Q2 2019 Earnings Call

Operator: I would now like to introduce your host for today's conference call, Mr. Christopher Keenan, Vice President of Investor Relations. Chris, you may begin.

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

Later, we'll conduct a question answer session and instructions will follow at that time.

If anyone should require assistance during the conference. Please press Star then zero on your Touchtone telephone.

Christopher Keenan: Thank you, Valerie. Good afternoon, and thank you for joining us. Earlier today, we issued a press release that includes a summary of our recent progress and second quarter 2019 financial results. This press release and a recording of this call can be found under the Investors in News section of our website at CytomX.com. With me today are CytomX President, Chief Executive Officer, and Chairman, Dr. Sean McCarthy, and CytomX Vice President of Finance, Robin Nifsen. During today's call, we will be making forward-looking statements. Because forward-looking statements relate to the future, they are subject to inherent uncertainties and risks that are difficult to predict, and many of which are outside of our control. Important risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov, including our Form 10-Q filed today. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future developments, or otherwise. A webcast of this call will be available on the Investor Relations page of CytomX's website at CytomX.com. I would now like to turn the call over to Sean.

As reminder, this call maybe recorded.

I would now like to introduce your host for today's conference call Mr., Christopher Keenan, Vice President Investor Relations, Chris You may begin.

Thank you Valerie.

Good afternoon, and thank you for joining US earlier today, we issued a press release that includes a summary of our recent progress and second quarter 2019 financial results.

This press release and a recording of this call can be found under the investors and news section of our website at say Tomex Dot com.

With me today are say topics, President Chief Executive Officer, and Chairman Dr., Shawn Mccarthy and say Tomex, Vice President of Finance Robinet said.

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

Important risks and uncertainties are set forth in our most recent public filings with the FCC at SCC Dot Gov, including our Form 10-Q filed today.

We undertake no obligation to update any forward looking statements, whether as a result of new information future developments or otherwise a webcast of this call will be available on the Investor Relations page at say Tomex Web site, I'd say Tomex dotcom I would now like to turn the call over to Sean.

Sean A. McCarthy: Thanks, Chris, and good afternoon, everyone. I'm very pleased to be here with you today to briefly review CytomX Productive's second quarter. At CytomX, we see a major opportunity to more effectively target therapeutic antibodies into diseased tissue, generating new classes of differentiated anti-cancer therapies as either best-in-class molecules against validated targets or first-in-class molecules against novel targets that we believe only our technology can address. Our innovative approach to antibody localization into diseased tissue is called the ProBody Platform. ProBodies are fully recombinant antibody prodrugs comprised of a therapeutic antibody, a linker, and a mask designed in a way that the antibody can't see its target until the mask is removed. Mask removal is achieved specifically and selectively within cancer tissue by certain disease-associated proteins called proteases.

Thanks, Chris and good afternoon, everyone I'm very pleased to be here with you today to briefly review sites I'm, it's productive second quarter.

So it's a mix, we see a major opportunity to more effectively target therapeutic antibodies into diseased tissue generating new classes of differentiated anticancer therapies as he's the best in class molecules against validated targets well first in class molecules I guess novel targets that we believe only our technology can address.

Our innovative approach to antibody localization into diseased tissue is called the pro body platform.

For our bodies are fully recombinant anti body prodrugs comprised of a therapeutic antibody a linker and they must be designed in a way that the antibody can see its target until the mosque is removed.

Moscow removal is achieved specifically and selectively within cancer tissue by certain disease associated proteins called proteases.

Sean A. McCarthy: Proteases are molecular scissors that play a key role in cancer cell invasion and metastasis. We take advantage of high levels of protease activity in cancer tissue to clip the mask off pro-bodies in the tumor, allowing the underlying antibody to bind the target and elicit its biological effect. ProBody Therapeutics offer localized target binding in disease tissue while maintaining potency, reducing side effects, and enabling new targets and mechanisms to be translated into novel product opportunities. We see this as a really big idea, backed by decades of antibody and protease biology research, by our deep knowledge of the biology of the tumor microenvironment, by our innovative protein engineering, and by our robust intellectual property portfolio. We are the leader in this emerging field of therapeutic antibody localization with four clinical stage programs, strong partnerships, and we're the first to have shown clinical proof of concept for this novel approach. We aim to maintain our leadership in this field by aggressively developing our assets and our intellectual property.

Proteases, our molecular scissors, which play a key role in cancer cell invasion and metastasis.

We take advantage of high levels of protease activity in cancer tissue to clip the mask off probably bodies in the tumor, allowing the underlying antibody to bind target under lisas biological effect.

Probably therapeutics off a localized target binding in disease tissue, while maintaining potency, reducing side effects and enabling new targets of mechanisms to be translated into novel product opportunities.

We see this as a really big idea backed by decades of antibody and protease biology research by our deep knowledge of the biology of the tumor micro environment.

By our innovative products and engineering and our robust intellectual property portfolio.

We are the leader in this emerging field of therapeutic antibody localization with four clinical stage programs strong partnerships and were the first to have showed clinical proof of concept for this novel approach.

We had to maintain our leadership in this field by aggressive development of our assets and our intellectual property.

Sean A. McCarthy: In the second quarter, our teams continued to make progress in advancing our novel ProBody platform and our portfolio of innovative, wholly owned, and partnered programs. Building on the strong body of clinical data we have reported to date, including encouraging safety and efficacy profiles from our two lead wholly-owned programs, CX072 and CX2009, alongside our continued strong cash position, we're now setting the stage for further advancement of these unique and potentially differentiated On this call, I'd like to provide brief updates on our programs and lay out a roadmap for next steps and future disclosures.

In the second quarter, our teams continue to make progress in advancing our novel Probity platform and our portfolio of innovative wholly owned and partnered programs.

Building on the strong body of clinical data, we have reported to date, including encouraging safety and efficacy profiles from our two lead wholly owned programs Cxo seven two and CX users or nine.

Alongside our continued strong cash position, we're not setting the stage for further advancement of these unique and potentially differentiated assets.

On this call I'd like to provide brief updates on our programs and last a roadmap for next steps and future disclosures.

Sean A. McCarthy: Let me start with our most advanced program, the PD-L1 Targeting ProBody CX-072. Our vision for CX072 is for this probody to become a differentiated centerpiece of combination anticancer therapy by enabling safer, more effective combinations. We have presented Phase I clinical data on CX072 as monotherapy and in combination with the anti-CTLA-4 antibody ipilimumab to support this vision, and we are enthusiastic to move this program to the next stage of its development. In Q2, we reported updated data at ASCO 2019 from our ongoing monotherapy dose expansion cohorts studying CX072 in multiple tumor types at the dose of 10 mg per kg. Data were presented in poster form and also reviewed as part of a next-generation immunotherapy discussion session led by Dr. David Page of the Providence Cancer Center, consistent with our previously presented phase one dose escalation data.

Let me start with our most advanced program the PDL, one targeting properties Cxo 72.

Our vision for Cxos seven to cause for this probably body to become a differentiated centerpiece of combination assay cancer therapy by enabling safer more effective combinations.

We have presented phase one clinical data on six or seven to as monotherapy and in combination with the SEC for antibody Ipilimumab. The support this vision and we are enthusiastic to move this program to the next stage in its development.

During Q2, we reported updated data at ASCO 2019 from our ongoing monotherapy dose expansion cohorts studying cxo seven two in multiple tumor types the dose of 10 milligrams per kilogram.

Data were presented in poster form I'd also reviewed as part of a next generation immunotherapy discussions session led by Dr., David Page 12, the Providence Cancer Center.

Consistent with our previously presented phase one dose escalation data.

Sean A. McCarthy: These data continue to show a favorable safety profile for CX072 when compared to conventional anti-PD-1 and PD-L1 antibodies. The efficacy profile of CX072 has also continued to mature, with robust evidence of anti-cancer activity being seen in patients with triple negative breast cancer, anal squamous cell carcinoma, cutaneous squamous cell carcinoma, and undifferentiated pleomorphic sar We expect to complete these initial expansion cohorts and decide our next steps for Monotherapy CX072 in the second half of 2019.

These data continue to show a favorable safety profile for Cxos 17, when compared to conventional anti PD, one and PDL one antibodies.

The efficacy profile of Cxo seven to also continue to mature with robust evidence of anti cancer activity being seen in patients with triple negative breast cancer, and squamous cell carcinoma, cutaneous cutaneous squamous cell carcinoma, and differentiated play Morphic sarcoma.

We expect to complete these initial expansion cohorts and decide on next steps for monotherapy Cxo 70 in the second half of 2019.

Sean A. McCarthy: To date, our monotherapy data for CX072 supports the idea that it could become a safer foundation for combination therapy. The first such combination we set out to study in depth in the clinic is CX072 plus ipilimumab. We believe the combination of ipilimumab with other anti-PD agents continues to hold much promise, as recently demonstrated by the positive readout in the combination arm of BMS Checkmate 227 trial in lung cancer. However, it's well accepted that the full potential of this IO-IO combination is limited by the profound toxicity of these mechanisms when used together.

Today, So I'm gonna therapy data for Cxos seven to supports the idea that it could become a safer foundation for combination therapy.

The first such combination we set out to study in depth in the clinic is Cxo 70, plus ipilimumab.

We believe the combination of Ipilimumab with other anti PD agents continues to hold much promise as recently demonstrated by the positive readout in the combination arm of BMS checkmate two to seven trial in lung cancer.

However.

It's well accepted that the full potential of this Io Io combination is limited by the profound toxicity of these mechanisms when used together and it's important to note that BMS was limited to one make pick a VP every six weeks in the two to seven study compared to the full label dose of three makes big every three weeks.

Sean A. McCarthy: And it's important to note that BMS was limited to 1 mg per kg of IPI every 6 weeks in the 227 study compared to the full labeled dose of 3 mg per kg every 3 weeks. Our previously reported Phase 1 data have shown that CX072 is generally well-tolerated with full-dose ipilimumab. Moreover, we've reported deep and durable responses for this combination in advanced stage patients. This phase one work also established the maximum tolerated dose of the combination as 10 mg of Cx072 and 3 mg of ipilimumab. We are now in the process of initiating the next phase of development for this combination and will be providing additional details in the near future.

Our previously reported phase one data has shown the cxo seven two is generally well tolerated with full dose ipilimumab.

Moreover, we have reported deepened durable responses for this combination and advanced stage patients.

This phase one work also established the maximum tolerated dose of the combination as 10 makes the keurig of Cxo seven two and three makes the cake of Ipilimumab.

We are now in the process of initiating the next phase of development of this combination and we will be providing additional details in the near future.

Turning now to our second wholly owned program Cfptwos are as there are nine potentially first in class property drug conjugate targeting CD 166, a unique and broadly expressed tumor antigen.

Sean A. McCarthy: Turning now to our second wholly-owned program, CX2009, a potentially first-in-class pro-body drug conjugate targeting CD166, a unique and broadly-expressed tumor antigen. Because ProBody Therapeutics is designed to minimize binding of the drug to normal tissues, we believe we're in a unique position to address a new class of targets with attractive molecular features that were previously thought undruggable because of their high CD166 is an example of this kind of target.

Because property therapeutics are designed to minimize binding of drug to normal tissues. We believe we're in a unique position to address a new class of targets with attractive molecular features that were previously thought undruggable because of high expression on normal tissues.

CD 166, as an example of this kind of target.

Sean A. McCarthy: CD166 is highly and homogeneously expressed in multiple solid tumor types and might be considered an attractive target for a conventional antibody drug conjugate were it not for the fact that it's also present in most normal epithelial tissues. We think it's a promising target for a pro-body drug conjugate, however, since pro-bodies allow us to more selectively target tumor tissue. CX2009 is a CD166-targeting pro-body drug conjugate conjugated to the microtubule inhibitor DM4. During Q2, we presented updated data from the phase 1 dose escalation trial of CX2009 monotherapy at AACR. The focus of this trial was to get a first look at the safety and preliminary efficacy of this novel drug candidate in patients with select cancer types. Among patients who received greater than or equal to 4 mg per kg of CX2009, 38% achieved tumor shrinkage, and 74% achieved stable disease or better at the time of their first on-treatment scan. Demonstrated anti-cancer activity included seven unconfirmed partial responses in breast cancer, ovarian cancer, and head and neck cancer. CX2009 was generally well tolerated.

CD 166 is highly and homogeneous expressed in multiple solid tumor types that might be considered an attractive target for a conventional antibody drug conjugate were it not for the fact that it's also present almost normal epithelial tissues.

We think its a promising target for a property drug conjugate however, since properties allow us to more selectively target tumor tissue.

CX user as there are nine is a CD 166 targeting pro body drug conjugates conjugated to the microtubule inhibitor DM for.

During Q2, we presented updated data from the phase one dose escalation trial of CX user nine monotherapy at a CR.

The focus of this trial was to get a first look at the safety and preliminary efficacy of this novel drug candidate in patients with select cancer types.

Among patients who receive greater than.

Equal to four makes mccaig FCX users are 938% achieve tumor shrinkage and 74% achieved stable disease or better at the time of that first on treatments scan.

Demonstrated anti cancer activity included seven unconfirmed partial responses in breast cancer, ovarian cancer and head and neck cancer.

Six users are nine was generally well tolerated.

Sean A. McCarthy: Despite the widespread expression of CD166 in normal tissues, no evidence of obvious on-target toxicity was observed, demonstrating the potential of pro-body masking to address novel first-in-class targets. We see these data as an encouraging start to the development of CX2009, and we're currently working to refine the dose of this agent as we advance towards the initiation of Phase 2 studies, potentially by the end of 2019. I'll now turn to our BMS and AbbVie partner programs. The lead program for our broad alliance with BMS is BMS 986249.

Despite the widespread expression of CD 166 on normal tissues, no evidence of albeit on target toxicity was observed demonstrating the potential of probity masking to address novel first in class targets.

We see these data as an encouraging start to the development of CX user as there are nine and were currently working to refine the dose of this agent as we advance towards the initiation of phase two studies potentially by the end of 2019.

I will now turn to our BMS and Abbvie partnered programs.

The lead program for our broad alliance with BMS is BMS 986 to four nine this is an ATK a four property based on Ipilimumab.

Sean A. McCarthy: This is an anti-CTLA-4 pro-body based on ipilimumab. This program is in a Phase 1-2 clinical study being run by BMS, evaluating the agent as monotherapy and in combination with Optivo, nivolumab, in advanced solid tumors. Based on progress with this initial clinical study, BMS is preparing to initiate a randomized phase 2 clinical trial comparing BMS 986249 plus Opdivo to ipilimumab plus Opdivo in patients with solid tumors. Upon the start of this study, CytomX will be entitled to a $10 million milestone payment. Naturally, we're pleased with this progress, and we anticipate this study will be initiated in the second half of 2019. As a reminder, our alliance with BMS also extends to ongoing research on additional pro-bodies, and BMS retains the right to select several additional targets for future research. The lead program from our alliance with AbbVie is CX-2029, a first-in-class pro-body drug conjugate targeting CD71. CD71 is widely expressed in normal tissues and therefore is considered to be an undruggable target for conventional antibody drug conjugate technology.

This program is in a phase one two clinical study being run by BMS evaluating the agent as monotherapy and in combination with Opdivo Nivolumab in advanced solid tumors.

Based on progress with this initial clinical study BMS is preparing to initiate a randomized phase two clinical trial, comparing BMS 986 to four nine plus opdivo to Ipilimumab plus opdivo in patients with solid tumors.

Upon the start of the study sites and this will be entitled to a $10 million milestone payment.

Naturally we are pleased with this progress and we anticipate this study will be initiated in the second half of 2019.

As a reminder, our alliance with BMS also extends to ongoing research on additional pre bodies and BMS retains the right to select several additional targets for future research.

The lead program from our alliance with Abbvie is CX to zero to nine a first in class per body drug conjugates targeting cdseventy one.

Cdseventy one is widely expressed on normal tissues, and therefore is considered to be an undruggable target for conventional antibody drug conjugate technology.

During Q2. This program continues to enroll patients in the initial dose escalation phase of the study which is being run by Cytomx.

Six to zero to nine is of course, a PDC conjugated to the payload M&A E under license from Seattle genetics.

So its embodies has responsibility to advance this program through initial cohorts expansion in select tumor types, where upon if successful the program will transition to Abbvie for Registrational studies and ultimate commercialization.

Robin Nifsen: During Q2, this program continued to enroll patients in the initial dose escalation phase of the study, which is being run by CytomX. CX2029 is, of course, a PDC conjugated to the payload MMAE under license from Seattle Genetics. CytomX has responsibility to advance this program through initial cohort expansion in select tumor types, whereupon, if successful, the program will transition to AbbVie for registrational studies and ultimate commercialization. CytomX retains certain profit split and co-commercialization rights for this asset. In parallel with the co-development of CX2029, we have an ongoing discovery alliance with AbbVie focused on the discovery and development of additional pro-body drug conjugates. Under this agreement, AbbVie recently selected a second target for advancement into preclinical studies, triggering a $10 billion payment to CytomX. I'll now turn the call over to Robin for a brief review of financial highlights from Q2.

Cytomx retain certain profit split and co commercialization rights for this asset.

In parallel with the co development FCX to there are Tonight, we have an ongoing discovery alliance with Abbvie focused on the discovery and development of additional pro body drug conjugates.

Under this agreement Abbvie recently selected a second target for advancement into preclinical studies, triggering a 10 million dollar payment to cytomx.

I'll now turn the call over to Robyn for a brief review of financial highlights from Q2.

Thank you Sean.

I would like to review selected financial highlights for the second quarter. We ended the second quarter with cash cash equivalents and investments totaling $349.1 million compared to 436.1 million as of December 31st 2018, and 396.6 million.

By specific antibody technologies from an Axcelis subsidiary in the first quarter, a 13.7 million federal tax payment for the 2018 tax return filing in the second quarter and approximately 4.7 million related to the University of California, Santa Barbara license agreement also in the second quarter.

Robin Nifsen: Thank you, Sean. I would like to review selected financial highlights for the second quarter. We ended the second quarter with cash, cash equivalents, and investments totaling $349.1 million, compared to $436.1 million as of December 31, 2018, and $396.6 million as of March 31, 2019. A decrease in cash for the first six months of 2019 included certain infrequent payments, such as a $5 million payment for the acquisition of technical know-how related to drug conjugate linker toxin and CD3-based bispecific antibody technologies from an Estella subsidiary in the first quarter, a $13.7 million federal tax payment for the 2018 tax return filing in the second quarter, and approximately $4.7 million related to the University of California Santa Barbara License Agreement in the second quarter. Our strong balance sheet allows us to fund operations well into 2021, assuming no new collaborations or financing.

Our strong balance sheet allows us to fund operations well into 2021, assuming no new collaborations or financing.

Research and development expenses were $30.8 million for the quarter compared to $25.6 million in the corresponding period in 2018.

The increase was attributable to license fees and maintenance fees related to an amendment to the U.S CSP licensing agreement, which included the issuance of 150000 shares of company common stock valued at $1.6 million and up front payment a $1 million and an additional annual maintenance fee of approximately $800000.

The increase was also attributable to the U.S CSP sub license fees pertaining to the $10 million milestone payment earned upon the Abbvie selection of the second target.

In the second quarter of 2019 and increases in personnel related and clinical related expenses, partially offset by a decrease of $2.3 million in laboratory contracts and services as a result of timing of manufacturing activities.

General and administrative expenses increased by $400000 for the quarter compared to the corresponding period in 2018 and was largely attributed to personnel related expenses.

Revenues during the second quarter of 2019 were 9 million compared to $21.3 million in the corresponding period in 2018.

Sean A. McCarthy: Research and development expenses were $30.8 million for the quarter, compared to $25.6 million in the corresponding period of 2018. The increase was attributable to license fees and maintenance fees related to an amendment to the UCSB licensing agreement which included the issuance of 150,000 shares of company common stock valued at $1.6 million, an upfront payment of $1 million, and an additional annual maintenance fee of approximately $800,000. The increase was also attributable to UCSB sublicense fees pertaining to the $10 million milestone payment earned upon AVVI selecting the second target in the second quarter of 2019, and increases in personnel-related and clinical-related expenses, partially offset by a decrease of $2.3 million in laboratory contracts and services as a result of the timing of manufacturing activities.

The decrease was primarily due to the $21 million milestone payments net of the associated sub license fee of 4 million earned in May 2018 under the CD 71 agreement with Abbvie of which 9.9 million was recognized in the second quarter of 2018.

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

Thank you Robyn so just to briefly wrap up from today's review of the second quarter. If you can see that we continue to make excellent progress in advancing our portfolio of innovative property drug candidates.

We look forward to a productive second half of 2019 as we advance our programs to the next stage of development to further diversify the potential of our product candidates and also realize the power of our innovative technology platform.

Thanks for your time and I'll now hand, the call back to Chris for Q and a.

Valerie Please open the call for questions.

Thank you.

Ladies and gentlemen, if you have a question at this time. Please press the Star then the one key on your Touchtone telephone.

Sean A. McCarthy: General and administrative expenses increased by $400,000 for the quarter compared to the corresponding period in 2018, and this was largely attributed to personnel-related expenses. Revenues during the second quarter of 2019 were $9 million, compared to $21.3 million in the corresponding period in 2018. The decrease was primarily due to the $21 million milestone payment net of the associated sub-license fee of $4 million earned in May 2018 under the CD71 agreement with AbbVie, of which $9.9 million was recognized in the second quarter of 2018.

A question settlement answered or you wish to remove yourself Mchugh. Please press the pound key.

We ask that you please limit yourself to one question and a follow up.

One moment for questions.

Our first question comes from Varone Kumar.

Of Cantor Fitzgerald Your line is open.

Hey, good afternoon, and thanks for taking the questions.

So Sean maybe first on CX still there there are nine.

Should we expect.

Update on activity from I think you are planning to have 14 patient in the door to Faiman cohort. So should we expect activity and safety.

In the second half are before you.

And plan to move into phase two and a second a quick one on Bristow.

Christopher Keenan: Thank you, Robin. So just to briefly wrap up today's review of the second quarter, I hope you can see that we continue to make excellent progress in advancing our portfolio of innovative pro-body drug candidates. We look forward to a productive second half of 2019 as we advance our programs to the next stage of development to further define the potential of our product candidates and also realize the power of our innovative technology platform. Thanks for your time, and I'll now hand the call back to Chris for Q&A.

No.

If you know as you mentioned, we have move to phase two randomized study was there any prequalified criteria in terms of activity or safety.

Which was kind of gating factor for them before they move to phase two any color there would be really helpful. Thank you.

Great, Yes, hi, Brian Thanks for the questions.

With regards to twos or is there and I think that.

I think what to expect there is our decision of.

Who's an indication to move into phase two will obviously be driven by the totality of the data that we will have collected by the end of the year. So.

Where and when we would actually present additional data remains to be determined.

Christopher Keenan: Thank you for the questions.

With regard to.

Operator: Thank you. Ladies and gentlemen, if you have a question at this time, please press the star then the 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. We ask that you please limit yourself to one question and a follow-up. One moment for questions. Our first question comes from Varun Kumar of Cantha Fitzgerald. Your line is open.

To BMS.

The decision to move into this randomized study that they're preparing.

Is entirely theirs, so I can't speak to that criteria.

Other than the fact that they are.

As we can see from clinical trials stock of preparing to do a fairly large study, which were obviously very pleased to see.

Thank you very much.

Thank you.

Our next question comes from towns Flynn of Goldman Sachs. Your line is open.

Hi, Thanks for taking the question. This is on for Terence and I was wondering if you could give us any perspective on bristol's.

Varun Kumar: Hey, good afternoon, and thanks for taking the questions. So Sean, maybe first on CX2009, should we expect an update on activity from, I think you're planning to have 14 patients in the dose refinement cohort, so should we expect activity and safety in the second half before, you know, you plan to move into phase two? And a second, a quick one on Bristol, now, you know, as you mentioned, they have moved to phase two randomized study, were there any pre-required criteria in terms of activity or safety, which was kind of a deciding factor for them before they moved to phase two? Any color there would be really helpful, thank you.

Checkmate two two.

Sorry, Ttseven data and kind of what.

Implications you think that might have on your portfolio. Thanks.

Yes, thanks for the question Missy.

Well as I mentioned in my earlier remarks.

Yes, we think that the.

Obviously that was a tale of two two datasets wasn't in terms of the combination readout and the monotherapy readout.

For Us. This is the combination read out is the most relevant we think in that.

In the topline that they've announced so far clearly indicates that the.

The nivo combination can be effective in that patient population.

Sean A. McCarthy: Great. Yeah. Hi Varun.

And Thats with.

Sean A. McCarthy: Thanks for the questions. With regard to 2009, I think what to expect there. Our decision on dose and indication to move into phase two will obviously be driven by the totality of the data that we will have collected by the end of the year. So where and when we would actually present that additional data remains to be determined. With regard to BMS, the decision to move into this randomized study that they're preparing is entirely theirs, so I can't speak to their criteria other than the fact that they are, as we can see from clinicaltrials.gov, preparing to do a fairly large study, which we're obviously very pleased to see.

As I mentioned earlier on the us with a much reduced dose of.

All of it so we think thats actually very encouraging it shows that it reinforces the importance of.

PD or PK PD, one PDL, one plus CCLP before as a.

As a powerful I O I O combination.

And with our ability, we believe with the pro body with CFO seven to to treat patients with full dose CP.

We believe we're in a position potentially in several indications to demonstrate.

Our value proposition with this.

With our combination. So we think that data is positive for us but of course positive BMS.

Varun Kumar: Thank you very much.

Thank you. Our next question comes from Peter Lawson of Suntrust Robinson. Your line is open.

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

Missy: Hi, thanks for taking the question. This is Missy on behalf of Terrence, and I was wondering if you could give us any perspective on Bristol's Checkmate 227 data and kind of what implications you think that might have on your portfolio. Thanks.

Hi, Thanks for taking the questions just on I guess, the Abbvie selecting the second candidate did they see something in the 2029 day to any color on that would be great.

Sean A. McCarthy: Yeah, thanks for the question, Missy. Well, as I mentioned in my earlier remarks, yeah, we think that, obviously, that was a tale of two data sets, wasn't it, in terms of the combination readout and the monotherapy readout. For us, the combination readout is the most relevant, we think, in that, you know, the top line that they've announced so far clearly indicates that the IPI-nevo combination can be effective in that patient population. And that's with, as I mentioned earlier, a much reduced dose of IPI. So we think that's actually very encouraging. It shows that it reinforces the importance of PD or PD-1 or PD-L1 plus TTLA-4 as a powerful IO-IO combination. And with our ability, we believe, with the ProBody and CX072, to treat patients with full-dose CIPI, we believe we're in a position, potentially in several indications, to demonstrate a value proposition with our combination. So we think that data is positive for us and, of course, positive for BMS.

[noise], obviously can't comment on any data coming from that study at this point.

The as I said the collaboration has to.

Components to it the.

Clinical program around 2029, and the discovery Alliance on the Ptcs.

And I cant make any comment on what drove them to make that second selection other than the fact that we were very pleased to see it.

Good and then any color around that time I get all that kind of tuck. It is it going to be one of these widely expressed targets again.

Would love to tell you more positive, but I really can't sorry.

Got you, Okay and then.

I guess, that's it thanks, Phil Thanks for taking the questions Vicki.

You're welcome.

Thank you. Our next question comes from Robert Burns of H.C. Wainwright. Your line is open.

Hey, guys. Thanks for taking my questions on the progress you guys are making so following up on a b M. S 96 to nine so I do you have any ideas the dose that they selected given your comment earlier, obviously dose selection highly important whenever you're looking on it be nivo conversation and then my second question is can you provide any additional color as to the current sort of planned indications for Cxos 72, both as monotherapy and in combination with yervoy or when we might have some granularity on that thanks.

Peter Richard Lawson: Thank you. Our next question comes from Peter Lawson of SunTrust Robinson. Your line is open.

Sean A. McCarthy: Hi. Thanks for taking the questions. Just on, I guess, AbbVie selecting their second candidate, did they see something in the 2029 data? Any color on that would be great.

Peter Richard Lawson: I obviously can't comment on any data coming from that study at this point. As I said, the collaboration has two components to it, a clinical program around 2029, and the Discovery Alliance from the PDCs, and I can't make any comment on what drove them to make that second selection other than the fact that we were very pleased to see it.

[noise], Yeah, Hi, Robert Thanks for the questions.

Comment on.

On dose of 96 to four nine at this point, we're going to have to wait and see.

How much.

Traditional granularity BMS is is willing to give once they.

Kick that study off.

With regards to over 70, we are in a position second half of the year to communicate more clearly on specific next steps for every seven to in terms of monotherapy in combinations are a lot more to say at this exact point, but plans are well under planning is well underway.

Sean A. McCarthy: And then, any color around the target, or the kind of target, is it going to be one of these widely expressed targets again?

Peter Richard Lawson: I would love to tell you more, Peter, but I really can't. Sorry.

Thank you.

Sean A. McCarthy: Gotcha, okay, and then, um, I guess that's it.

Our next question comes from Mohit Bansal of Citigroup. Your line is open.

Robert Burns: I guess that's it. Thanks for taking the questions. Thank you.

Great. Thanks for taking my question and congrats on the progress is that just wondering.

Sean A. McCarthy: You're welcome.

Robert Burns: Thank you. Our next question comes from Robert Burns of HC Wainwright. Your line is open.

Just wondering now that Uh huh.

Mohit Bansal: Hey guys, thanks for taking my questions and for the progress you guys have made. So, following up on BMS 9862.9, do you have any ideas about the dose that they selected, given your comment earlier that, obviously, dose selection is highly important whenever you're looking at the NEVO conversation? And then my second question is, can you provide any additional color to the current sort of planned indications for CX072, both as monotherapy and in combination with Urovoy, or when we might, you know, have some granularity on that? Thanks.

You have seen to date or a bit more granularity for <unk>.

To nine.

Could you help us understand they did your thought process in terms of you saw seven responses.

Before activity, but those are unconfirmed responses. So what exactly is going on there or do you just spoke to that.

The targeted issue or do you think the combination you can make a deeper how how are you thinking about.

Well I didn't quite get the second part of the question could you could you clarify the question.

Sure. So I mean, what I'm trying to understand is that are those seven the sponsors. They are are they they speak for the activity of the.

Sean A. McCarthy: Yeah, hi, Robert. Thanks for the questions. I can't comment on the dose of 986249 at this point. We're going to have to wait and see how much additional granularity BMS is willing to give once they kick that study off. With regard to 072, we are in a position, in the second half of the year, to communicate more clearly on specific next steps for 072 in terms of monotherapy and combinations. Not a lot more to say at this exact point, but planning is well underway.

Of the of the BDC.

But those are unconfirmed response, they surveyed oh, so in the interim self exploding that's part of it where do you stand in terms of what is your thought process. That's why these are the sponsors are.

Not longer lasting is just because of the targeted use of yeah, well cancer. It is kind of coming back because of that target or Oh, you think it is the <unk> where are you what are your thinking there how are you thinking about yeah. Yeah, great. Thanks. Thanks, Mike That's a great question and you know I I would refer back to.

Sean A. McCarthy: Thank you.

Mohit Bansal: Our next question comes from Mohit Bansal of Citigroup. Your line is open.

Sean A. McCarthy: Thanks for taking my question and congrats on all the progress as well. Just wondering that now that you have seen the data with more granularity for CX209, could you help us understand where your thought process is in terms of we saw seven responses which speak for activity, but those are unconfirmed responses. So what exactly is going on that these responses are not delivered? Is it the target issue, or do you think the combination you can make it deeper? How are you thinking about that?

Yeah some of our prior discussions.

Around the dataset that we presented at a CR, which I admittedly a you see a very sunrise at a very high level.

On this call.

So just to recap.

Mohit Bansal: Mohit, I didn't quite understand the second part of the question; could you clarify?

We.

As you rightly point out and as I mentioned earlier, we are in the data set presented at HCR, We had seven unconfirmed partial responses in a number of different tumor types. So encouraging evidence that this drug candidate can be active at the target can deliver payload into tumor cells.

Mohit Bansal: Sure. So, I mean, what I'm trying to understand is that those seven responses speak for the activity of the PDC, but those are unconfirmed responses. So, in terms of exploring that further, where do you stand in terms of what is your thought process as to why these responses are not longer lasting? Is this because of the target, which is where cancer is kind of coming back because of that target, or do you think it is?

The lack of confirmation of those responses derives from probably several things. It's always of course hard to say, but the contributors include.

First of all the facts that you know in this study as we reported in our poster presentation. These patients were very heavily pre treated so in many cases it was just ongoing disease progression.

Sean A. McCarthy: What are you thinking there? How are you thinking about it? Yeah, yeah, great. No, thanks. Thanks, Mohit. That's a great question. And...

Secondly.

The.

The fact, there's several patients came off drug early for.

Sean A. McCarthy: I would refer back to some of our prior discussions around the data set that we presented at AACR, which I admittedly summarized at a very high level on this call. So just to recap, as you rightly point out, and as I mentioned earlier, in the data set presented at AACR, we had seven unconfirmed partial responses in a number of different tumor types. So, encouraging evidence that this drug candidate can be active, that the target can deliver payload into tumor cells. The lack of confirmation of those responses probably derives from several things.

Ocular toxicities.

Driven by the Paylocity and for which we expected to see which in the early part of this phase one dose escalation, we were not taking measures to pre treat to try to.

Prevent so.

That phase one data set gave us what we needed to then.

Do what we're doing right now which is to dose patients towards the higher end of the dose escalation range beginning eight makes the keurig and ensuring that patients are given consistent and aggressive ocular profile access with the goal of keeping patients on drug longer.

To see.

Sean A. McCarthy: It's always, of course, hard to say, but the contributors include, first of all, the fact that in this study, as we've reported in our poster presentation, these patients were very heavily pretreated. So in many cases, it was just ongoing disease progression. Secondly, the fact that several patients came off drug early for ocular toxicities driven by the payload, DM4, which we expected to see, and which in the early part of this phase one dose escalation, we were not taking measures to pretreat, to try to prevent. So that phase one data set gave us what we needed to then do what we're doing right now, which is to dose patients towards the higher end of the dose escalation range, beginning at eight migs per kig, and ensuring that patients are given consistent and aggressive ocular prophylaxis with the goal of keeping patients on drug longer to see.., to what extent we can increase duration of treatment, which, of course, over time, we would hope would relate to an increase in duration of response and ultimate confirmation of responses.

To what extent, we can increase duration of treatment, which of course over time, we would hope would relate to an increase in duration of response and ultimate confirmation of responses. So that work is ongoing.

That work will be the the read out from that work will be obviously very important in our ultimate selection of dose.

For this agent and we believe we are on track to have that decision made by the end of the year.

So so far it's a very minus a phase one study.

As a brand new agent so its an experimental study we've learned a lot.

We're doing additional work to address those questions in real time.

Got it and then if I may ask one more on the CD 71 program.

I I mean I apologies. If you have mentioned that you think you are controlling this trial.

And what if anything we could see some initial data from this program.

So we're not providing any guidance on timing to data.

Sean A. McCarthy: So that work is ongoing. The readout from that work will be, obviously, very important in our ultimate selection of doses for this agent, and we believe we're on track to have that decision made by the end of the year. So it's important to bear in mind that this is a phase one study, this is a brand new agent, this is an experimental study, we've learned a lot, and we're doing additional work to address those questions in real time.

Yes.

An ongoing dose escalation study and.

We are you know that we're in the middle of so that's really all we can say right now.

Got it very helpful. Thank you very much.

Youre welcome.

Our next question comes from Biren Amin of Jefferies. Your line is open.

Yes, hi, guys. Thanks for taking my questions Sean.

On your plans for all seven to how many of the tumor types will be considered as a registrational study when you disclose your plans later this year.

Mohit Bansal: Got it. And then, if I may ask one more question on the CD71 program, I mean, apologies if you have mentioned it, but since you are controlling this trial, in what time frame could we see some initial data from this program?

Hi, Barry Great question.

Thanks for that.

Well just to take a step back and just recap the strategy for the monotherapy expansions. These many expansion cohorts at the time, we initiated them.

Sean A. McCarthy: So we're not providing any guidance on timing for data. It's an ongoing dose escalation study, and we are, you know, in the middle of it, so that's really all we can say right now.

You know in a rapidly moving field we.

Mohit Bansal: Got it. Very helpful. You're welcome.

We.

We cast a wide net in the hope of identifying one or more indications in which we would see.

Byron Amin: Our next question comes from Byron Amin of Jefferies. Your line is open.

Sean A. McCarthy: Yeah, hi guys. Thanks for taking my questions. Sean, on your plans for 072, how many of the tumor types would be considered a registrational study when you disclose your...

A relevant response rate and also.

An ongoing registrational path to registration based on a single arm study and.

Sean A. McCarthy: study when you disclose your plans later this year.

Sean A. McCarthy: Hi Barron, great question. Thanks for that. Well, just to take a step back and just recap the strategy for the monotherapy expansions, these mini-expansion cohorts, at the time we initiated them, you know, in a rapidly moving field, we cast a wide net in the hope of identifying one or more indications in which we would see a relevant response rate and also an ongoing registrational path to registration based on a single-arm study, and it continues to be the case that certain of these indications still have that path open, fewer than when we started this study, you know, a while back, but we do think that that window remains open, the convergence of, again, registrational path plus the data that we've already demonstrated. We're giving a lot of thought to that right now as to which of these indications could potentially offer a registrational path, and we're not ready to guide any more clearly today on that, but we will be guiding further in the second half of the year.

Continues to be the case that.

Certain of these indications still have that path open.

Fewer than when we started this study.

A while back but we do think that that window remains open.

The convergence of again Registrational path plus the data that we that we have already demonstrated.

We're giving a lot of thought of that right now as to which of these indications.

Could potentially offer a registrational path.

We're not ready to guide any more clearly today on that but we will be guiding further.

In the second half of the year.

Okay, and then maybe a car.

Question on the two to seven from earlier.

Why not be more aggressive in developing your seven too.

Plus it be given what we've seen attitude to seven in first line non small cell lung cancer setting.

Byron Amin: Okay, and then maybe a question on the 227 from earlier. Why not be more aggressive in developing O72 plus IPI given what we've seen out of 227 in the first line osmosis lung cancer setting?

Well as I said earlier on.

We do see those data and I think this is what youre alluding to we see those data as as positive for us in showing that that combination is an important combination is going to continue to be an important combination.

In a number of indications moving forward and we think that opens up a number of opportunities for us and you'll be hearing more about that from us and in the relatively near term.

Sean A. McCarthy: Well, as I said earlier, we do see those data, and I think this is what you're alluding to; we see those data as positive for us in showing that that combination is an important combination. It's going to continue to be an important combination in a number of indications moving forward. And we think that opens up a number of opportunities for us, and you'll be hearing more about that from us in the relatively near future.

Okay, and then maybe a question on the Osama tube MRF enough combo, what can we expect preliminary data from that study.

So our goal is to provide an update by the end of the year.

Got it and then and then just one last question I guess.

On this randomized trial with the probiotics retailer for that Brussels moving forward with.

Byron Amin: Okay, and then maybe a question on the O72-Vemurafinib combo. When can we expect preliminary data from that study?

Do you know which tumor types.

Sean A. McCarthy: So our goal is to provide an update by the end of the year.

Okay are going after.

I do not they.

If you look at their filing its it refers to patients with solid tumors.

Byron Amin: Got it. And then just one last question, I guess. On this randomized trial with the ProBody CTLA-4 that Bristol's moving forward with,

I think we can we'll make a best guess as to what that would be but.

That their public disclosures do not indicate which tumor type to this point.

Sean A. McCarthy: I do not. They, um, if you look at their filing system, it's, it's...

Got it thank you.

Thank you.

Sean A. McCarthy: do not.

Sean A. McCarthy: I think we can all make a best guess as to what that would be, but their public disclosures do not indicate which tumor type at this point.

I gave you have a question. Please press Star then the one key on your Touchtone telephone.

Our next question comes from Marcos.

Byron Amin: Got it. Thank you.

Mara Goldstein: Thank you. Again, if you have a question, please press star and then the one key on your touchtone telephone. Our next question comes from Mara Goldstein of Mihizu Securities. Your line is open.

Securities Your line is open.

Hi, guys. This is Gabriel Fung on behalf mangosteen and thanks for taking the question.

The first question I have here, Sam we reading in the 10-Q that there has been some changes and fund allocations for the IGI Fr project given that the company decided to undertake some additional testing for molecules that would you want to provide some additional details on that and secondly.

Gabriel Fung: Hi guys, this is Gabriel Fung on behalf of Mayor Goldstein and thanks for taking the questions. The first question we have here is: we're reading in the 10-Q that there have been some changes in fund allocations for the EGFR project given that the company decided to undertake some additional testing for molecules. Would you be able to provide some additional details on that? And secondly, given that checkpoint combinations are becoming more and more popular nowadays, does the company plan to assess any additional combination studies? Thank you.

Given that the checkpoint combinations are becoming more and more popular nowadays does the company plan to assess any additional combination studies. Thank you.

Oh, Yes, hi, Gabriel.

Hi, Thanks for the questions with regards to EG fr. It's an ongoing research projects and we are evaluating evaluating a range of different scaffolds, there by specific scaffolds and molecules and.

Sean A. McCarthy: Yeah, hi Gabriel. Thanks for the questions. With regard to EGFR, you know, it's an ongoing research project, and we are evaluating a range of different scaffolds, you know, bi-specific scaffolds, and molecules. And, you know, in the course of a lead optimization process, certain frameworks move forward; certain frameworks do not. And with the new revenue recognition rules, given the nature of the upfront payment in that deal, it requires us to, you know, report on that with a reasonable level of granularity. So really, all you're seeing there is the ongoing course of research with a platform like this, by specifics, where the specifics of the scaffold become very important to the ultimate activity of the molecule. In terms of combinations, yes, absolutely.

You know in the course of.

Lead optimization process certain.

Frameworks move forward certain frameworks do not and with the new revenue recognition rules.

Given the nature of the upfront payment in that deal.

It requires us to.

Yet to report on that with us.

A reasonable level of granularity so really all youre seeing there is.

The ongoing course of research.

With a.

A.

A platform like.

By specifics, where the specifics of the scaffold become very important to the ultimate activity of the molecule.

In terms of.

Combinations.

Yes, absolutely I mean, we as I mentioned in my earlier comments we.

Sean A. McCarthy: I mean, as I mentioned in my earlier comments, we believe the data we have presented thus far for CX072 is entirely consistent with the vision we have for this molecule to become a safer, more effective foundation for combination therapies across a range of mechanisms. And IPPE is one of those, which we remain very enthusiastic about, as I've said, and I'm pretty sure there will be others. And so we will be embarking on additional combinations, but we're not ready to disclose what any of those are at this point.

We believe the data we achieved.

Presented thus far for Cxos 70.

Is entirely consistent with the vision, we have for this molecule to become a safer more effective foundation of combination therapies.

Across a range of mechanisms and.

If he is.

One of those which we remain very enthusiastic about as I've said.

And I'm pretty sure there will be others, and so we will be embarking on additional combinations, but we're not ready to disclose what any of those are at this point.

Gabriel Fung: Awesome; thank you for the clarity.

Awesome, Thanks for the clarity.

Thank you.

Peter Richard Lawson: Thank you. Our next question comes from Peter Lawson of SunTrust Robinson. Your line is open.

Our next question comes from Peter Lawson of Suntrust Robinson. Your line is open.

Peter Richard Lawson: Hey, thanks for taking the follow-up. Just on 2009... Will we see the Part A and A2 data in the second half?

Hey, Thanks for taking the follow up just on.

200, knowing.

We see the was it the part a and a two data in the second half.

Sean A. McCarthy: 2-0-0-9, Peter, the update on AATR was A and A2, so that data has been disclosed for the most part. We're obviously continuing to follow those patients up. And at this moment in time, we continue with what we call the MDM TPI phase, which is additional dose refinement at the upper end of the dose range. Does that help?

Two 009 Peter.

The updated HCR was 82.

So that data for the most part has been.

Has been disclosed where obviously continuing to follow those patients up.

Hi, Andrew.

At this moment in time, we continue with the.

What we call the DMT pie face, which is additional dose refinement.

The upper end of the dose range does that help.

Peter Richard Lawson: Yeah, I got the sense that we were going to get kind of further follow-up and maybe additional patients for that A and A2, but it sounds like we won't.

Yes, I got the sense that we were going to get kind of further follow up and maybe additional patients for but a two bit.

Sean A. McCarthy: I wouldn't I wouldn't expect it. I think at this point, we're very focused on, I mean, obviously, we're still following those patients up from A and A2. We're doing additional dose refinement, and our goal is to get to that phase two dose and kick the phase two study off as soon as we can. The goal of having an indication picked by the end of the year, but the actual presentation of additional data from the study would likely be at a future conference to be determined.

Terms like we weren't.

I wouldn't I wouldn't expect there I think at this point, we're very focused on.

Well I mean, obviously, we're still following those patients up from 82 were doing additional dose refinement and at our our goal is to get to that phase two dose and kick the phase two study of.

You know as soon as we can go.

As having that dose.

An indication picked by the end of the year.

The actual presentation of additional data from the study would likely be at a future.

The future conference yet to be determined.

Peter Richard Lawson: And then, do you get any sense if we're going to see BMS's 249 data in the second half? And I guess kind of a follow-up question on that would be what data were we going to see from you in the second half?

Okay, and then do you get any sense, if we're going to see BMS is two following data in the second half.

And that and I guess kind of a follow up around that would be.

What data were going to see from you in the second half.

Sean A. McCarthy: So, with regard to BMS, all I can say is what they've said previously, which is that they are, they're guiding to potentially sharing some data on 249 this year. That's really all we know at this point. So, you know, the year is moving along, isn't it?

So with regard to BMS.

All I can say is what they've said previously which is that they are theyve guided to potentially sharing some data on two for nine.

This year.

Thats really all we know at this point so.

The year is moving along isn't it.

Peter Richard Lawson: With regard to CytomX additional data, I wouldn't expect a whole lot of additional clinical data from us between now and the end of the year. Just to recap, since ASCO in 2018, we've presented a substantial amount of clinical data at various congresses up to and including ASCO this year. We're really very focused right now, heads down, determining specific next steps to get these programs into the phase two setting. So I wouldn't expect a whole lot of additional clinical data this year. I think as we provide additional updates as this year progresses on our next steps for our programs, I think it will become clearer what types of data may be available in 2020. But we'll be guiding on that as 2019 continues.

With regard to Cytori makes additional data.

I wouldn't expect a whole lot of additional clinical data from us between now and the ended the year.

Just just to recap since ASCO of.

2018, we presented a substantial amount of clinical data at various congresses.

Up to an including ASCO of this year.

We are really very focused right now heads down.

Determining specific next steps to get these programs into the phase two setting.

So.

I wouldn't expect a whole lot of additional clinical data this year I think as we provide.

Additional updates as this year progresses on our next steps for our programs I think it will become clear what types of data maybe available in 2020.

But we'll be guiding on that as 2019 continues.

Sean A. McCarthy: Gotcha. Okay. Really helpful. Thank you so much.

Got you, Okay really helpful. Thanks much.

Peter Richard Lawson: You're welcome.

You're welcome.

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

Thank you.

I'm showing no further questions at this time I'd like to turn the call back over to Sean for any closing remarks.

Sean A. McCarthy: Thank you very much, and thank you all for joining us today. Again, we've had a very strong quarter continuing to advance both pipeline and platform and our alliances, and we look forward to a very productive second half of 2019. So, thank you all very much for your time.

Thank you very much and thanks, all for joining US today again, we we've had a very strong quarter continuing to advance both pipeline and platform and our alliances and we look forward to a very productive second half of 2019. So thank you all very much for your time.

Operator: BF-WATCH TV 2021