency is aware of the difference in the response rates between the batches that we talked about, the breakthrough status is based on the entire data set.

Yes, Tyler this is Steve the.

Breakthrough status is based on the entire data set that was presented as it was presented.

At ASCO 2019.

So while the agency is aware of the difference in the response rates between the.

Batches that we talked about.

That the breakthrough status is based on the entire dataset altogether.

Steve Doberstein: Okay, that's helpful.

Okay. That's helpful and then and just and just to add to that that was asked that that breakthrough designation came after the entire control strategy and data was presented to the FDA regarding these cohort differences.

Steve Doberstein: And just to add to that, that breakthrough designation came after the entire control strategy and data were presented to the FDA regarding these cohort differences. Okay, that's helpful.

Okay. That's helpful.

Steve Doberstein: helpful. And when you were talking about first line long and the breakdown of PD-L1 greater than 50, below 50, and negative, and the differences there, you said, I think in less than 50, PD-L1 expression status, and negative, that the data supports the mechanism of action of BEMPEG plus NEBO. So can you just expand upon what you observed there in those cohorts that supports the MOA?

And.

When you were talking about first line lung and the breakdown of PDL, one greater than 50 below 50 in a negative and the differences there you said.

I think at less than 50, PDL, one expression says a negative.

That the data supports the mechanism of action of Mpeg plus Nivo. So can you just expand upon what you observed there in those cohorts that supports the ammo.

Yeah, what I mean by that Tyler is that when we look at.

Steve Doberstein: Yeah, what I mean by that, Tyler, is that when we look at, well, the data is immature, as we indicated during the talk, but when we look at first scan reductions in tumor size in those patients, in those cohorts, we see, I think, what I would characterize as promising results that do support that there is added efficacy between BEMPEG plus NEVO over what we would expect from checkpoint alone.

Well you know the data are immature as we indicated.

During the talk but when we look at first scan reductions in tumor size.

In those in those patients in those cohorts.

We see I think what I would characterize as promising results that do support that there is added efficacy between band Peg plus nivo.

Overall, we would expect from checkpoint alone.

Got it got it Okay and then just a follow up on the pivotal trials. The four that are ongoing.

Steve Doberstein: got it got it okay and then just to follow up on the pivotal trials the four that are ongoing can you confirm the order in the second half of next year is based upon current enrollment of bladder melanoma and lung if I recall that might have been the order last time we spoke and then also in melanoma I think you guys said it was an early data look is that still not going to be the median progression free survival and point for potential approval and as a follow-up do you still have that interim overall response rate look that's six months prior to that as well

Can you confirm the order in the second half of next year is based upon current enrollment of ladder melanoma and long if I recall that might have been the order last time, we spoke and then also in melanoma.

I think you guys said it was an early data look is that still not going to be the median progression free survival endpoint for potential approval and as a follow up do you still have that interim overall response rate looked at six months prior to that as well.

Yes, so look it's a little bit too early I think to handicap the specific order a finish of those trials, they're all still enrolling obviously.

Steve Doberstein: Yeah, so look, it's a little bit too early, I think, to handicap the specific order of finish for those trials. They're all still enrolling, obviously. The big one is melanoma, and that, I think, is the one that is being operationalized by BMS. I'll let Mary speak to the specifics of how that data is going to roll out with respect to ORR analysis and things like that.

The big one is melanoma and that I think is the one that.

He is.

Being operationalized by by BMS I'll, let Mary speak to the specifics of how that data are going to roll out with respect to.

Our analysis and things like that.

Yes, Hi, Tyler this is nir, yes, we expect the first data to readout for the phase three melanoma trial in the second half of 2020.

Steve Doberstein: Yeah, hi Tyler. This is Mary.

Mary Tagliaferri: Yeah, we expect the first data to read out for the phase three melanoma trial in the second half of 2020.

Okay. Thanks for taking the questions.

Tyler Van Buren: Okay, thanks for taking the questions.

Paul Choi: Thank you. Our next question comes from Paul Choi from Goldman Sachs. Your line is open.

Thank you.

Our next question comes from Paul Chile from Goldman Sachs. Your line is open.

Hi, Thank you everyone. Good afternoon, and thanks for taking our questions.

Howard W. Robin: Hi. Thank you, everyone. Good afternoon, and thanks for taking our questions. If we could maybe just focus on your comments with regard to the lung study, you highlighted that you are seeing differences or some benefit in the PD-L1 negatives and the PD-L1 low patients versus the PD-L1 high expressors. Is there any plan maybe to accelerate the enrollment in those patient subgroups, and could that represent potentially your fastest avenue of development in lung here or in terms of advancing data set out to the public domain, and when could that possibly happen if the enrollment there is happening a little faster?

If we could maybe just.

Got focus on the your comments with regard to the to the lung study.

And you highlighted that you are seeing differences and they are some some benefit in the PDL one.

Negatives on the PDL, one low patients versus the PDL one high expressers.

Is there any plan maybe to accelerate the enrollment in those and those are.

Those patient subgroups and could that represent potentially youre your fastest avenue of development and long hair or in terms of advancing dataset out out to the public domain and when could that possibly happen. If if enrollment. There is is is happening a little faster.

Well look the biggest need in that indication of course is in those patients who are PDL one negative at baseline and in those patients that are PDL, one 1% to 49%. So that's exactly the area in which we think we give most benefit and as we are doing throughout the rest of the program, that's where we're focusing our most accelerated.

Howard W. Robin: Well, look, the biggest need in that indication, of course, is in those patients who are PD-L1 negative at baseline and in those patients that are PD-L1 1 to 49%. So that's exactly the area in which we think we can give the most benefit. And as we are doing throughout the rest of the program, that's where we're focusing our most accelerated efforts. You know, I think we'll continue to divide those into those subgroups as we study lung both with NEVO and with PEMBRO in the context of the PROPEL study.

Efforts.

I think we'll continue to divide those.

In those sub groups.

As we study lawn, both with Nivo and with.

Pembro in the context of the propel study.

Okay and then just on the propel study can you maybe just confirm for US I think you said.

Steve Doberstein: Okay, and then just on the Propel study, can you maybe just confirm for us that I think you said Lot 5 was not used, but in terms of moving forward here, have any other patients been exposed to some of the questionable lots? And I guess, can you just confirm for us, I guess, with the planned patient enrollments, if there are any currently enrolled patients who were exposed to some of the earlier lots?

Lot five was not use spot in terms of that the go forward here.

Have any other patients been exposed to some of the.

Questor ball lots and I guess can you just confirm for US I guess with the planned patient enrollments. If there are any on any currently enrolled patients were.

Exposed to some of the some of the earlier lots.

So let me take the first part of that question first.

Steve Doberstein: So let me take the first part of that question first. What we meant to communicate is that in Propel, all of the initial patients received only Lot 5. So, that confounds the early set of patients that were in that trial quite a bit. Now, there are still patients in all of our studies who received some level of LATU intervention.

What we meant to communicate is that in propel.

All of the initial patients has received only lot five.

So that confounds. The early set of patients that were in that trial quite a bit now there are still patients on all of our studies, who received some level of lot two and five.

Okay. Thank you for that.

Paul Choi: Okay, thank you for that.

Thank you. Our next question comes from the say Yang from Mizuho. Your line is open.

Desai Yang: Thank you. Our next question comes from Desai Yang from Mizuho. Your line is open.

Alex: Hey, good afternoon, guys. This is Alex on for DFAY.

Hey, Good afternoon, guys. This is Alex on for Difei.

Howard W. Robin: Just a clarification question for me. In your four ongoing registrational trials, can you just confirm that, as you mentioned earlier, no patients were treated with defective batches? Is that correct?

Just a clarification question for me.

And in your four ongoing Registrational trials.

Can you just confirm that you mentioned earlier no no patients were treated with the defective batches is that correct.

Howard W. Robin: Yeah, that is correct. As Steve said earlier, Lot 2 was fully utilized, and Lot 5 was partially utilized, and so none of the patients in any of the registrational trials have ever received Lot 2 or 5. And in terms of the PROPEL study, just to further clarify what Steve was mentioning before, as the PROPEL study moves forward, it will obviously not have Lot 2 or 5 involved.

Yeah that is correct, we well as as as Steve said earlier, a lot too was few fully utilized and lot five was partially utilized and so none of the patients in any of the Registrational trials have ever received one two or five and in terms of the propel study just to further clarify on what Steve was mentioning before as the propel studies moves forward. It will obviously not have lot to revive involved with it.

Alex: Okay, thank you.

Okay. Thank you.

Thank you.

Bert Hazlitt: Thank you. Our next question comes from Bert Hazlitt from BTIG. Your line is open.

Our next question comes from Bert Hazlett from BTG. Your line is open.

Howard W. Robin: Thank you. I'd like to kind of take a step back and ask you, maybe more generally, about the relationship with BMS. It may be I'm hearing this incorrectly, but I'd love for you to verify it. Is the agreement under consideration for renegotiation, or are there clawbacks, or are there potential material reconsiderations? Clearly, the prioritization appears to be different, but to some degree, but I'd love for you to characterize the specifics with BMS at this point, if you can.

Thank you.

I'd like to kind of take a step back and ask.

Maybe more generally about the relationship with BMS.

And.

It maybe I'm hearing this incorrectly, but I'd love for you to verify it.

It is the agreement under consideration for.

Renegotiation or their clawbacks or there are potential material reconsideration clearly the prioritization appears to be different but somewhat but I'd love for you to characterize the the specifics Oh with CMS at this point if you can.

Howard W. Robin: Sure. Well, first of all, there are no clawbacks. There's no renegotiation. The fact is that, at this point, we will be moving forward with five or six major registrational trials, although we're not moving forward with 18. I think everybody understands that by now.

Sure well first of all there are no clawbacks theres no renegotiation.

The fact is that at this point, we will be moving forward with five or six major registrational trials, albeit were not moving forward with a team I I think everybody understands that by now but there are no claw backs. There is no effect there on on terms or conditions and to the extent that BMS chooses not to move forward in a particular indication then we're free to work with other companies in that indication and that that will be we will be work, we will be dealing with that and ascertaining that very very shortly and I said like I said earlier, whether whether I can't promise that thats going to be September it's going to be October but in the very very near future. We will have an absolute plan that we bring forward with BMS. So that everybody understands exactly where we're working on we've already defined four of those programs will most likely be two more and we will we will communicate that with everybody, but there are no claw backs, there's no provision for changing anything that contract is working as it should.

Howard W. Robin: But there are no clawbacks, so there's no effect on terms or conditions. And to the extent that BMS chooses not to move forward in a particular indication, then we are free to work with other companies in that indication. And we will be dealing with that and determining that very, very shortly. And as I said earlier, I can't promise that it's going to be September or it's going to be October, but in the very, very near future, we will have an absolute plan that we bring forward with BMS so that everybody understands exactly what we're working on. We've already defined four of those programs. They'll most likely be two more, and we will communicate that with everybody. But there are no clawbacks. There's no provision for changing anything. The contract is working as it should, and to the extent that BMS does not want to move forward in any specific areas, those are ours to do what we want with.

And to the extent that BMS does not want to move forward in any specific areas. Then those are ours to do what we want with.

Howard W. Robin: Okay, thank you very much for that. And then, with regard to Propel, again, just maybe a little bit more clarity: is there... Is there kind of a restart being contemplated in a certain way? How do you think about that data with Lot 5 in Propel, and what can you do with that data, and really how are you moving forward with that study?

Okay. Thank you very much for that and then with regard to propel.

And just maybe a little bit more clarity is is there.

Is there kind of a restart being contemplated in in a certain way.

How do you.

And how are you thinking about that data with lot fives in propel and.

And what can you do.

With that data and really how are you moving forward with that study.

Howard W. Robin: Yeah, I wouldn't call it a restart of ProPEL. I think we, unfortunately, Lot 5 was used in all the ProPEL patients, and we are now using other lots which are comparable to Lots 1 and 3, and we will be moving forward with ProPEL, particularly in first-line non-small cell lung cancer in combination with PEMBRO. And as data emerges from that study, we will share it with everybody. So we're refocusing it, but I wouldn't say we're restarting it.

Yeah, I wouldn't I wouldn't call. It a restart of propel I think we unfortunately lot five was used in all the propel patients and we are now using other lots, which are comparable to lots one in three and we will be moving forward and propel particularly in first line non small cell lung cancer in combination with Pembro and as data as data emerges from that study.

We we will share with everybody.

So we're refocusing it but I wouldn't say we're restarting it.

Okay and I I.

Jonathan Zalevsky: Okay, and just an ancillary question. I know the molecules are related, but 214 and 35A. Is there any reason to think that potential similar circumstances might have gone on with the manufacture of 358 or have you looked into that at all?

Just an ancillary question.

Yes, I know the molecules are related but two on for 358.

Is there any reason to think that.

Potential similar.

Circumstances have gone on with the manufacturer 358 or.

Have you looked into that at all.

Jonathan Zalevsky: Hey Bert, this is Jay Z. No, this manufacturing issue was solely and exclusively related to BEMPEG. It does not impact any of the other molecules that we manufacture, either ourselves or any of our partner collaborations. Okay, thank you.

Hey, Bert this is Jay Z no. This this manufacturing issue was solely and exclusively related to bend pag. It does not impact any of the other molecules that we manufacture either ourselves or any of our partner collaborations.

Okay. Thank you.

Thank you. Our next question comes from Andy Schenker from William Blair.

Andy Shea: Thank you. Our next question comes from Andy Shea from William Blair. Your line is open.

Howard W. Robin: Great, thanks for taking my question. I'm trying to piece together the exact mechanism.

Your line is open.

Great. Thanks for taking my question I'm trying to piece together the exact mechanism it seems like.

Jonathan Zalevsky: It seems like patients who will receive treatment from BLOTS 2 and 5, you know, the response rate and durability, you know, at least they look like they just received Opdivo alone. So, in terms of Jay-Z, I think you mentioned the differences in receptor occupancy, is it a problem with the primary sequence? Is it a primary-is it a problem with the pegylation? And in terms of that, did you guys get a chance to look at biomarker data to kind of correlate the BLOTS 2 and 5 issues and really see a difference not only in the occupancy but also, you know, biomarkers typically, you know, priming of the T cells and everything you guys have been looking at?

Patients who receive treatment from.

That's two and five.

The response rate and durability.

At least they look like they just received opdivo alone.

So in terms of JV I think you mentioned about the differences receptor occupancy is it or is it a problem with the primary sequences of primary is a problem with the population.

And in terms of that did you guys get a chance to look at biomarker data to kind of correlates.

You know the last two and five issues and really see a difference not only in the occupancy but also biomarkers specifically.

Priming of the T cells, and and everything you guys have been in looking at.

Jonathan Zalevsky: Yeah, hey, Andy, this is Jay Z. So yeah, we did look at a number of these. And let me kind of summarize some of those. So let's start off with pharmacodynamics. So we did look at the pharmacodynamics between the different lots and between the different patients, of course, in PIVOT, and I will say that we did not observe specific pharmacodynamic differences between the lots. But we do have to remember that there are some limitations, and the main one being that we only collect an on-treatment biopsy at week three, so basically at the end of that first cycle. So we don't know if other time points would have shown us other kinds of differences. And while we didn't see some of those pharmacodynamic differences, as I mentioned, our mathematical modeling did indicate that based on some of these physical differences, we'd expect a really different profile of receptor occupancy, particularly the bias around the dimeric beta gamma receptors.

Yeah, Hey, Andy This is Jay Z. So yeah, we did look at a number of these and let me kind of summarize some of those so let's start off with the Pharmacodynamic. So we did look at the pharmacodynamics.

I mean, the different lots and between the different patients of course, if it and it will say that we did not observe specific pharmacodynamic differences between the lots that we do have to remember there are some limitations and the main one being that we only collecting on treatment biopsy at week three so basically at the end of that first cycle. So we don't know if other time points would have shown as other kinds of differences.

And while we didn't see some of those pharmacodynamic differences as I mentioned, our mathematical modeling did indicate that based on some of these physical differences, we'd expect a really different profile of receptor occupancy, particularly the bias around the dime marrying the beta gamma receptors.

Jonathan Zalevsky: And I can't really get into some of the structural things that we found to be proprietary, and as I mentioned, they've even led to some new intellectual property. But what we do know is that that relationship with the clinical data that Steve presented is something that's very notable, and we have very, very high confidence that what happened in GMP 2 and 5, those two lots, really isn't happening anymore. We've moved well beyond that with our control strategy that we're implementing into commercial manufacturing.

And you can't really get into some of the structural things that we've done is proprietary and as I mentioned, they've even led to some new intellectual property.

Well, we do know is that that relationship with the clinical data that Steve presented is something that that is very notable and we have very very high confidence that what happened in GMP two and five those two lots really is not happening anymore, we've moved well beyond that with our control strategy that we're implementing into the commercial and manufacturing.

Great Okay.

Andy Shea: Great. Okay.

Andy Shea: And is it consistent? I didn't have time to kind of look over all the different histologies, but is it consistent? And is it true that it seems like, you know, BNPAG in those cohorts did not actually contribute to any meaningful efficacy? Is that kind of a true statement based on your observations?

It is it is it consistent I didn't have time to kind of look over all the different histologies, but is it is it consistent and is it true that it seems like you know.

Ben Pag in dose cohorts did not.

Actually contribute to any meaningful efficacy that is that kind of a true statement based on your observations.

Yeah. So so based on our analysis of the data you have patients that started on lots two and five they looked more like nivo monotherapy, but look that's exactly right. That's the date is indicating.

Jonathan Zalevsky: Yeah, so based on our analysis of the data, you have patients that started on lots two and five; they looked more like NEBO monotherapy. That's exactly right.

Okay and.

Andy Shea: Okay, and so, do you mind reminding me what you kind of mentioned about a Fleming analysis in non-small cell lung cancer? I didn't really quite understand that. Do you mind kind of reminding me what's going on there?

So do you mind reminding me kind of mentioned about.

Flemming analysis into non small cell lung cancer.

Right.

I didn't really quite get that do you might kind of reminding me, what's what's going on there.

Yes, so obviously to to look at the Flemming, we have to have fully enrolled cohorts and we haven't yet fully enrolled to the maximum number of patients to analyze the fleming. So once we do that we will.

Andy Shea: Yes, so obviously, to look at the Fleming trial, we have to have fully enrolled cohorts, and we haven't yet fully enrolled the maximum number of patients to analyze the Fleming trial. So once we do that, you know, we will find a conference to present those data. And that was specifically the reason why, you know, when we spoke to the investigator who submitted the abstract to ESMO, she did not want to present the data as we don't have a complete data set, and the data are too immature at this time to analyze Fleming.

Find a conference to present those data and that was specifically the reason why you know when we spoke to the investigator [laughter] submitted the abstract as no. She did not want to present the data as we don't have a complete dataset and the data are too immature at this time.

David Steinberg: Oh, got it. Okay. Now I understand it.

To analyze the plenty.

Oh got it okay now I get it. Thank you. Thank you very much and and.

Howard W. Robin: Thank you. Thank you very much. Yeah. Okay. Got it. Cool. Thank you very much for answering all my questions.

Yes, Okay got it cool. Thank you very much for answering my questions.

Howard W. Robin: Thank you. Our next question comes from David Steinberg of Jeffries. Your line is open.

Thank you.

Our next question comes from David Steinberg from Jefferies. Your line is open.

David Steinberg: Thanks very much. I know the clear focus of the call today is on Ben Pegg and oncology, but given the unusual general advice letter you got from the FDA a couple of weeks ago, the delay for the adcom, and your comments at the start of the call, I just had two questions on 181. The first regards your NDA filing. So I know the letter you got from the FDA was only four weeks away from the PDUFA date. So could you comment, by that time, usually there's labeling discussions going on. Could you comment as to whether you're actually engaged in some level of label discussions? And secondly, were all the manufacturing sites cleared?

Thanks, very much I know the clear focus of the call today is on Ben Peg in oncology, but but given the unusual general advice letter you got from the FDA couple of weeks ago, the delay for the AD com and your comments at the top of the call I just had two questions on 181.

The first with regard your Anda filing so I know that the letter you got from the half there was only four weeks away.

From the PDUFA date, so could you comment by that time, usually there's labeling discussions going on could you comment as to whether you actually engage in some level of label discussions and secondly.

Well the manufacturing sites cleared.

Howard W. Robin: And then the second question relates to the JV. I think you said you're seeking equity partners. Do we assume that... the equity partners will sign up, assuming FDA approval, or if you get FDA approval and you don't get all the equity partners you want, will the company underwrite at least part of the JV on its own? Thanks.

And then the second question relates to the JV I think you said you're seeking equity partners.

Do we assume that.

The equity partners will sign up assuming FDA approval or.

If you get an FDA approval and you don't get all the equity partners you want will the company under right at least part of the JV on its own. Thanks.

Howard W. Robin: Okay, thanks. Well, look, your first question was very insightful, and the answer is yes. We are having labeling discussions with the agency regarding Nektar 181, and they continue to review the NDA, and we're still hopeful that we, you know, we have, you know, we have a good relationship with them, an adcom, and a result by the end of the year. There are no manufacturing issues, no CMC issues.

Okay. Thanks, well look you first your first question was very insightful and the answer is yes, we are having labeling discussions with the agency regarding Nektar 181, and they continue to through the end da and we're still hopeful that we you know we have.

An AD com and result by the end of the year. There are no manufacturing issues no CMC issues. We've been fully reviewed there has been nothing that's come up there so I don't see that.

Howard W. Robin: There's been nothing that's come up yet, so I don't see that as an issue. In terms of financing, look. I think you can imagine that you're not going to have capital partners put in significant capital prior to, at a minimum, an adcom or approval. But I think everybody recognizes how important this drug is in going towards solving the opioid crisis. It is a major component of solving the opioid crisis in our country, and I think everybody recognizes it.

As an issue in terms of.

In terms of financing.

Look.

I think you can imagine that you're not going to have capital partners.

Putting significant capital prior to.

At a minimum an AD com or approval, but I think everybody recognizes how important this drug use in going towards solving the opioid crisis. It is a major component of solving the opioid crisis for our country and I think everybody recognizes it I think the FDA hopefully recognize it.

Howard W. Robin: I think the FDA hopefully will recognize it, and I think at some point, capital will be accessible. But I clearly think that we're going to have to at least have an adcom first before anybody commits. But I'm not terribly concerned about that. I think we'll make that happen. We've set up an important subsidiary in Harris with a great management team who are absolutely focused on bringing this drug to market in a very, very important way. Like I said, it's very encouraging that we are continuing labeling discussions with the, Great, thanks.

And.

I think at some point capital will be accessible, but I clearly think that we're going to have to at least have an ad com.

Our first before before anybody commit I'm not I'm not terribly concerned about that I think will make that happen we've set up a.

An important subsidiary and Harris with a with a great management team who is absolutely focused on.

Making this bringing this drug to market in a in a very very important way and.

Like I said like I said, it's very encouraging that we are continuing labeling discussions with the agency.

Great. Thanks.

Howard W. Robin: Thank you. Our next question comes from George Farmer from BMO Capital Markets. Your line is open.

Thank you.

Our next question comes from George Farmer from BMO capital markets. Your line is open.

George Farmer: Hi, Thank you.

Hi, Thanks for taking my questions.

Howard W. Robin: Thanks for taking my questions.

Howard W. Robin: So, given that the enrollment...

So given that the enrollment in non small cell lung cancer is going slowly and seems like a lot of the patients in your trial.

Howard W. Robin: Enrollment in non-small cell lung cancer is going slowly, and it seems like a lot of the patients in your trial, as well as in the urothelial cancer trial, got these batches two and five. What gives you confidence that your registrational trials will be positive in those two indications?

As well as in the Urothelial cancer trial cut these batches two in five.

What gives you confidence that your registrational trials will be positive.

In those two indications.

Well look in non small cell lung cancer, we haven't yet talked about our registrational trial.

Howard W. Robin: Well, look, in non-small cell lung cancer, we haven't yet talked about our registrational trial pathway there. So, you know, stay tuned. I think as that data emerges and as it continues to evolve, we'll be able to say more about that. But when we look across the totality of the bladder cancer data set, and in particular, the number of deep responses that we see and the duration of those responses, you know, I think we feel pretty good about our bladder cancer performance against the standard of care in the landscape right now. All right.

Pathway there so.

Stay tuned I think as that data emerges and is.

As it continues to evolve we will be able to say more about that I think when we look across the totality of the bladder cancer.

Dataset and in particular.

The.

Number of deep responses that we see in the duration of those responses I think we feel pretty good about our.

Our bladder cancer performance against the standard of care.

In the landscape right now.

Alright, but sorry, the second line trial.

Howard W. Robin: Online

Mary Tagliaferri: The DEN trial in lung cancer, one of the four trials in that, is going to be used for registration.

In lung cancer, one of the four trials isn't that going to be used for registration.

Mary Tagliaferri: Yeah, hi. This is Mary.

Yes, Hi, this is Mary and Yeah, just two things one when we look at bladder cancer, even when you look at the pool data, we still have a complete response rate that is twice as good as what you see with Pembro or capitalism AD and then even when you look at you know our lots one in three you really see the half the patients responded and 42% of them actually had complete responses. So we do have a tremendous confidence in our mechanism of action and in that bladder cancer study and.

Mary Tagliaferri: You know, just two things. One, when we look at bladder cancer, even when you look at the pooled data, we still have a complete response rate that is twice as good as what you'd see with PEMBRO or tezolizumab. And then even when you look at, you know, our lots one and three, you really see half the patients responded, and 42 percent of them actually had complete responses. So we do have tremendous confidence in our mechanism of action and in the bladder cancer study. And we look forward to the outcome of that.

We look forward to the outcome of that now with respect to the second line non small cell lung cancer. ASKO 2018, we did have Dr. Scott Gettinger go through three different cases, two of which you were responders and the third one which was having a very meaningful clinical response and these were in patients who had previously.

Jonathan Zalevsky: Now, with respect to second-line non-small cell lung cancer at ASCO 2018, we did have Dr. Scott Gettinger go through three different cases, two of which were responders, and the third one, which had a very meaningful clinical response. And these were in patients who had previously been treated with IO agents. And what was unique about that patient population is that they also had responses to their initial IO treatment. And so we modified that second line IO refractory patient population so that these patients could not have had primary refractory disease. They could only have relapsed disease, meaning that they had 120 days of stable disease or better in order to come on to the trial.

Been treated with Io agents and what was unique about that patient population is they also had responses to their initial io treatment and so we modified that second line Io refractory patient population. So that these patients could not have had primary refractory disease. They could only have a relapse disease, meaning that they had 120 days of stable disease or better in order to come onto the trial.

And I can let Jay Z Mechanistically explain why we feel that there is a rationale for that.

Mary Tagliaferri: Yeah. Thanks, Mary. Yeah.

Yes. Thanks, Thanks, Mary Yes, the one thing that I'll add is so remember like just as it does a key biomarker component, especially when you consider the urothelial carcinoma.

Howard W. Robin: The one thing that I'll add is, just as a key biomarker component, especially when you consider urethelial carcinoma, remember that we showed a very high frequency of PD-L1 conversion in that population, which is why, of course, that is a PD-L1 negative, readout kind of study. We provided that mechanistically. And the key was that that was data that we showed with the entire cohort of patients. So even though we are noting the sort of differences between lots and we're applying that to a registration strategy, we still believe that there is enough confidence from the data that we have, you know, that progressing into the registrational program, we have a good opportunity to be successful.

Remember that we showed a very high frequency of PDL one conversion.

In that population, which is why of course that is a PDL one negative read out kind of a study we provided that mechanistically and the key was that that was data that we showed with the entire cohort of patients. So so even though we are noting the sort of differences between lots and we're applying that to a registration strategy. We still believe that there is enough confidence from the data that we have you know.

That progressing into the Registrational program, we have a good opportunity to be successful, yes, and George and just.

George Farmer: Yeah, and George, in just closing this conversation, the two responders that we did see started on lots 1 and 3, again, providing the confidence that we'll see efficacy in this patient population.

In closing this conversation the two responders that we did see started on lot one in three again, providing the confidence that we will see efficacy in this patient population.

Mary Tagliaferri: Okay, and then at CITSE, when you present the melanoma data, are we going to see the whole intent-to-treat population, or are you going to break out the patients based on the amount of the drug that was received?

Okay, and then it fits the when you present the melanoma data are we going to see the whole intent to treat population are you going to breakout to patients based on.

Lot of drug that was received.

Yes, so yeah, we havent you prepared the presentation, yet, but obviously, we've always shown pool data and we have the opportunity to an agreement with BMS to show.

Mary Tagliaferri: Yeah, so, you know, we haven't prepared the presentation yet, but obviously, we've always shown pooled data, and we have the opportunity, in agreement with BMS, to show the data by first lot that's been received, so we do have that possibility, and we shared with you today the response rate at first scan, as well as the best overall response so far in that population. Again, I just want to emphasize that our breakthrough therapy designation was based on the pooled data between lots one and three and lots two and five, and the FDA was fully aware of these differences that we've seen between lots when they reviewed the BTD document.

The data by first slot that's.

Then the receipts that we do have that possibility and we shared with you today.

The response rate at first scan as well as the best overall response, so far in that population again I just want to emphasize that our breakthrough therapy designation was based on the pooled data between lots one and three in last two in five and the FDA, which were fully aware of these differences that we've seen between mott's when they review the BTD document.

George Farmer: Okay, and one more quick question. In the reveal trial with Nektar 262, your TLR agonist, which batch was used in that study?

Okay, Great and one more quick question in the reveal trial with Nexstar to six to your TLR.

Agonist, which batch was used in that study.

Jonathan Zalevsky: Hey George, this is Jay Z. We used batch four in that study, which is not a batch that was used in PIVOT, but from a characterization point of view, batch four resembles lots one and three, or batches one and three. Okay, great, thanks very much.

Hey, George this JV that we use batch for.

In that study, which is okay not not a badge that was used in pivot, but from a characterization point of view batch for resembles lots one in three or batch is one of the three from pivot.

Okay, great. Thanks very much.

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

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

And our next question comes from Dana Grey bars from SVB Leerink. Your line is open.

Daina Michelle Graybosch: Hi, thank you for the questions. The first one is on TMBC and the CRI. Could we conclude from your comments on the potential registration trials as well as breaking down the lots that you did not see a promise? Yeah, hi. Since we're presenting those data at the Quadruple meeting in September, we didn't go through all of the data presentation, but we look forward to sharing those data with you in Paris at the CRI Quadruple meeting in September. Great. And then a question on follow-up for Jay-Z.

Hi, Thank you for the questions. The first one on CNBC in the Sierra.

Could we interpret from your comments on the potential registration trials as well as breaking down the lots that you did not see a promising efficacy signal in this indication.

Yeah, Hi, since we're presenting those data a at the quadruple meeting in September we didn't go through all of the data presentation, but we look forward to sharing those data with you in Paris at the CR I quadruple meeting in September .

Great.

And then a question on follow up for JV, you talked about the mathematical modeling.

Mary Tagliaferri: You talked about the mathematical modeling to compare the lots. Have you had the opportunity to do any preclinical experiments, lab experiments, to validate that? And then all your previous preclinical work, do we know what lots those were done on?

To compare the lots have you had the opportunity to do any preclinical experiments lab experiments to validate that and then all your previous preclinical work do we know what lots those were done with.

Jonathan Zalevsky: Yeah. Hey, Daina. This is Jay Z.

Yeah, Hey, Dana.

This is Jay Z. So so as as we mentioned we did discuss the control strategy with the FDIC.

Jonathan Zalevsky: So, as we mentioned, we discussed the control strategy with the FDA, and so there was a lot of data that was necessary in order for that discussion because we had to present to the FDA all the things that were findings. I can't get into the details of that, though, because, as I mentioned earlier, that's proprietary to our molecule and to our company, and it's even led to some new intellectual property that we filed. So, I can't get into some of those details. But to your other question, then, in terms of the batches used for the earlier preclinical studies, including our own publications, yeah, so as we've described, what we observed in lots two and five was historical, really an outlier compared to all of the other batches we identified where we didn't see those kind of differences. So, the material that we used, even in our early research and early discovery campaigns, was material that was more representative of lots one and three.

And so there was a lot of data that was necessary in order for that.

Discussion because we had to present to the FDA all the things that our findings I can't get into the details of that though because as I mentioned earlier, that's proprietary to our molecule and to our company and it's even led to some new intellectual property that we follow so I can't get into some of those details but to your other question then in terms of the batches use for the earlier preclinical studies, including our own publications. Yeah. So as we've described what we observed in lots two and five was historical really an outlier compared to all of the other batches, we identified where we didn't see those kind of differences. So the material that we use even in our early research early discovery campaigns. It was material that was more representative of lost one in three.

Daina Michelle Graybosch: Got it. And then one last question. Which lots did you use in the single-agent dose escalation data? Was that anything from these problematic lots?

Got it and then one last question what's lots did you use in the single agent dose escalation data was that anything from these problematic lot.

Jonathan Zalevsky: Yeah, this is Jay Z again. Yeah, it was lot one that was used as the single agent in the Excel monotherapy trial and also the dose escalation part of PIVOT-02, that also used LOT1.

Yeah. This is Jay got yeah. It was lot one that was used in the single agent.

The XL monotherapy trial and also the dose escalation part of pivotal to that also used lot one.

Actually one more question. This is a huge investment both you and BMS, having all these registration trials would you consider repeating any of the cohorts.

Howard W. Robin: Actually, one more question. This is a huge investment both you and BMS have made in all these registration trials. Would you consider repeating any of the cohorts to get a sample in any of these ongoing registration trials quicker that was clean and had good lots?

To get a sample and any of these ongoing registration trials quicker that was clean with good luck.

Howard W. Robin: Well, I don't, yeah, no, I don't, I don't think that's the plan. I think we believe that we've, you know, identified the root cause. We can never prove causality, but we believe we understand what's happened.

Well I don't yes, no I don't I don't think that's the plan I think we believe that we've.

Identified the root cause can never prove causality, but we believe we understand what's happened and we already have as I said three registrational trials running we know the the lots that are going into the clinic now for all the Registrational trials look like lot one in like walk three and as I said no one of the Registrational trials ever received lot two or five so there's there's no reason to slow things down and as you know the landscape is also dramatically changing in a rapid basis in a rapid way in the field of immuno oncology, so slow slowing things down to do additional homework. So to speak I don't think is is particularly attractive here and I don't think there's really any need for it we have some very very clear results.

Howard W. Robin: And we already have, as I said, three registrational trials running. We know the lots that are going into the clinic now for all the registrational trials look like lot one and like lot three. And as I said, no one in the registrational trials ever received lot two or five.

Howard W. Robin: So there's no reason to slow things down. And as you know, the landscape is also dramatically changing on a rapid basis, in a rapid way, in the field of immuno-oncology. So slowing things down to do additional homework, so to speak, I don't think it's particularly attractive here, and I don't think there's really any need for it. We have some very, very clear results in a number of these studies. Look at melanoma, for example; here you have breakthrough status in first-line melanoma, which is, which is a pretty significant accomplishment. So we're going to move ahead with these studies, studies in a reg, in a registrational trial setting, and get them pegged to market as quickly as we can.

In a number of these studies look at melanoma. For example here you have breakthrough status in first line melanoma, which is which is a pretty significant accomplishments. So we're going to we're going to move ahead with these strategic studies in a race in a registrational trial, setting and get them pegged to market as quickly as we can.

Howard W. Robin: Thank you. Thank you, and I am showing no further questions from our phone lines, and I'd like to turn the conference back over to Howard Robin for any closing remarks.

Okay. Thank you.

Thank you.

And I am showing no further questions from our phone lines I'd now like to turn the conference back over to Howard Robin for any closing remarks.

Well. Thanks, Thank you for joining us today, everyone. I know you will have some more questions. At a later date there was a lot of information provided but.

Howard W. Robin: Well, thank you for joining us today, everyone. I know you'll have some more questions at a later date. There was a lot of information provided, but we're happy to set up one-on-one meetings and discuss this with you in more depth if you need to understand it better. And I want to thank all of our employees, who I know are working very diligently on all the tasks that lie ahead of them. So, thank you for joining us this afternoon.

We're happy to set up a one on one meetings and discuss this with you in more depth, if you need to understand it better.

And I want to thank all of our employees, who I know are working very diligently.

On all the tasks that lay ahead of them. So thank you for joining us this afternoon.

Operator: Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program, and you may all disconnect. Everyone have a wonderful day.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program and you may all disconnect everyone have a wonderful day.

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